All parties need to revisit their social spending priorities heading into the federal election
Family policy is front and centre in the lead up to the October federal election. The Conservatives and the NDP have already weighed in, putting billions on the table. Facing critique he favours style over substance, Liberal leader Justin Trudeau now offers some specifics of his own by promising to consolidate federal child tax benefits.
We at Generation Squeeze crunched the numbers to see how families were fare under the three parties in the year after the election.
Follow the money
The Conservatives would inject $4.6 billion in new money for families with children via income splitting and the expanded Universal Child Care Benefit (UCCB).
The NDP promises to keep $2.6 billion budgeted for the expanded UCCB, but not other money earmarked for income splitting. Instead, it will add $595 million to achieve its long-term vision of $15/day child care. This brings the NDP investment to $3.2 billion.
The Liberal plan would reallocate funds from income splitting and the UCCB along with other child tax credits to create one consolidated Canada Child Benefit. It would then add in another $2 billion. This makes the Liberal investment $6.6 billion – billions more than both the Conservatives and NDP.
Who will benefit
The Liberals’ plan spends more and their tax credit is better designed – especially compared to the Conservative plan.
While the Conservative’s income splitting reaches about one-third of families with kids, the Liberals’ plan would spread their entire investment among a broader group of families. In addition, while income splitting delivers the larger benefits primarily to higher earning families, the Liberals would do the reverse and deliver larger benefits to lower and middle income households. Finally, while the design of income splitting and the UCCB reinforces gender roles, the Liberals plan is more neutral about how moms and dads divide paid and unpaid labour.
Tax policy is NOT child care service policy
The Liberals have not yet made specific policy commitments to child care services. This is a major omission because younger Canadians need more time in the labour market than a generation ago to fend off lower earnings and higher housing costs. The Liberals insist they will make further announcements about child care.
The Conservatives state they won’t invest directly in child care services.
The NDP might appear stronger on this issue, with its promise of $15/day child care. However, NDP leader Tom Mulcair will only budget about 5 to 10 per cent of the cost of his promise in the first year after the election. After eight years, he will only put half the money on the table.
The medical care elephant in the room
Mulcair doesn’t talk about it, but the limited funding he intends for child care is tied partly to his approach to medical care. The Conservatives and the NDP both plan to grow the Canada Health Transfer to provinces. But the NDP would allocate billions more than the Conservatives, and do so faster. In three years, the NDP intends to increase annual healthcare spending by more than the entire amount they plan to spend on child care eight years from now. Clearly, $15/day child care is a lesser priority than NDP rhetoric would suggest.
As the Liberal leader ponders how his party should balance spending on medical care with other options like child care, it’s worth acknowledging that Canadians don’t get much bang for their medical care buck. Evidence shows Canada spends more on medical care than many other rich countries, but delivers only middling or below average access to doctors, CT scans, MRIs and patient satisfaction. We do, however, get well-paid doctors.
Generation Squeeze and the Canadian Public Health Association are presenting a half-day session at their annual meetings that will explore how to contain the growth of medical care spending precisely because evidence shows other uses of the funding would better promote health. All political leaders should take note, and revisit their own social spending priorities heading into the federal election.
By Paul Kershaw
Dr. Paul Kershaw is Founder of Generation Squeeze (gensqueeze.ca), and a policy professor in the University of BC School of Population Health. Many young Canadians say they don’t vote because it’s difficult to discern the key differences between party platforms. Generation Squeeze aims to fix this by serving as a trusted, absolutely non-partisan source of analysis about party platforms.