Advocates press Ottawa to retract child benefit cutbacks

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This article was published 29/07/2022 (238 days ago), so information in it may no longer be current.

OTTAWA — The Trudeau government is facing calls from Winnipeg MPs to stop a second reduction of payments for children in working-class homes, which will amount to nearly $1.5 billion in withheld “baby bonus” cheques.

“It is no secret that people are struggling, and I find it callous of this government to go after families that need the support the most now,” said Winnipeg Centre MP Leah Gazan.

For more than a year, her NDP colleagues have been asking Ottawa to reverse cutbacks to the Canada Child Benefit based on households who reported a higher income due to COVID-19 support programs.

The baby bonus goes to all households with children except for the very richest, and families earning less than $33,000 receive extra top-ups.

However, programs like the Canada Emergency Response Benefit have pushed some households above that threshold, meaning families who got supports for employment loss due to the pandemic in one year are later receiving less money for their children’s expenses the next.

Leila Sarangi, national director of the anti-poverty group Campaign 2000, argues it undermines the purpose of both programs. One aimed to get families through the pandemic; the other is supposed to lift children out of poverty.

“It’s very antithetical to everything the government says they want to do: a feminist and inclusive recovery that leaves no one behind,” she said.

Manitoba leads the provinces for child poverty and has a high birth rate, making it a disproportionate user of the Canada Child Benefit.

A metric that includes the cost of child care and a vehicle for rural residents puts 28.4 per cent of Manitoba children as living in a family that cannot meet basic needs. Three of Canada’s four poorest ridings are in Manitoba, with the province’s North in the lead, Winnipeg Centre in third, and the Dauphin area placing fourth.

Sarangi said across Canada, people knew the CERB could be taxed but didn’t expect it to decrease their child benefits.

“What we’re hearing from folks is a real worry about being able to pay rent, to afford groceries and gas,” she said from Toronto.

“It’s causing undue stress and we’re hearing from families in all parts of the country being evicted and living in motels, temporary spaces or Airbnbs (rentals).”

John Stapleton, a former Ontario bureaucrat who helps low-income families navigate the tax system, tabulated Revenue Canada data and found the households seeing the most decreases in child benefits are single mothers who work and have multiple kids.

“They did pay tax on (COVID benefits) but it’s reducing their money from the Canada Workers Benefit, from the GST credits and their child benefits,” he said.

In June, after a request from Elmwood—Transcona MP Daniel Blaikie, the Parliamentary Budget Officer reported Ottawa is saving $1.45 billion over three fiscal years by reducing baby bonus payments to families who received pandemic benefits.

The policy lowers payments for 1.7 million individuals last year, 791,000 people this fiscal year and another 596,000 next year, according to the independent agency’s projections.

That means an average reduction of $606 this year, compared to $535 last year and $133 next year.

Employment Minister Carla Qualtrough said her government is “very mindful” of the issue.

“We tried to make it very clear (CERB) would be considered employment-type income, for the purposes of entitlements to other benefits the federal government may offer,” Qualtrough said during a Monday visit to Winnipeg.

“If people made over a certain amount of money because of CERB, they might have experienced a slight reduction in their Canada Child Benefit payment… I can assure you it is a very small number of families.”

Qualtrough’s office said it would provide figures on how many families are getting a reduction in their benefits due to having received COVID-19 benefits. Three days later, it said it lacked that information.

“We are working very, very closely with any impacted individual, to basically understand individual financial circumstances, and ensure that people are still able to pay their bills,” Qualtrough said.

Gazan argued the government should instead ramp up taxes on booming oil companies and grocery chains.

“Why are they not going after big corporations? Why are they going after single moms with multiple children to try and pay for the pandemic?” she said. “It really shows a lot of indifference from this government, particularly at a time where inflation rates are rising astronomically.”

Sarangi’s group wants Ottawa to stop all reductions in benefits and CERB clawbacks for low-income Canadians. The government has instead issued stipends to the poorest seniors, and for self-employed people in difficulty.

— with files from Gabrielle Piché

dylan.robertson@freepress.mb.ca