Mr. Speaker, I thank the hon. member across the way for saying “this will be good”. I hope he appreciates that.
I am pleased to speak to this private member's motion. It certainly reflects a concern for children and families, which is commendable and which the government fully shares. That philosophy was reaffirmed in last fall's Speech from the Throne which stated:
One of our objectives as a country should be to ensure that all Canadian children have the best possible opportunity to develop their full potential.
That objective may appear in harmony with today's motion which suggests that government consider providing tax relief for parents who enrol their children in youth activities. While the intent is admirable, I am afraid the motion fails some important tests both in terms of priority and practicality.
To explain, I want to begin by reminding the House that the federal tax system already provides significant assistance to low and middle income families with children through the Canada child tax benefit. It represents an investment of over $5 billion a year and is growing dramatically. In the last two budgets the government dramatically increased the annual assistance provided to low and middle income families through the child tax benefit.
Since July 1997 over 720,000 low income working families have received increased benefits as a result of restructuring and enriching the working income supplement. Overall benefits have increased by $850 million over three years.
Again, as announced in the 1998 budget, the government will add a further $425 million in July 1999 and another $425 million in July 2000.
I want to step back to Motion No. 306 and the issue of priorities. First, the government's dramatic fiscal progress and our capacity for new investment are still quite limited. We must make sure that investments including tax cuts meet the key priority of doing the most good for those with the greatest need.
The child tax benefit does this by targeting aid to low and middle income families. However, today's motion would represent a new and costly tax break and one that could provide the greatest share of the benefit to affluent families, in fact those who need it least.
Of course the cost of this motion would depend on the parameters applied such as the level of credit or the number of children for which it could be claimed. However, let me give a mid-case scenario as an example.
Let us assume for the moment a thousand dollar tax credit at a rate of 17%. In other words, a tax benefit of $170 for each eligible child is in place. If this was claimed by the parents of just half of all Canadian children, the cost would be about $570 million a year. That is a substantial amount of money.
A practical problem with this motion is the following. How should we define appropriate youth activities? Should the government be subsidizing golf or tennis lessons? Where do we draw the line between personal development and leisure?
Remember, parents of modest means can use the child tax benefit to help their children undertake youth activities if they feel that this is a good use of their family resources.
It reflects an important aspect of our tax policy and operating philosophy. We feel it is parents who are best placed to decide how the financial resources of their family should be allocated.
By creating a special tax break just for youth activities, it is the government that is determining family priorities.
Let me step back to the issue of what would qualify as an appropriate youth activity. Consider the administrative problems and costs of determining eligible activities requiring parents to provide receipts, and then processing these claims, all on top of a tax system which I am sure the hon. member opposite would agree most people already find quite complex and time consuming.
On the issue of what would be an eligible youth activity, there is a final point that I would like to make. The government already provides real tax assistance to many activities that would clearly qualify under the hon. member's motion.
Boy Scouts and Girl Guides, for example, are done through the tax exempt status of charitable or non-profit organizations. Because they are income tax exempt, they are able to offer their programs to members at a lower cost, making them accessible to the widest range of Canadians. It appears to me that this is an efficient, effective and fair method of meeting the same fundamental goal in today's motion.
In conclusion, it should be clear why this House cannot endorse today's motion. First, it would be a very costly addition to our already expanding program of tax assistance to families with children.
Also, it would provide assistance to many families that need it least without giving real aid to Canadian children and families in real jeopardy. Then it would be costly and difficult to administer.
Finally, the motion ignores the fact that there is a form of tax assistance, exemption for charitable and non-profit organizations, that already helps many youth activities and the involvement of children.
Considering this, we should have no hesitation in rejecting today's well intentioned but flawed motion. As I pointed out, government provides over $5 billion of assistance to families with children and is enriching that assistance.
This is a better way to help children than that proposed in this motion.