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Child care proposal gives least to poorest [CA]

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Author: 
Galloway, Gloria
Format: 
Article
Publication Date: 
26 Apr 2006
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Low- and middle-income families will realize the smallest net benefit from the Harper government's $1,200-a-year child-care payment in part because the Conservatives are scrapping a separate assistance program.

The Conservative plan for meeting the country's child-care needs is to give families a direct payment of $100 a month, $1,200 annually, for every child under 6. The specifics of how that plan will be unveiled are expected to be in next Tuesday's budget.

But the young-child supplement of the Canada Child Tax Benefit, which currently pays $20.25 a month to parents who do not claim child-care expenses for their preschool-age children, will be eliminated at the same time. The benefit is due to increase in July to $249 annually.

The Tories outlined their intention during the election campaign to scrap the young-child supplement, and the government confirmed that it will do so to the Caledon Institute, a think tank that deals with child-care issues.

In a report to be released today, the institute takes the government to task for rolling the young-child supplement into the child-care allowance.

The report, called "The incredible shrinking $1,200 child-care allowance and how to fix it," says the supplement most often goes to families of low or modest income because higher-income parents are more likely to claim child-care expenses and are therefore disqualified from receiving the payment.

But the best solution, the report says, is to tack the child-care allowance onto the Child Tax Benefit, which is not subject to income tax and is gradually reduced as income rises. Unlike the Conservative child-care plan, this would not favour one-income families over two income-families.

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- reprinted from the Globe and Mail

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