Mr. Speaker, I am pleased to have the opportunity to participate in today's debate.
The motion before us relates to a topic dear to every member of this House and to Canadians everywhere: the well-being of our children. Indeed, the matter is so important that we must be especially vigilant to ensure that we think about it as clearly as we can. Unfortunately, the motion as proposed tends not to clarify but rather to obscure some very important points about the purpose of the child care expense deduction, about genuine tax fairness, about
fiscal responsibility and about the important steps this government has taken to advance the well-being of Canadian children.
Let me begin with the first point, the purpose of a child care expense deduction.
As we have already heard, the child care expense deduction is designed to help modest income families with two working parents shoulder the child care expenses they must incur in order to earn an income or to study. In other words it exists to help ensure that the tax burden of these families is fair compared to those with similar incomes who do not face these additional expenses.
This leads me to another point that deserves to be emphasized. The existing system is designed to assist parents with modest incomes. In these tough fiscal times if not always, it would be unrealistic and even unfair to use taxpayers' money to introduce new benefits that would largely go to affluent Canadians.
These are issues that by themselves are sufficient to show why today's motion does not deserve the support of this House.
There is another important point I would like to turn to now. That is to remind hon. members of the important steps, the targeted steps our government has taken to advance the well-being of children, especially those of families in need.
In fact, despite the austerity we are forced to come to terms with, the federal government continues to provide significant support, through the child tax benefit, to low and middle income families with children. These benefits are tax exempt; they are revenue based and paid monthly.
Maximum payments go to families with net incomes below $26,000 and include a basic benefit of $1,020 per child, as well as an additional $75 for the third and each subsequent child in the family.
In addition, there is also the child tax benefit supplement which specifically helps parents who stay at home to raise their preschool age children. This supplement provides modest income families who do not have deductible child care expenses with an additional $213 for each child under the age of seven.
Beyond this, federal assistance to families with children is further enhanced by the working income supplement. This supplement helps low income working families meet some of the extra costs related to earning employment income. It is important to recognize that the working income supplement is not just limited to two income families but also applies to single earner families where one spouse stays home as the caregiver.
The bottom line for this program is both clear and considerable. The total annual cost of the child tax benefit including the working income supplement is over $5 billion.
It is also vital to note that these are not static programs. This government recognizes that the issue of child hardship and poverty is of growing concern to us all. That is why we have taken effective, targeted action to enhance them.
For example, until the 1996 federal budget the maximum value of the working income supplement was $500 annually. The budget doubled this benefit to $1,000 to be phased in over two years. Over 700,000 working families will benefit from the increased working income supplement. The average benefit they will receive will increase from $350 a year to $700. About 250,000 families will receive the maximum increase of $500. When this measure is fully implemented in July 1998, benefits to low income working families will be enhanced and enriched by $250 million a year. I would add that about one-third of the families that will benefit from the increased working income supplement are single parent families.
I would also like to mention another important measure in last year's budget which will help families with children. In fact it will help them with one of the most important investments a young person in his or her family can make for the future and that is education.
I am referring to the learning package, an additional $80 million a year in tax assistance to help students and their families deal with the increased costs of education. Students receive assistance with their educational costs under two tax provisions: the tuition fee credit and the education credit. As tuition fees rise, the amount of assistance provided by the tuition fee credit rises automatically.
In the 1996 federal budget the amount on which the education credit is based was increased from $80 to $100 per month. In addition, the limit on the transfer of tuition and educational amounts, for example from a student to her parents, was increased from $4,000 to $5,000. Moreover the annual limit on registered education savings plans contributions was increased from $1,500 to $2,000 and the lifetime limit was raised from $31,500 to $42,000.
Finally, we have also taken action to improve the child care expense deduction, the issue at the heart of today's debate.
The 1996 budget broadened eligibility for the child care expense deduction by allowing single parents studying full time to receive the benefit and deduct it from all other income. Families with both father and mother studying full time may enjoy this benefit as well.
Furthermore, and this is a first, the benefit is now available to parents completing high school. At the same time, the age determining deduction eligibility has been raised, thus enabling parents with older children to take advantage of the deduction.
The measures I have just set out have provided considerable support to many children and parents in Canada, but I am not claiming that these measures alone are enough.
Surely there is more that could and should be done but in this period of limited resources we have to make sure that we are doing the most good we possibly can do with every dollar we spend. On this score the measure before this House fails miserably. It is proposed without regard to cost; incredibly it is proposed without regard to need and without regard to impact. Everyone agrees that we must do the very best we can for our children. To that extent I appreciate the intent of today's motion, but is it really the best we can do? Would children in need derive the most benefit? I think not.
What is needed is for better thought out and better targeted proposals to be brought before this House. But typical of the party opposite, we have simple solutions offered to complex problems.
However, today's debate and for that matter every issue under debate in this House would be of national interest only if it were grounded on clear intentions and proposals of substance, which must be expressed in clear terms and accompanied by accurate figures. Today's motion miserably fails the test on both counts.
The Reform Party claims it is concerned about families, about family time, about providing a better standard of living and care for Canada's children, but in its proposals here today and in other venues it proves conclusively that it places no real priority on child poverty and has little true understanding about family life in the 1990s.
Families with two working parents exist for a number of reasons. Financial need is just one. The operation of the tax system might be another but it is not the sole reason that parents make a decision to stay home or seek work outside the home.
Reform has nothing to offer the majority of Canadian families who must or choose to have both parents work. Even more troubling, today's motion dares to suggest that tax fairness would be enhanced by providing a credit to every family irrespective of income level. This simply means to a host of families who enjoy material benefits which low and modest income families can only dream of that they would benefit even more.
The real agenda here is very clear. Reform has staked out a policy of a broad national tax cut, a policy that has not won the hearts of very many Canadians. Canadians see through the cheap appeal of Reform's tax proposals. Those Canadians are the ones with real common sense. They will not allow governments to buy electoral success by promising rapid and wide ranging tax reductions. Canadians will not be fooled by this phoney reform of the human face. When communism was collapsing in eastern Europe we started to hear about communism with a human face. That is what is happening here. Canadians will not be fooled by this political cross-dressing.
In closing, there is no politician who would not like to lower taxes as far as possible. But good government means acting with constraint and consideration and making sure that today's tax cuts do not come at the price of increased pain and suffering tomorrow for those who are most vulnerable. That is why this government has opted in its three budgets to take targeted action that works within our fiscal conditions and that serves those who are most in need.
That is what real political leadership and nation building is about. It is not about picking winners and losers. And because today's motion does not meet those tests of real leadership, does not increase real tax fairness and does not focus its benefits on those most in need, I have no hesitation whatsoever in urging all hon. members to vote against today's superficially appealing but essentially misleading motion.