Call to fight child poverty

Report urges $18 billion boost Also recommends raising taxes

The Toronto Star, LAURIE MONSEBRAATEN, STAFF REPORTER, May 5, 2004.

Ottawa should consider using future budget surpluses and modest tax increases to inject $18 billion annually into new services and income supports to fight child poverty, says a report to be released on Parliament Hill today.

With the country's child poverty rate stuck at about 16 per cent for the past 30 years, Ottawa needs to adopt a comprehensive, well-financed social investment strategy that includes labour market initiatives, income security, housing and early childhood education and care programs, argues the report by Campaign 2000.

"There are no easy, low-cost solutions to eliminate child poverty," says the national group which represents more than 90 social service, advocacy, labour and faith organizations dedicated to making elected officials live up to their promises to support children.

Specifically, the report calls on Ottawa to:

Work with provincial governments to raise the minimum wage to $10 an hour by the end of 2007, beginning with a raise to $8 by the end of 2005 and $9 by the end of 2006.

Restore eligibility for Employment Insurance by introducing a uniform 360-hour qualifying requirement, and extend the EI benefit period to one year to protect all earners, including low-income parents, when the economy is in recession.

End the clawback of child benefits from people on welfare and raise benefits to a maximum of $4,900 per child by 2007. This would increase Ottawa's annual $8 billion spending on the program by $10 billion annually.

Take a leadership role with the provinces to develop a national system of early childhood education and care for all families, and increase annual child-care funding to the provinces by $6 billion by 2008.

Invest at least $2 billion annually over the next five years to build 25,000 new affordable homes per year.

Almost 15 years after a 1989 all-party parliamentary resolution to end child poverty in Canada by 2000, the problem persists, says the report, called "Pathways to Progress: Structural Solutions to Address Child Poverty." Although Ottawa has taken some steps to address the problem, such as introducing the child tax benefit and signing federal-provincial agreements on affordable housing, early childhood development and child care, none of the measures is adequately funded or broad enough in scope, it adds.

"The problem is the reluctance on the part of Canada's governments to act on lessons learned," the report says.

It points to evidence suggesting public support for tax cuts is waning and that Canadians may be willing to pay for the broader measures it proposes. The report argues that Canada's taxation level is light compared with most OECD countries. "We think there is room for modest tax increases," said Laurel Rothman, national co-ordinator of Campaign 2000 and a co-author of the report.

A January Ekos Research poll shows broad public support for governments to spend budget surpluses on social programs rather than pay down debt. But it would be "quite a stretch" to say Canadians would be prepared to pay higher taxes to fight child poverty, said Ekos president Frank Graves.

"Child poverty is a very high priority for Canadians and has been for some time.But there's a very cluttered list of worthy causes out there and $18 billion a year is a big ticket."

The report says Ottawa should consider paying for the strategy through a 1 per cent increase in income tax rates to provide $5 billion annually; new tax rates for high earners to raise about $2 billion annually; and a 1 per cent increase in the GST to yield about $4 billion annually.

Budget surpluses — which have averaged about $7 billion annually over the past five years — should also be considered for investment in the plan, it says.