House of Commons Hansard #78 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was child.

Topics

Interparliamentary Delegations
Routine Proceedings

10 a.m.

Liberal

John English Kitchener, ON

Mr. Speaker, pursuant to Standing Order 34(1), I have the honour to present to the House in both official languages the report of the Canada-Europe Parliamentary Association on the fifth annual meeting of the parliamentary assembly of the OSCE, the Organization for Security and Co-operation in Europe, held in Stockholm, Sweden from July 5 to July 9, 1996.

Interparliamentary Delegations
Routine Proceedings

10 a.m.

Liberal

John Maloney Erie, ON

Mr. Speaker, I have the honour to present in both official languages the report of the Canadian delegation to the seventh annual meeting of the Canada-Japan Interparliamentary Group which was held in Toronto, Montreal and Ottawa from September 1 to September 5, 1996, as well as the report of the executive committee meeting of the Asia-Pacific Parliamentary Forum held in Ottawa from September 6 to September 8, 1996.

The Asia-Pacific region is becoming increasingly important in Canada. Japan is now our second largest trading partner. Asia has become Canada's second most important trading region.

The recently completed seventh annual Canada-Japan meeting focused on our growing and harmonious bilateral relationship. Discussions focused on bilateral and multilateral co-operation in a rapidly changing world. Relations with our other Asia-Pacific neighbours are also changing.

Canada will be hosting the fifth annual meeting of the Asia-Pacific Parliamentary Forum in January in Vancouver. The executive committee of the APPF just held a highly successful and productive meeting here in Ottawa and approved the arrangements for the Vancouver meeting. We look forward to hosting this meeting and to kicking off Canada's year of Asia-Pacific.

Committees Of The House
Routine Proceedings

10 a.m.

Liberal

Bill Graham Rosedale, ON

Mr. Speaker, I have the honour to present in both official languages the second report of the Standing Committee on Foreign Affairs and International Trade on Bill C-54, an act to amend the Foreign Extraterritorial Measures Act. The committee has agreed to report this act without amendment.

Committees Of The House
Routine Proceedings

10 a.m.

Fundy Royal
New Brunswick

Liberal

Paul Zed Parliamentary Secretary to Leader of the Government in the House of Commons

Mr. Speaker, I have the honour to present the 33rd report of the Standing Committee on Procedure and House Affairs regarding the membership and associate membership of some committees.

If the House gives its consent, I move that the 33rd report of the Standing Committee on Procedure and House Affairs be concurred in.

(Motion agreed to.)

Petitions
Routine Proceedings

October 1st, 1996 / 10:05 a.m.

Liberal

Maurizio Bevilacqua York North, ON

Mr. Speaker, pursuant to Standing Order 36, I am pleased to present to the House three petitions which focus on Canada's economy, signed by the residents of York North.

The first petition draws the attention of the House to the government's red book commitment to reduce the deficit to 3 per cent of the GDP. The petitioners call upon Parliament to continue to keep its commitment to Canadians and pursue its deficit action so that the government will reach its revised deficit target of 2 per cent of GDP by 1997-98.

Petitions
Routine Proceedings

10:05 a.m.

Liberal

Maurizio Bevilacqua York North, ON

Mr. Speaker, the second petition draws to the attention of the House that in the past year alone short term interest rates have declined three percentage points. For the last two and a half years inflation has averaged less than 2 per cent and by 1997-98 the federal deficit will have been

reduced by $25 billion. The petitioners further draw to the attention of the House that since the Liberal government took office, over 600,000 jobs have been created.

The petitioners therefore call upon Parliament to work diligently to continue to maintain a healthy environment for jobs and economic growth.

Petitions
Routine Proceedings

10:05 a.m.

Liberal

Maurizio Bevilacqua York North, ON

Mr. Speaker, the final petition draws to the attention of the House the important role that small businesses play in our economy. They have created over 85 per cent of new jobs and account for almost 60 per cent of Canada's economic output.

The petitioners further draw to the attention of the House that the government is improving the climate for small businesses by addressing the need for financing, reducing overlap and duplication, increasing access to the information highway and assisting their ventures into exports.

The petitioners call upon Parliament to continue to create a healthy environment for small businesses, to ensure they have the financing they need and to help them explore and capitalize on new opportunities.

Petitions
Routine Proceedings

10:05 a.m.

