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Following through on a campaign promise, [Prime Minister Stephen] Harper's party scrapped a multibillion dollar plan by the long-ruling Liberal Party to set up a national day-care system. Instead, the government will start mailing a monthly cash payment of 100 Canadian dollars, or about $90 U.S., to parents for every child younger than six years old.
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Not surprisingly, the benefit has prompted debate. Maria Minna, a member of Parliament and a former chairwoman of the Liberal caucus committee on social policy, says the Conservatives' new program amounts to "social engineering" that tells moms "they should stay home. How dare they? Who are they to dictate what women should do?"
That is not the goal of the benefit, says Colleen Cameron, a spokeswoman for Human Resources and Social Development Minister Diane Finley. "It is not intended to persuade women to make one decision or the other," Ms. Cameron says. "It's designed to support women in the choices that they make."
But while Canadians argue over the merits of the benefit and who should receive it, economists are watching to see whether the new plan will undercut a decade-long stream of Canadian women into the work force. Although the government isn't offering enough money to create an exodus of mothers from the workplace, it could "lead to some incentive for one spouse to stay at home," says Kevin Milligan, an economist at the University of British Columbia in Vancouver. "The prediction would be that there would be fewer women working. It could have an impact."
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To be sure, Canada's various tax breaks under the Liberal government weren't designed to get more women to work. Rather, they were intended to ease the tax burden on low- and modest-income families and to reduce childhood poverty.
But that is not a priority for the current government. Political analysts say the new child-care payment is one of several policies designed to help Conservatives build support among their affluent base as they gird for the next election, which could come within a year. Though they won more seats than any of the other three parties in last January's election, the Conservatives don't have a parliamentary majority. So-called minority governments in Canada typically last only about 18 months.
The child-care payment may be particularly popular in Mr. Harper's home province of Alberta. According to federal statistics published this spring, a big drop in female work-force participation in the oil-rich western province led to a slight decline in Canada's female labor-force participation between 2004 and 2005, with the percentage of working women falling to 73.1%.
With wages in Alberta growing 7% a year, economists say a "wealth effect" from the oil boom may be enabling families to forgo a second income so Mom can stay home. Now, those mothers will have some extra pocket money.
- reprinted from the Wall Street Journal