The Liberals ushered in the option of an 18-month parental leave with the 2017 federal budget — but it comes at a cost.
Parents will need to stretch out their Employment Insurance (EI) benefits, opting to receive a lower rate of 33 per cent of average weekly earnings for 18 months. Parents may also choose to stick with the 12-month leave at a benefit rate of 55 per cent.
READ MORE: Federal budget 2017: What does an 18-month parental leave mean for Canadian employers?
Some parents argue that the benefits already don’t pay enough — the max payout is $543 per week. Spreading that out to 18 months works out to a maximum of $362 per week.
Having a baby isn’t cheap, and the expenses begin before the bundle of joy even arrives.
“All the gear that you need to buy goes from a couple of thousand dollars if you’re trying to buy used stuff, and way, way up,” said Alisa Fulshtinsky, founder of the Toronto Mommies online support group.
Then there’s the day-to-day needs — diapers, formula — not to mention long-term or surprise expenses.
“There’s always other costs you don’t anticipate,” Fulshtinsky said.
Toronto Mommies was behind a petition that urged the Liberals to extend parental leave; it nabbed more than 100,000 signatures. Fulshtinsky said while the group had hoped to have the 55 per cent payment rate extended for the 18 months, they understand the limitations.
READ MORE: Federal Budget 2017: Liberals extend parental leave to 18 months, boost childcare funding
“Realistically, that would be a huge change to the budget and a big expense,” Fulshtinsky said. “I think it’s an important first step and we’re excited.”
“We are hoping that it’s not the end of the dialogue.”
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For families fortunate enough that finances aren’t a huge issue, having the option to extend your leave is priceless, said Marie Bountrogianni, dean of Ryerson University’s Chang School of Continuing Education.
“Any policy that gives families options of spending more time with their newborn babies, children [and] toddlers, is positive for the family.”
However, some new parents don’t receive parental leave benefits at all.
About a third of couples don’t qualify, said Jennifer Robson, author of a recent Institute for Research on Public Policy study. While change is underway, she said, more attention needs to be paid to the issue.
“We need to have a longer-term conversation about the role of special benefits in the system,” Robson said.
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Along with breaking down the barriers in place for those who don’t qualify, Robson would like to see the Canada Child Benefit harmonized with parental leave. Family supplements, a targeted top-up for lower-income families, could also use a revamp, she noted.
This isn’t the first time parental leave has been extended since it was first created, she said, pointing out that past changes have yielded positive results.
“Labour market participation has not declined overall with the maternity leave changes seen over the last 46 years,” said Robson.
The latest changes won’t happen overnight (it’s expected the 18-month option might begin in 2018). There will need to be legislative amendments to the EI Act and federal labour code — and then provincial labour codes will have to follow suit.
“Benefits are no good if you don’t have the job protection,” Robson said.
With job security, women might make the choice to spend that extra time with their child rather than pay for costly daycare. It might even come down to weighing the cost of daycare versus wages.
“Some daycares, for kids under 18 months, will run you $2,200 in downtown Toronto — and you’d be lucky to get a spot,” Fulshtinsky said.
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After the age of 18 months, the cost for care decreases by a few hundred dollars a month — that is, if parents can find a spot for their child.
At the end of the day, the 18-month leave option might not cough up more dough, but it does offer more flexibility.
“Choice and flexibility is a good thing for families, giving them more opportunity to decide — does 12 months make more sense, or does 18 months make more sense?” Robson said.
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