Question Period Note: CHILD POVERTY NB

Article on Child Poverty in New Brunswick

• The Government is committed to supporting families and ensuring that every child gets the best start in life.

• The Canada Child Benefit (CCB) provides support for low- to middle-income families with children. Because it is tax-free and based on income, it provides more support to those who need help the most. Since its introduction, the CCB has helped reduce the number of children living in poverty by hundreds of thousands.

• The Government is also delivering $10-a-day child care and creating new child care spaces. We are supporting thousands of families who can’t bring their kids to the dentist with the Canadian Dental Care Plan. With our new National School Food Program, we are setting up children for success by making sure they can learn on a full stomach.

• But we know that some children continue to live in poverty and that is why the Government will continue to look for ways to support families and their children.

Release of the “Child & Family Poverty Report Card” by the New Brunswick Human Development Council

• On November 24, 2024 the New Brunswick Human Development Council (the Council) released a report which highlighted a worsening of child poverty in the province. An article in the New Brunswick Telegraph Journal, published on the same date, summarized the key findings from this report

• The Human Development Council is a non-governmental organization based in New Brunswick which, according to its mission statement, “(i)dentifies and addresses social issues in New Brunswick through research, information, coordination and networking”.

• This “Child & Family Poverty Report Card” relies on the Census Family After-Tax Low-Income Measure (CFLIM-AT) applied to 2022 data from the T1 Family File (e.g. federal income tax data) and the 2021 Census to produce its analysis. The CFLIM-AT is fundamentally different from Canada’s Official Poverty Line which is based on the Market Basket Measure (MBM).

o The CFLIM-AT is a relative measure of low income that sets low-income thresholds at 50% of the median family income across Canada. According to this measure, a family is in low-income if their after-tax income is below that threshold.
o The MBM an absolute measure of low income that establishes poverty thresholds based on the cost of a specific basket of goods and services. The MBM is sensitive to regional differences in living costs, which is not the case for CFLIM-AT, and is derived annually using data from the Canadian Income Survey (CIS).

• The Council prefers the CFLIM-AT because it allows for the production of data on smaller geographic areas within New Brunswick.
o The Council also highlights that Campaign 2000, a major anti-poverty organisation, used the LIM as primary poverty measure in annual child poverty reporting for Canada.

• Key data points highlighted in this report using their measurement approach (CFLIM-AT) include:
o That roughly 1 in 5 Canadian children lived in poverty.
o The child poverty rate in Canada increased from 15.6% in 2021 to 18.1% in 2022.
o New Brunswick had the country’s sixth-highest child poverty rate (fourth if only considering the provinces and not the territories).
o The number of children living in poverty in New Brunswick rose from 26,360 (18.7%) in 2021 to 31,430 (21.9%) in 2022.
o Nearly 1 in 4 children under age 6 (24.44%) are living in poverty in New Brunswick.
o 47.9% of children in one-parent families lived in poverty, compared to 11.2% of children in couple families.
o Government transfers reduced New Brunswick's child poverty rate from 38.8% to 21.9%.
o The Canada Child Benefit lifted 14,580 children out of poverty in New Brunswick in 2022.

• Using Canada’s Official Poverty Line (applied to Canadian Income Survey data), the following official poverty rate data is available for Canada and New Brunswick:

o Canada’s overall child poverty rate was 9.9% in 2022, representing approximately 735,000 children, up from 6.4% in 2021, representing approximately an increase of 273,000 children.
o NB had an overall poverty rate of 10.9% in 2022, up from 6.7% in 2021 (a 63% increase) but down substantially from 16.2% in 2015 (the year before the CCB was introduced)
o The child poverty rate in NB was 11.3% in 2022, representing approximately 16,000 children. This rate is up from 7.2% in 2021, representing approximately an increase of 6,000 children in poverty.
o It is important to note that the phasing out of temporary pandemic-related income support measures initiatives, as well as sharp increases to the cost of living, were key factors in poverty rates increasing in 2022.
On CCB:

• The Canada Child Benefit (CCB), which is delivered by the Canada Revenue Agency, provides support to over 3.5 million families and over 6 million children, putting close to $26 billion, tax free, in the hands of Canadian families each year. Most families receiving the maximum CCB amounts are single-parent families, with approximately 90% of them being single mothers.

• To ensure that the CCB continues to help Canadian families over the long term, the CCB is indexed to keep up with rising costs. Thanks to indexation, in the 2024–25 benefit year, the maximum annual benefit is $7,787 per child under 6 years of age, and $6,570 per child aged 6 through 17. Families with less than $36,502 in adjusted family net income receive the maximum benefit. Both the maximum benefits and the income thresholds will be indexed in future years.

If pressed
• The CCB is having a significant positive impact on families with children. According to the 2022 Canadian Income Survey, the poverty rate for children, based on Canada’s official poverty measure, was 9.9 percent reflecting a significant decrease from the poverty rate of 16.3 percent in 2015.