Liberal

John Maloney Erie, ON

Mr. Speaker, I am pleased to present two petitions today pursuant to Standing Order 36.

These petitions implore Parliament to introduce legislation which would prohibit criminals from profiting in any way from the crimes which they have undertaken.

Petitions
Routine Proceedings

10:05 a.m.

Liberal

Paul Szabo Mississauga South, ON

Mr. Speaker, I have two petitions today.

The first one concerning taxation of the family comes from Calgary, Alberta. The petitioners would like to draw to the attention of the House that managing the family home and caring for preschool children is an honourable profession which has not been recognized for its value to our society.

The petitioners therefore pray and call upon Parliament to pursue initiatives to eliminate tax discrimination against families who choose to provide care in the home to preschool children, the chronically ill, the aged or the disabled.

Petitions
Routine Proceedings

10:05 a.m.

Liberal

Paul Szabo Mississauga South, ON

Mr. Speaker, the second petition comes from Midland, Ontario and concerns labelling of alcoholic beverages.

The petitioners would like to draw to the attention of the House that the consumption of alcoholic beverages may cause health problems or impair one's ability. Specifically, fetal alcohol syndrome or other alcohol related birth defects are 100 per cent preventable by avoiding alcohol consumption during pregnancy.

The petitioners therefore pray and call upon Parliament to enact legislation to require health warning labels to be placed on the containers of all alcoholic beverages to caution expectant mothers and others of the risks associated with alcohol consumption.

Questions On The Order Paper
Routine Proceedings

10:05 a.m.

Fundy Royal
New Brunswick

Liberal

Paul Zed Parliamentary Secretary to Leader of the Government in the House of Commons

Mr. Speaker, I ask that all questions be allowed to stand.

Questions On The Order Paper
Routine Proceedings

10:05 a.m.

The Acting Speaker (Mr. Kilger)

Is it agreed?

Questions On The Order Paper
Routine Proceedings

10:05 a.m.

Some hon. members

Agreed.

Divorce Act
Government Orders

10:05 a.m.

Saint-Léonard
Québec

Liberal

Alfonso Gagliano for Minister of Justice

moved that Bill C-41, an act to amend the Divorce Act, the Family Orders and Agreements Enforcement Assistance Act, the Garnishment, Attachment and Pension Diversion Act and the Canada Shipping Act be read the second time and referred to a committee.

Divorce Act
Government Orders

10:10 a.m.

Prince Albert—Churchill River
Saskatchewan

Liberal

Gordon Kirkby Parliamentary Secretary to Minister of Justice and Attorney General of Canada

Mr. Speaker, I am pleased today to speak in favour of the act to amend the Divorce Act and other acts. Before I get into the details of the amendments I would first like to provide a broader context for the changes.

There is a yearning in Canada today to focus on what we have in common and to return to basic values. Canadians do have values in common. We have not prevailed for 130 years and produced one of the world's most prosperous and successful nations without a foundation of shared principles and beliefs. When we set aside the quarrels about jurisdiction and the forms of the federation, and when we focus on the features that define us as a nation, we will find that what is common to every province and to every region of Canada is our shared values.

We are a society that is compassionate, tolerant and civil. We take pride in social programs that are intended to protect the most vulnerable. We care deeply about our commitment to sharing. These values are reflected in the way we treat our children.

Canadians understand the importance of early intervention of safe and secure childhoods if we are to enable all individuals to

reach their full potential. Canadians also place a strong emphasis on the importance of individual responsibility while governments have a role in helping the most vulnerable. We also believe in people taking responsibility for themselves.

How do these values relate to our strategy for child support? They require laws and policies that produce adequate and consistent child support levels, that respect fathers and mothers who make their payments and ensure that those who are obligated to pay actually do so. Viewed from that perspective, I suggest that the measures we have proposed in our child support strategy very much reflect the fundamental values that unite us.

The starting point is that the nature of the Canadian family is changing. There are more single parent families today than ever. When families divide, there are two households to support and fewer resources to go around and too often the children suffer. Over the past 20 years families headed by an individual parent have doubled in number. There are almost one million such families in Canada. In 1990, 61 per cent of single parent families headed by women lived below the poverty line. This compares to just 10 per cent of two parent families with children.

The steps we are taking to strengthen and improve Canada's child support system will not end child poverty, but we believe these steps will help. These measures derive their value from the shared principles on which they are based.

