This year's expansion of the Universal Child Care Benefit will deliver billions of dollars to parents with no child-care expenses at all, according to an analysis from the Parliamentary Budget Officer that has reignited debate over Ottawa's approach to child care.
Jean-Denis Fréchette, the PBO, released a report Tuesday that found the Conservative government's latest child-care measures will bring total federal spending on child care to nearly $8-billion a year. The report notes this is a major increase over the $600-million spent by Ottawa prior to 2006, when the Conservatives came to power promising the Universal Child Care Benefit.
The nearly $8-billion in credits and tax breaks will outpace the $5.7-billion in total household spending claimed for child care.
Even though the program is called a child-care benefit, the PBO found that only 49 per cent of the money will go to families with children under 13 and child-care expenses. The remaining 51 per cent will go to families with teenagers and families with no child-care expenses.
"It's not child care. It's a misnomer," said Martha Friendly, director of the Toronto-based Childcare Resource and Research Unit. Ms. Friendly said she was floored when the government announced last year that it would increase the eligibility to cover parents with children ages six to 17.
"Eight-billion dollars is a lot of money to be throwing around that way," she said.
Prime Minister Stephen Harper announced in October that Ottawa would expand the Universal Child Care Benefit that it first launched in 2006. The original family benefit of $100 a month for each child under six is increasing to $160 a month. Also, parents will receive a new benefit of $60 a month for each child between the ages of six and 17.
The Conservative government announced last week that the additional 2015 payments will go to parents on July 20, retroactive to Jan. 1. That means about four million families will receive hundreds of dollars from the government just three months before the Oct. 19 federal election.
In addition to the benefit changes, the government has also increased the value of the Child Care Expenses Deduction.
The PBO report notes that according to Statistics Canada, the average annual child-care expense is $3,795. The PBO acknowledges it is relying on a "strict" definition of child care that refers to the paid care of a child either inside the home or outside of the home. An average also includes smaller costs such as after-school care and camps, meaning the average cost of full-day daycare would be much higher.
The Conservative government has promoted the credits as a way to give parents a choice on how to spend the money, including the possibility that one parent could stay home or work fewer hours.
NDP Leader Thomas Mulcair – who is promising a national daycare program – said the PBO report shows the government's daycare program is "bogus." However, the Prime Minister said the report shows his government has significantly increased spending on child care.
Supporters of government-funded daycare programs argue distributing money directly to parents fails to ensure quality, licensed and affordable child-care spaces are available for parents.
Candice Bergen, the Conservative Minister of State for Social Development, said parents have many child-care costs that don't fit the definition for tax purposes, including having a parent stay at home or having a grandparent live in the home to help with child care.
"There's so many scenarios that we could get into whereby families are incurring costs to have somebody else look after their child, but it's not something that the PBO could necessarily dig into and find out, and I think he acknowledged that," she said.