National Council of Welfare

Conseil national du bien-être social

FOR IMMEDIATE RELEASE

CLAWBACK OF CANADA CHILD TAX BENEFIT DISCRIMINATES AGAINST SINGLE-PARENT MOTHERS, SAYS WELFARE COUNCIL

             The new system of federal child benefits discriminates against
families on welfare, especially single-parent mothers and their
children, the National Council of Welfare said in a report
published today.
             "Single-parent mothers and their children are the family type
most in need of help from governments," said the report, Child
Benefits: Kids Are Still Hungry. "Yet they are the family type
that gets little or no additional support from the Canada Child
Tax Benefit."

  
             Under federal, provincial and territorial arrangements that
went into effect on July 1, 1998, the increase in federal child
benefits is "clawed back" from families on welfare in most parts
of Canada. Newfoundland and New Brunswick have decided not to
claw back benefits - at least for the time being.

  
             Families which have earnings as their main source of income
get to keep the increase.

  
             "Single-parent families are particularly disadvantaged because
of the high percentage of these families on welfare. And because
90 percent of poor single-parent families are headed by mothers
rather than fathers, the Canada Child Tax Benefit winds up
discriminating against women." -2-

  
             The initial announcement of the Canada Child Tax Benefit was
made in the 1997 federal budget speech, but the government has
still not published any data on the impact of the benefit on
different types of families in different parts of Canada.

  
             The welfare council estimates that perhaps only 36 percent of
all poor families with children will get to keep the increase in
federal benefits. The other 64 percent will have the increase
clawed back.

  
             Perhaps only 17 percent of poor single parents will wind up
as net beneficiaries of the Canada Child Tax Benefit, and perhaps only
59 percent of the poor couples with children.

  
             The figures are summarized in Table 2 of the report.



  

TABLE 2

POSSIBLE IMPACT OF THE CANADA CHILD TAX BENEFIT

ON POOR FAMILIES WITH CHILDREN

 

All Poor Families

Net CCTB Beneficiaries

% of Poor Families

Single-Parent Families

412,000

70,000

17%

Two-Parent Families

372,000

219,000

59%

Other Families

14,000

1,000

9%

Total

798,000

290,000

36%

             "The extreme targeting that was built into the Canada Child
Tax Benefit is completely unacceptable to the National Council of
Welfare," the report said. -3-
             "Here is a program where substantial sums of new federal
money are being spent, but the additional money benefits barely
one-third of the poor families with children and bypasses the other
two-thirds. Many of the families being bypassed are single-parent
families in desperate circumstances."

    
             The money clawed back by provincial and territorial
governments is supposed to be "reinvested" in other programs for
children. The welfare council said there are no national standards
to speak of in the way the money is being spent, and there is no
consistency in programs from one jurisdiction to another.

    
             "Overall, the net effect is to convert an estimated $228
million of federal money into $228 million of provincial or
territorial money in the first nine months of the Canada Child
Tax Benefit," the report said. "The appeal to provinces and
territories is obvious: more money from Ottawa with almost no
strings attached. It is difficult to see any appeal at all
from the point of view of the federal government."

    
             Members of the House of Commons voted unanimously in 1989 to
eliminate child poverty by the year 2000. Unfortunately, Canada
went into another recession in 1990, and child poverty rates
started inching their way to record highs in the years that
followed.

    
             "It has always been clear to us that child poverty will not
disappear on its own," the welfare council said. "Now more than
ever, it is clear that eliminating child poverty requires a major
and continuing commitment by governments to put children first.
That means putting children and their families ahead of paying down
the national debt, ahead of tax breaks for well-to-do individuals
and corporations and ahead of other major new spending programs."

    
             Child Benefits: Kids Are Still Hungry calls for an end to
the clawback and reinvestment strategy no later than July 1, 1999,
the date chosen by governments for the next increase in the Canada
Child Tax Benefit. The welfare council said all families, both
welfare families and low-wage families, should get to keep all
the increases in federal government benefits. -4-

    
             The council also urged Ottawa to provide full indexation
of the Canada Child Tax Benefit as of July 1, 1999, in order to
maintain the purchasing power of the benefit for all families
which receive it.

    
             The federal government has committed a total of $1.7 billion
a year in additional spending on the Canada Child Tax Benefit by
the year 2000. The National Council of Welfare is pleased to see
a continuing and growing financial commitment from the federal
government to families with children and is pleased by the spirit
of co-operation that has characterized federal, provincial and
territorial meetings on children's issues in recent months.

    
             The report said the co-operation should continue, but current
arrangements for clawing back and reinvesting recycled federal
money must be abandoned.

    
             The National Council of Welfare is a citizens' advisory body
to the Minister of Human Resources Development. __________________________ For more information, please contact: National Council of Welfare 1010 Somerset Street West, 2nd Floor Ottawa K1A 0J9 (613) 957-2961

    
Main page/ About/ Online Pubs/ Pubs List/ Statements
 
Welfare Recipients/ Poverty lines/ Reach us/ Related Sites/ Français