The principle that children should be first in line. These reforms will put them there and keep them there. Child support is the first and most important obligation for parents.

The principle that a child's standard of living, both before and after divorce, should reflect the means of both parents. These reforms make sure that it does. Children are a shared responsibility and a divorce does not change that.

The principle that people in like circumstances should be treated in a like fashion. These reforms will ensure that they are. Both parents have an obligation to support their children based on their ability to pay.

The strategy we have adopted has four interdependent elements. One, we are introducing child support guidelines to establish appropriate and consistent support levels, and to reduce the degree of conflict between separating parents. Two, we are changing the way child support payments are taxed to make things fairer and simpler. Three, we are enhancing federal and provincial enforcement measures targeting the wilful defaulters to ensure that payments are made in time and in full. Four, we are helping working poor families by doubling the level of the working income supplement of the federal child tax benefit over the next two years. I would like to describe each of these initiatives in more detail.

At the heart of this approach are the guidelines that will be used across Canada by the courts, by lawyers and by parents to establish appropriate levels of support payments for children. At present, courts determine child support levels on a case by case basis. The issue prolongs litigation and adds to the anguish of the parents. Some suggest that the system is based on the principle that every person deserves his or her decade in court. Not all judges take the same approach or have the same philosophy. As a result, levels vary greatly not just across Canada but even within provincial jurisdictions and even from family to family.

The amount that is available to pay for a child's needs should not depend on which province one lives in, to which courtroom the case is assigned or which party has the more persuasive lawyer. The guidelines will establish without the need for trial the levels of child support to be paid according to the income of the person paying. The amounts are calculated by a formula that takes into account average expenditures on children at various income levels. As income levels increase or decrease so will the parents' contributions to the needs of the children, just as they would if the family had remained together.

The guidelines are standard but they are also flexible. No two families are exactly alike. Exceptional expenses for children can be added, such as uninsured medical expenses and child care costs for preschoolers. A court can also change the amounts if undue hardship can be established.

This approach has tremendous strengths. It is simple and it is standard. It ensures that support paying parents with the same level of income pay the same level of child support as other parents. It is also easy to use and in the end it is easy to understand. There will be less reasons for parents to argue about what is and what is not an appropriate level of support. This means less conflict, lower legal bills, reduced legal aid and diminished court costs. The result is that a lot of money which would be spent on lawyers in courts can be kept in the hands of the parents for the benefit of the children.

The second pillar of our child support strategy is a change in the way child support payments are taxed. Currently child support payments are tax deductible for the payer and taxable to the recipient. That rule was put in place 54 years ago. After carefully considering all of the circumstances we have concluded that this approach is unfair and indeed outdated.

To begin with in the present age it is understood that parents do not need an incentive or a reward in the tax system to encourage them to pay support for their children or that a general subsidy by

all taxpayers toward families that are separated and divorced is not appropriate.

In any event the subsidy works best where there is a large income spread between the mother and father which is less and less common. Shifting income patterns have brought their earnings closer together. Where a mother earns the same as or more than the support paying father, the present system actually penalizes her. That is the case in over one-third of all separated couples and that proportion is growing. Even when the incomes are different the subsidy only works if the court takes care in each case to make complex calculations to gross up the amount awarded to take tax into account. This does not always happen in every case. The result is the tax liability eats into the support award and the losers are the children.

Furthermore custodial parents do not want to have to administer the tax system. They are the ones who now have to calculate the amount due and pay it on April 30 of each year whether the support payments arrive late during the year.

More fundamentally, child support is not income for the parent but it is money intended for the children. It therefore should not be taxed in the hands of the recipient.

The reforms will change the system. We are adopting what is known as a no deduction, no inclusion system. That means support paying parents will not be able to deduct their payments from their total income and custodial parents will not be required to include it in theirs. This no deduction, no inclusion approach will not come into effect until May 1, 1997 and it will apply to all new awards made after that date. It will not apply after that date to existing awards unless the parties agree or unless the court directs that the change be made.

We are waiting 14 months before making this change effective for very practical reasons. We want the tax change and the guidelines to become effective at the same time. That way if parties to existing orders want to change their tax treatment the new child support levels can be taken directly from the tables without the need for individual assessment in each case.

We anticipate that the provinces will create complementary guidelines to cover child support levels in cases under provincial jurisdiction so that the systems are uniform. The 14 months will enable them to do that.

