Mr. Speaker, I will be splitting my time with the member for St. John's East.
I am pleased to rise today as the Parliamentary Secretary to the Minister of Justice to speak to an important aspect of Bill C-78, which is poverty reduction.
Over two million Canadian children live in separated or divorced families. Of these, lone-parent families are the most financially vulnerable of all family types and are more likely to depend upon social assistance.
There are couple of other important statistics.
Right now, there is well over $1 billion in support payment arrears in this country. In the vast majority of such cases, 96% of all such cases, the arrears relate to money owed by men to women.
The data on the economic challenges of single parenthood are quite stark. In 2016, the median net worth of Canadian couples with children under 18 was over $300,000, while the median net worth of single-parent families was less than one-sixth of that, $57,200.
Separation and divorce can cause a financial crisis for some families. The benefits of sharing family expenses often disappear as a second home must be established. Some parents need to significantly change their work hours to accommodate their changed parenting schedule, which can affect their income and their employment opportunities. This is what I hear when I speak to families in my riding of Parkdale—High Park. I hear far too often from single mothers who are struggling to access spousal and child support after a marital breakdown. Bill C-78 will directly benefit these residents of my community and the residents of so many other communities in a similar situation right across Canada. It will help lift those individuals, whether they are mothers or children, out of poverty. It will mean less time fighting out support payments in court, which is costly and time consuming, and creates a court backlog. It will mean more tools to allow single parents to identify and locate the assets of their former spouses, and more tools to enforce the actual payment of spousal and child support to single parents and their children.
Allow me to explain. I want to first turn to the payment of child support reducing the risk of poverty.
The sooner a fair and accurate amount of child support is established after parents separate and payments are made, the better the outcomes are for the child in question. The payment of child support is a key factor in reducing the risk of child poverty, especially for low-income, single-parent families.
Parents have a legal obligation to support their children financially after separation or divorce. Children have a legal right to that support. Federal, provincial and territorial child support laws require parents to disclose specific income information, including income tax returns, and set out penalties and consequences if a parent fails to disclose this information. This includes imputing income, which means that the parent’s income is assumed to be a certain amount for child support purposes, and the child support order is based on that income.
Most parents dutifully meet their legal obligations. However, some parents do not provide complete and accurate income information, despite the possible penalties and consequences. This is a significant issue that has serious consequences for children and families going through the family justice system, as well as for the system as a whole.
Family law practitioners and judges often say that income disclosure issues are one of the most contentious areas of family law. Failure to comply with disclosure obligations can put significant pressure on the family justice system. It may also discourage parents from reaching agreements through family dispute resolution processes, such as mediation. If income cannot be properly determined at the outset, it may also prevent families from benefiting from other family justice services such as administrative child support calculation or recalculation services.
I want to turn now to the costs associated with the non-disclosure of income.
The financial and emotional costs to parents seeking income disclosure are significant. They are legally entitled to financial information from the other parent. However, when financial disclosure is not made, they must ask a court to order that the information be provided. This creates significant costs for families and can lead to overburdening of the family justice system, including the courts. The other parent may still not disclose his or her income information, even after the court has ordered it. In these situations, the court may then impute the income of the other parent.
Although imputing income may work adequately in some situations, it is very difficult for the court to determine a fair amount of support that reflects a parent's true ability to pay in the absence of complete and up-to-date income information. Imputing income may result in child support amounts that are too high, which, in many situations, will not be paid or result in support payments that are too low and thereby prevent children from benefiting from the support of both parents.
Consistent with our government's commitment to poverty reduction and to meeting the needs of low- and middle-income families, Bill C-78 would bring much needed changes to middle-class Canadians. It would limit the negative consequences of income-related disputes for the family justice system and parents. Bill C-78 also proposes much needed changes to help reduce child poverty.
I will turn to one aspect of the law that would be amended here, the Family Orders and Agreements Enforcement Assistance Act. Amendments to this act would ensure that a separating or divorcing parent's failure to meet their income disclosure obligations would not prevent the establishment of a fair and accurate amount of support. We would amend this particular law to allow the federal government to release an individual's income information, including information from tax returns, to a court for the purpose of establishing, varying, or enforcing a support provision.
The income information to be released would be listed in the regulations, and important safeguards would be included in the act. An application for information under this legislation would not be permitted if the court were of the view that a release of information would jeopardize the safety and security of any person. Where information is released to a court, it must be sealed and kept in a place to which the public has no access.
The release of this income information would help ensure that child support amounts reflect the parent's true capacity to pay. It would also reduce legal costs associated with ensuring income disclosure for a parent, as well as the associated use of court resources. Child support orders would be made more quickly, more accurately, with less conflict and less expense, helping the very women I mentioned at the outset, the 96% of recipients of spousal and child support in Canada who are women.
The legislative amendments we are proposing will also allow the disclosure of income information to child support recalculation services. Recent information on a parent's income is needed so that those provincial and territorial recalculation services, which provide an administrative service, can do their job. They are an important tool in ensuring access to justice for parents who pay or receive child support. These services help update child support amounts through a process that is fast, more effective, low cost and non adversarial.
These recalculation services recalculate the amounts indicated in child support orders and agreements based on a parent's current income. However, they cannot proceed with the recalculation on income allocated or when no income information has been provided. In such cases, parents have to go through the courts to amend the child support amount.
These amendments to the act will reduce costs, not only for parents but also for the justice system, by allowing administrative services to recalculate to obtain the income information they need. Agreements with the provinces and territories on the disclosure of information will be updated in order to guarantee the protection of income information disclosed to the services responsible for doing the recalculation.
Bill C-78 also proposes amendments to the garnishment provisions. This act provides for the payment of salaries and pension benefits payable to current and former federal employees to another person to help satisfy family support. Amendments to the legislation would help reduce child poverty by making the process more efficient so that families receive the support they are entitled to in a timely manner. For example, the amendments would prioritize garnishment for family support debts over all other debts, other than debts to the Crown, which allow for earlier garnishment where possible.
In conclusion, separation and divorce can be difficult emotionally and financially for families and children. That most Canadians dutifully meet their obligations when it comes to both the establishment and payment of child support is a testament to our society's values. However, when parties cannot agree on what their obligations should be, our family justice system should be there to help resolve those issues. Federal enforcement legislation is there to help when parties do not meet their support obligations. That is exactly what Bill C-78 would do. I am proud to support it, and I urge all members of the House to do the same.