Between after-school activities and just keeping them fed as they snatch up all the food in your cupboards, every parent knows that kids can be expensive. But after Tuesday's federal budget announcements, Canadians are buzzing about the increases to our child benefit payments — the tax-free money given to some Canadian parents to help them raise their kids.
In a speech Tuesday, Finance Minister Bill Morneau promised that the new program would “lift hundreds of thousands of kids up from poverty" as parents start getting their money in July.
The new Canada Child Benefit will help families more than any other public policy since universal healthcare. pic.twitter.com/tyepwXhv5w— Bill Morneau (@Bill_Morneau) March 22, 2016
And just how much money will Canadian parents get? It depends. If you earn $30,000 a year and have one child under 6, you could get an additional 533 bucks each month to put toward your child's expenses. And if your household earns $90,000 and you and your partner have one kid under 6 and another between 6 and 17 years old, you could still get an extra $490 a month despite being in a higher earning bracket. It's easy to find out how much money your family is eligible to receive using the Liberal's nifty online calculator.
Canada is by no means the first country to set aside funds to help parents raise their kids. That said, it does look like Canadian parents are getting bigger child care allowances than parents in many other developed countries. Check out how the rest of the world stacks up when it comes to child benefits:
The Germans seem to have a progressive child benefit program — Kindergeld — in that they get that children are often not fully independent after age 17. Parents can claim the allowance for children between 18 and 25 provided their kids do volunteer work approved by the government at home or abroad. But German parents get a little less per month than Canadians from the child allowance program, getting between €190 (C$280) and €221 (C$326) every month for each child. The lower child benefit could reflect the fact that many of German parents' expenses are reduced compared to Canadians' — university tuition is free, after all.
In Japan, there's a special child allowance for single mothers. Single parents get a child benefit for kids up to age 19. A single parent will get about ¥42,000 (C$493) each month for their first child, and the government promises to increase the child allowance for each child born afterward in August. Single parents will soon get as much as ¥10,000 (C$117) for their second child, and up to ¥6,000 (C$70) for any additional kids. Also, low-income families in Japan get reduced nursery school and kindergarten fees. Given that there are around 1.24 million single-mother households in Japan and less than 40 per cent of these women report having regular employment, setting aside funding for single mothers is crucial.
In the U.K., you only get around £21 (C$39) per week for your first child — which works out to roughly £83 (C$155) each month — and then about £14 (C$26) for children under 16 years old from the child benefit program. Parents in higher income brackets, earning over £50,000, can also wind up paying an extra tax on the benefit. One of the good things about this benefit, though, is that it may encourage youth to pursue higher education, as the allowance can be extended to age 20 for a young person who attends a government-approved academic institution. Plus, the government is pretty flexible about what parents can spend the benefit on too, citing everything from birthday and Christmas presents to pocket money.
Luxembourg gives parents a considerably larger child benefit than the U.K. gives, and seems to favour bigger families. For example, you get about €186 (C$275) every month if you have one child, €220 (C$326) monthly for each child if you have two children and €268 (C$396) each month per child when you have three children. Then you also get additional money for school-aged children. Kids between 6 and 11 get an extra €16 (C$24) every month, while those who are over 12 get an extra €49 (C$72). And one of the coolest things about Luxembourg's child benefit is that you can extend it to age 27(!) if your child is a full-time student. Plus, you can also keep getting the allowance indefinitely if your child becomes disabled before age 18.
The U.S. doesn't have a child allowance program. But they do have an Earned Income Tax Credit, which provides a credit to working low-income families. Sadly, it also has one of the highest rates of child poverty in the developed world, topped only by Mexico, Turkey and Chile (according to the Organization for Economic Cooperation and Development). Over 13 million children in the U.S. live in poverty, often in single-mother homes, so clearly more resources for children are needed.
Child poverty is still an issue in Canada too, as nearly 1 in 5 children live in poverty, according to Campaign 2000. Our increased child benefit may not be perfect (personally I'd like to see it extended to help youth finish university), but it's a step in the right direction. Let's hope other countries follow suit.
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