Finally, the time will be used in planning for the transition. Ottawa has budgeted $50 million to help the provinces develop simple and effective systems for dealing with the many requests that may be made to varied existing orders once the changes become effective.

In the coming months governments, courts, professionals and other stakeholders will work together so that these cases are dealt with quickly and effectively. The current tax system has been in place for 50 years. I do not think it is unreasonable that we take 14 months to achieve a complete reversal.

Let me address the concerns that have been expressed by some fathers about these changes. First, parents who now have child support orders or agreements will not be forced into a new tax system. Both parents may decide for a number of reasons that their support agreement is working reasonably well and should be left alone.

Second, let me encourage parents to examine the guidelines that we have now published and consider how they may apply to their situations. They are the result of many years of consultations across Canada and they take into account tax levels and average expenses for raising children. The guidelines have been tested not only with family lawyers but with fathers and mothers, both custodial and non-custodial parents.

Third, there may be situations of undue hardship in which the payment in accordance with the guidelines would simply be unrealistic or unworkable. We recognize that cases of hardship do exist and the new process can accommodate those situations.

Finally, we are committed to monitoring these guidelines and if necessary they will be adjusted. Let me restate that in evaluating amounts our eye will remain fixed on the welfare and needs of the children. I think we can all agree on this objective. Of course a fair child support system is more than just setting levels evenly and taxing them fairly. It is also a matter of ensuring that payments are made in full and on time. Enforcement is crucial.

Let me make it clear that a great many parents who make their payments on time and in full deserve our continued respect. They take their responsibilities seriously and they follow through. There are some who cannot pay because of misfortune: they have lost their job, they have fallen ill. They must ask the court to relieve them of their responsibility that they cannot meet. However, there are also too many who are in wilful default.

As of last September almost half of the cases registered with the Ontario family support plan involved child support orders where absolutely no money had been paid. On the remaining half, only one in four was fully paid.

Wilful and chronic default by people who can pay but refuse to pay child support is simply unacceptable in this country. These are not just people who turn their backs on their sons and daughters, they are also walking away from their responsibility as citizens and because they cheat their children all other Canadians are obligated to take up the slack.

The prime responsibility for enforcement of child support orders currently rests with the provinces. A lot has already been done by the provincial agencies but the Canadian government also has a role to play, a role of leadership in co-ordinating, encouraging and complementing the provincial efforts.

The measures we are proposing will support and enhance the strategies of provincial and territorial governments. We want to work with them in a common cause. There is a list of measures that we will now take. Let me mention just a few of them.

Federal legislation will authorize the suspension of federal licences and certificates such as passports in the cases of persistent default. It will allow access by the provinces to the database of Revenue Canada to help trace persistent defaulters. It will invest money and effort in upgrading computer systems to share information among provinces to co-ordinate their efforts.

The fourth pillar in the child support strategy involves a measure that is intended to help working poor families whether they are separated or still living together. The Canadian government contributes to basic income security for children through a child tax benefit.

One component of that benefit is the working income supplement which provides a non-taxable benefit to supplement the employment earnings of families with net incomes below $25,900. At present, the maximum amount that is payable under the working income supplement is $500 per family each year. Over the next two years the Canadian government will double that supplement to $1,000 per family each year.

The revenue derived from ending the deduction on child support payments will be used to fund the increase in the working income supplement. The result will be that over the next five years over $1 billion of additional revenue will be put into the hands of about 700,000 low income families in the labour force. About one-third of them will be lone parent families.

The advantages of this strategy are obvious. The increased working income supplement is tax free and will go right to the bottom line for families that need dollars for their children. This supplement is distributed fairly, benefiting children of separated families and families that remain intact. And the working income supplement is targeted to those most in need.

What will make these reforms work well is that they will work together. Guidelines will ensure consistent awards at appropriate levels with diminished conflict and expense.

A tax rule that reflects the social conditions and values of 1942 will be changed to conform to current needs and trends. Effective tools will enhance enforcement so that good people who make their payments will know that those in wilful default will be pursued. Every dollar of increased revenue that Ottawa derives from the tax change will be ploughed directly back into a system for the benefit of children in low income working families.

I invite the support of members of the House and their involvement in making this strategy succeed. Working together, Canadians can put children first. The government will put children first. It will put responsibility fairly on the shoulders of parents and and make our system of child support one of which we can all be proud.