The 2016 Federal Budget brought the federal government back to the table when it comes to fighting poverty across the country.
From the creation of a new federal child benefit to coordinating a national housing strategy, there is potential that these investments can make a substantial impact in poverty reduction when combined with provincial and local initiatives.
1. Creation of the Canada Child Benefit
The new Canada Child Benefit announced in the federal budget is one of the biggest developments in social policy at the federal level in many years. This new progressive, non-taxable benefit has real potential to lift hundreds of thousands of children out of poverty. However the devil will be in the details when it comes to families receiving social assistance, who would be among the poorest families needing the maximum amount of the benefit the most.
The 2016 federal budget created the new Canada Child Benefit by consolidated the existing patchwork of federal child benefits, and targeting it so it could better benefit low income families. The Canada Child Benefit will provide a maximum annual benefit of up to$6,400 per child under the age of six, and up to $5,400 per child for those aged six through 17. According to the federal budget document, for families receiving less than $30,000 a year, this could mean a maximum increase of $1,548 per child under six, and a $1,484 increase for per child six and over.
In Toronto, 35 per cent of households accessing food banks are families with children. This extra income could make a big impact in reducing the need for food banks for these families. However, in order to ensure the families who need the support the most will benefit from the new Canada Child Benefit, it is important that the provinces and territories do not claw back that income from families receiving social assistance.
This is a particularly important consideration for those accessing food banks in Toronto, as nearly 60 per cent of families with children accessing food banks receive social assistance as their main form of income. While the previously implemented National Child Benefit Supplement allowed provinces and territories to claw back this income from families on social assistance, the federal government can take a strong lead in setting a standard of not allowing this income to be clawed back.
2. Creation of a National Early Learning and Child Care Framework
Lack of affordable childcare is a significant financial barrier for many families. Past Who’s Hungry surveys found that almost a quarter of parents said that they could not enter the workforce because of both cost and access to daycare.
The federal budget proposed to invest $500 million in 2017–18 to support the establishment of a National Framework on Early Learning and Child Care, to be developed in consultation with the provinces, territories and indigenous communities beginning this year.
3. Increased access to Employment Insurance
The most common reason people need a food bank for the first time is because they have lost their job.
Many cannot access E.I. because they do not have enough hours and have to apply directly to social assistance as a last resort. Increasing part time, contract and seasonal arrangements make acquiring enough hours to qualify more difficult.
The federal budget expands E.I. coverage to those that are new to or re-entering the labour force, by reducing the number of hours required for them have worked in order to be eligible for the program. This will expand access to the program for an estimated 50,000 additional claimants.
The budget also commits to reducing the waiting period to access E.I. from two weeks to one week. This will give people who have lost their jobs quicker access to a source of income.
4. Topping up the Guaranteed Income Supplement for Seniors
Food insecurity among seniors has been increasing. The Canadian Community Health Survey reported a 24 per cent increase in the number of severely food insecure seniors from 2007 to 2012. For many seniors on low income, their pensions have not been able to keep up with rapidly rising food and housing costs.
The federal budget has committed to increase the Guaranteed Income Supplement for single seniors with the lowest levels of income, increasing their payments by $947, as well as adjusting benefits on a quarterly basis to match increases in the cost of living.
The federal budget also commits to restoring the eligibility for Old Age Security and Guaranteed Income Supplement to age 65 from age 67. This is especially important for those living in poverty who will be able to receive this essential form of income when they turn 65.
5. Increasing affordable housing and leading a National Housing Strategy
One of the most common barriers food bank clients face is the high cost of housing. Clients spend 71 per cent of their income on rent and utilities, and one-third skip meals in order to be able to keep a roof over their heads. Toronto is becoming increasingly unaffordable for too many families, and the supply of subsidized housing units is way too small to be able to keep up with the demand.
The new federal budget makes a $2.3 billion commitment over two years to repair and retrofit existing subsidized housing units as well as creating new affordable housing. The budget also commits the federal government to leading the coordination of provinces, territories, and other groups to develop a National Housing Strategy. With the City of Toronto, the Province and Federal government now aligned in seeking to address the need of affordable housing, there is new opportunity to create long term, transformational change in this area.