Federal Budget 2017: Liberals extend parental leave to 18 months, boost childcare funding

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Federal Budget 2017: Liberals extend parental leave to 18 months, boost childcare funding
WATCH: What changes are coming to child care and parental leave after the release of the 2017 budget? – Mar 22, 2017

Correction: A previous version of this story stated the budget left the caregiving benefit for families of critically ill children unchanged. This has been corrected.

In a budget that contained little additional spending and few new measures, there was a fair bit of change for Canadian families.

Here’s what’s new:


The government set aside $7 billion in new spending over 10 years for early learning and childcare programs. That comes on top of $500 million for one year pledged in the 2016 budget.

The funding could serve to create more affordable childcare spaces for low-income families, the budget said.

In practice, however, “in the provinces that don’t cap child care fees, that’s unlikely to happen,” David Macdonald of the Canadian Centre for Policy Alternatives told Global News.

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READ MORE: Liberals reveal the 2017 federal budget

The only provinces that have set limits on such fees are Quebec, Manitoba and P.E.I. Everywhere else, Macdonald said, the provinces are more likely to use the money to create additional spots, rather than bring down costs.

Although some of the funding will be earmarked for Indigenous children, it doesn’t seem that the government’s focus is on making childcare assistance more narrowly focused on Canadians who truly need that financial help, according to Ian Lee, associate professor at Carleton University’s Sprott School of Business.

The $7 billion wouldn’t be evenly distributed through the 10 years, but ramp up gradually from $540 million next year up to $870 million in 2027.

Parental leave

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The Liberals have also made good on their campaign promise of extending parental leave and benefits to 18 months.

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Parents who choose to stay at home longer, however, will have to make do with a lower Employment Insurance (EI) benefit rate of 33 per cent of their average weekly earnings, instead of the current rate of 55 per cent.

WATCH: Mother tells us how extending parental leave to 18 months would affect her

Click to play video: 'Mother tells us how extending parental leave to 18 months would affect her'
Mother tells us how extending parental leave to 18 months would affect her

Canadians will still be able to opt for the traditional 12-month leave at the higher benefit rate.

READ MORE: How the 2017 budget will affect your pocketbook

Being able to stay at home for longer may help some parents find more affordable child care spots, as spaces for toddlers are generally cheaper than for infants up to age 18 months.

Still, the change does little for low-income parents, who generally can’t access EI, Macdonald said.

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In another tweak to EI, the budget also introduces the possibility for pregnant women to access maternity benefits up to 12 weeks before their due date. That’s up from the current eight weeks.

Caregiver benefit

The government is also amending EI to introduce a new caregiver benefit that’s meant to help families cope with illnesses and injuries that, while serious, don’t entail an end-of-life situation.

Right now, EI assistance for families caring for ill or injured adults only applies when there is a “significant risk of death.” Families in such a predicament can rely on 26 weeks of benefits.

READ MORE: Reality check: Are Trudeau’s changes to old age security a good idea?

The new benefit, which would extend up to 15 weeks, is meant for situations where, for example, a family member is incapacitated by a car accident but expected to make a partial or full recovery.

If the prognosis worsens, families would be able to apply to access 26 weeks of additional EI assistance under the current benefit.

READ MORE: Childcare and parental leave – what could be in the 2017 federal budget

If you break a leg slipping down the stairs, though, this benefit isn’t for you. The injury or sickness has to be severe.

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Parents relying on EI to care for critically sick children will have added flexibility to share the benefit with more family members.

Parents who go to school

As part of a slew of measures to help unemployed and underemployed Canadians go back to school or retrain, the government pledged to introduce a single, higher federal income threshold for part-time students to receive Canada Student Grants.

Grants, unlike loans, don’t have to be repaid.

READ MORE: The biggest losers: What’s missing from the 2017 federal budget?

The measure will allow 13,000 additional Canadians with dependent children to access student grants, the budget said.

Foreign nannies

To help families caring for children or sick relatives, the budget also seeks to make it cheaper to hire foreign caregivers, by waiving a $1,000 processing fee required to obtain a work permit.

For Canadians seeking care for their children, the benefit is available only for families with less than $150,000 in income.

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