Budget 2016 also announced additional funding of nearly $112 million over two years, the first investment in 16 years into the Homelessness Partnering Strategy, or HPS, to strengthen the work done in communities to support homeless Canadians in finding stable housing.
In short, Budget 2016 puts in place a number of significant housing measures for two key reasons. The first is that we knew there was a crying need for them. The second is that we wanted to send a clear signal that the Canadian government's leadership is being reestablished in response to our families' housing needs.
Speaking of Budget 2016, we would of course be remiss if we did not mention the new Canada Child Benefit, which will ensure that nine out of 10 Canadian families will receive higher benefits than before. On average, these nine out of 10 Canadian families will now receive nearly $200 more per month, and this amount is not taxable. This new monthly benefit is more equitable, simple and fair. Thanks to this new benefit, about 300,000 children, along with 200,000 of their parents, are transitioning out of poverty.
The poverty rate among our children and families will decrease from 11.2% to 6.7%, the largest drop in our country's history, and will result in the lowest child poverty rates in the entire history of our nation.
In addition, we are actively working with our partners in order to find out how this benefit can best support families and First Nations living on reserve and in the North. We are also looking to eliminate all obstacles that could prevent our First Nations families from accessing the Canada Child Benefit.
Moreover, in Budget 2016, we also increased the Guaranteed Income Supplement for Single Seniors. This measure will considerably improve the financial security of about 900,000 seniors throughout the country and lift about 13,000 of them out of poverty through an increase in the Guaranteed Income Supplement benefit, which could reach nearly $1,000.
Finally, we have also concluded an agreement with the provinces to improve the Canada Pension Plan to make up for the fact that many Canadians will likely not save enough for retirement, putting them at risk of poverty in their later years.
As you know, the CPP provides workers with portable, fully indexed, lifetime benefits, and it does so with low administrative and personnel costs.
As lifespans increase, enhancing the CPP will reduce the risk that Canadians will outlive their savings. It will also protect them from market downturns and provide a steady and secure stream of income when interest rates are low.
From a poverty reduction perspective, this enhancement is good news. It will help low-income workers, both now and in the long term. While low-income workers will make contributions for the enhanced CPP, these higher contributions will be more than offset by an increase to the working income tax benefit, also called the WITB, which will lift almost 6,000 Canadians immediately out of poverty in the next few months. In addition, this enhancement will give low-earning households more financial protection in the event of a disability or the death of a wage earner, through higher disability and survivor benefits.
As a result, low-income workers will be better off during their working years, thanks to the WITB, and better off when they retire because the enhanced CPP will boost their total retirement income. For example, if the enhancement were fully in place right now, the number of Canadian families at risk of not saving enough for retirement would be reduced by 25%, from 24% to 18%. Nearly 300,000 families would no longer be at risk. For those still at risk, the degree of under-saving will be reduced substantially. Analysis by Finance Canada indicates that the median after-tax retirement income gap will be cut from $8,300 to $3,700, that is, by more than 50%.
Therefore, not only will the enhancement help to ensure a more secure retirement for middle-class Canadians, it will also contribute to our efforts to reduce poverty now and in the future.
All of these actions I have discussed reflect our determination to reduce social inequality and to ensure prosperity for all Canadians. The study you will be carrying out in the committee will play a large role in achieving this goal.
Mr. Chair, members of the committee, as we continue to partner on addressing poverty reduction in Canada, I would like your views on the questions we have included in our discussion paper.
For example, how do you define poverty? How should it be measured? Are there data gaps that need to be addressed to help improve our understanding of poverty in Canada? What targets should we pick to measure progress?
Reducing poverty requires concerted action. An economist whom I got to know in my earlier life, Amartya Sen, who is also a winner of the Nobel Prize in economic science, said that the success of a society is to be evaluated primarily by the capability that members of a society enjoy, and that poverty is not just a lack of money, but not having the capability to realize one's full potential as a human being.
This all supports our collective and ambitious vision of a prosperous, diverse, and truly inclusive country, a country where all can profit from real and fair chances to succeed.
In closing, I look forward to your contribution, the contribution of your committee in developing a strategy to reduce poverty.
I will be pleased to answer any questions and hear what you have to say.
Thank you.