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All Canadians with very young children will receive monthly cheques from the new child-care program -- a plan that will be particularly popular for families with one spouse not earning an income.

As was predicted, wealthy single-earner families stand to gain more than those in which both parents work but make less money.

Beginning in July, the new Universal Child Care Benefit, which until the release of the budget yesterday had been called the Choice in Child Care benefit, will pay parents $100 a month for every child under 6.

The benefit is expected to cost the government $2.085-billion annually -- substantially more than the previous Liberal government had allotted to its child care. But supporters of the Liberal plan say the new allowance will do nothing to close the gap between the number of child-care spaces available across Canada and the number required by working parents.

Monica Lysack of the Child Care Advocacy Association of Canada said the cuts to regulated care are deeper than her group had expected because $25-million the Liberals promised for aboriginal child care and $25-million for accountability measures are not included.

"A family allowance is great, but to call it child care is an insult," Ms. Lysack said. "When the numbers are analyzed, it's like an allowance you would give your children."

The new benefit will automatically go to families receiving the Child Tax Benefit. Others will have to apply to the Canada Revenue Agency to be put on the list.

The structure of the new plan means that rich families with a stay-at-home parent will see a greater increase to their bottom line because the money will be taxable off the income of the lowest-paid spouse.

And richer families will ultimately feel the gain more than poorer ones because, by June, 2007, those who currently receive the young-child supplement of the National Child Tax Benefit will find that it has been rolled into the new allowance.

The young-child supplement is available only to families who do not claim child-care costs. Child-care costs are more often claimed by those at higher incomes.

The government has assuaged the fears of some critics by saying that the Universal Child Care Benefit will be delivered outside of the income-tax system. But only five provinces -- Manitoba, Saskatchewan, Ontario, New Brunswick and Prince Edward Island -- have so far said they would not claw back provincial benefits from the federal child-care payments.

Agreements the previous Liberal government signed with the provinces providing money for the creation of regulated child-care spaces will be phased out by March, 2007.

After that time, the Conservatives will enact their own plan, which involves setting aside $250-million annually to create spaces.

Catharine Laidlaw-Sly, past president of the national Council of Women, said the Conservative plan is "absolutely inadequate" and geared to parents who are well off.

But those who favour a program that also provides help for stay-at-home parents disagree.

"This is a significant positive step for families," Dave Quist of the Institute of Marriage and the Family Canada said of the child-care provisions. "They are bringing the $100 per month credit for child care in for families and, on top of that, they have put a quarter of a billion dollars aside for child-care spaces."

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The family that saves together

Estimated average over-all tax savings for individuals, by family income group

SOURCE: BUDGET 2006