Question Period Note: CANADA CHILD BENEFIT

Canada Child Benefit Update

• The Government introduced the Canada Child Benefit to provide increased 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.

• The Canada Child Benefit is simple, generous, and targeted so that about nine out of ten families are better off than under the former suite of child benefits.

• The Canada Child Benefit has been increasing the incomes of families with children since its inception in 2016. It has played a key role in reducing the number of children living in poverty, which has declined by 435,000 between 2015 and 2019.

• To ensure that the CCB continues to help Canadian families over the long term, the Government began indexing the CCB, starting in July 2018, to keep pace with the cost of living.

To provide further support for Canadian families facing hardship as a result of the COVID-19 outbreak, the Government provided a one-time enhancement to the Canada Child Benefit payment amounts of $300 per child for families already receiving the Benefit, as part of the May 2020 payment. In addition, up to $1,200 in 2021 is being provided in the form of the CCB young child supplement for each child under the age of six for families already receiving the CCB.

• In July 2016, the CCB replaced three different previous benefits—the Canada Child Tax Benefit including the National Child Benefit Supplement, and the Universal Child Care Benefit—with one simplified, fair and tax-free monthly child benefit.

• To ensure that the CCB continues to help Canadian families over the long term, the Government began indexing the CCB, starting in July 2018, to keep pace with the cost of living.

• A foster parent may not be considered primarily responsible for the care and upbringing of a child if the child is legally, physically, or financially maintained by a child welfare agency. In those cases, a children’s special allowance is paid to the agency and the CCB is not available to the foster parent.

• The Children's Special Allowances (CSA) program provides payments to federal and provincial agencies and institutions (such as children's aid societies) that care for children. The monthly amount payable for each child is equal to the maximum amount of the CCB. For eligible children, the CSA payment may also include the Child Disability Benefit. An agency can request that CSA payments be made directly to a foster parent of the child.

• In addition, there is a Child Disability Benefit (CDB) which is a monthly benefit included in the Canada Child Benefit to provide financial assistance to qualified families caring for children who have a severe and prolonged impairment in physical or mental functions. Pour l’année de prestations 2021-2022, la Prestation pour enfants handicapés fournit jusqu’à 2 915 dollars pour chaque enfant de moins de 18 ans admissible au crédit d’impôt pour personnes handicapées.

• The Department of Finance is the policy lead on the CCB, and the Canada Revenue Agency administers the benefit. ESDC contributes to ongoing policy development by working collaboratively with them and with provincial and territorial governments, to help ensure that the CCB continues to result in strengthened systems of support for all low- to middle-income families with children across Canada.

• The Canada Child Benefit (CCB) delivered by the Canada Revenue Agency is:
‒ Simple—families receive a single payment every month;
‒ Tax-free—families will not have to pay back part of the amount received when they file their tax returns;
‒ Targeted to those who need it most— low- and middle-income families receive more benefits, and those with the highest incomes receive lower benefits; and
‒ Generous— on average, families benefitting from the CCB received about $7,300 in CCB payments for the 2020-21 benefit year.

• The CCB helps almost 3.7 million families and about 6.5 million children, putting about $24 billion, tax free, in the hands of Canadian families each year. Close to 65 percent of families receiving the maximum CCB amounts are single-parent families, and more than 90 percent of these are led by single mothers.

• To ensure that the CCB continues to help Canadian families over the long term, since July 2018, the CCB has been indexed to keep pace with the cost of living.

• Indexing the CCB means Canadian families will have more money to help keep up with rising costs for things like healthy food, sports programs and music lessons. With this increase, in the 2020–2021 benefit year, the maximum annual benefit will be $6,833 per child under 6 years of age, and $5,765 per child aged 6 through 17. Families with less than $32,028 in adjusted family net income receive the maximum benefit. Both the maximum benefits and the income thresholds will be indexed in future years.

• To provide support for Canadian families facing hardship as a result of the COVID-19 Pandemic, the Government provided additional temporary support, including:
o A one-time enhancement to the CCB payment amounts of up to $300 per child for most families, in May 2020; and,
o Up to $1,200 in 2021 for each child under the age of six for families already receiving the CCB, in the form of the CCB young child supplement.

• The Children’s Special Allowance (CSA) is a tax-free monthly federal benefit paid in respect of children under the age of 18 who are in the care of federal, provincial/territorial or First Nations agencies and institutions. The CSA is equivalent to the maximum (unreduced) amount of the CCB, plus the Child Disability Benefit, where applicable. The one-time enhancement of $300 to the CCB also applied to the CSA – that is, the CSA was increased by $300 per child for the 2019-20 benefit year, delivered as an increase to a CSA payment for a child for the month of May.

• To ensure that all eligible families are able to access the CCB, and other federal benefits, Budget 2018 provided $17.3 million over three years, starting in 2018–19, to expand outreach efforts to Indigenous communities, and to conduct pilot outreach activities for urban Indigenous communities. In 2020, ongoing funding was provided to make these initiatives permanent and, in 2021, the Government worked to make simplified credit and benefit returns and CCB forms more widely available to Indigenous peoples.