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Canada Child Benefit should increase with inflation, anti-poverty group says

An anti-poverty group is calling on the federal government to make a small change to its key measure to combat child poverty rates to ensure families aren't left behind as the cost of living rises. Anne Christine / Getty Images

OTTAWA – An anti-poverty group is calling on the federal government to make a small change to its key measure to combat child poverty rates to ensure families aren’t left behind as the cost of living rises.

In its annual report to be released Thursday, the group Campaign 2000 says the Liberal government’s new income-tested child benefit could fall short of its lofty goals because it isn’t automatically adjusted to combat rising food and housing prices.

Earlier this year, the parliamentary budget watchdog calculated that 200,000 fewer families would be eligible for the benefit by 2021, with that number continuing to drop as some families see their income levels rise.

READ MORE: New Canada Child Benefit’s buying power to fade over time

In 2020, one year after the next federal election, the Liberals intend to index the Canada Child Benefit to inflation to maintain the buying power of the monthly payments – the so-called “real value.”

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The report urges the government to make that change starting next year, and to make the benefit available to failed refugee claimants and others seeking humanitarian and compassionate consideration of their cases.

The group also wants the Liberals to rethink their proposed tax changes to provide more help to lower-income Canadians, target middle-income earners and raise rates on higher-income earners to help pay for needed social programs and infrastructure.

“Often we hear that the fiscal situation doesn’t allow for this or that social program that can lift families out of poverty, and indeed help the middle class achieve the goals that the middle class has,” said Anita Khanna, the group’s national co-ordinator.

“We’re looking for government to take more leadership in this area as well to make sure we are building Canada’s fiscal capacity and addressing the gaping divide in our society between the rich and the rest.”

READ MORE: Canada Child Benefit expected to boost back-to-school spending

Using tax filing data, Khanna’s group calculates that about one in every five children in Canada is living in poverty. The ratio is even higher – three out of five – for aboriginal children living on-reserve.

The current situation could be even more bleak: the data underpinning the report dates back to 2014, leaving a two-year gap that doesn’t account for the steep decline in oil prices in recent years.

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The new non-taxable, income-tested child benefit rolled out in July with the average family receiving an additional $2,300 annually under a program that was a cornerstone of the Liberals’ campaign platform.

The Liberals predict the child benefit will help lift about 300,000 children out of poverty.