Transition Child Benefit important for all
Children living in poverty would be further harmed by program’s cancellation
On July 31, 2018, the Ontario government announced a 100-day review of the province’s social assistance system. More than a year later, the review is still to appear. Nevertheless, decisions are beginning to trickle out. One of them is the planned cancellation of the Transition Child Benefit (TCB). To most, this sounds pretty minor. After all, what could be so important about something that is “transitional”?
The TCB goes all the way back to the introduction of the Ontario Child Benefit (OCB) in 2007. THE OCB is a refundable tax credit going to all lowand modest-income families in Ontario. Today, it provides up to $1,434 per child every year to more than 500,000 Ontario families.
When this benefit began to be paid through the tax system in 2007, Ontario was able to remove the allowance for children’s food, clothing and other basic necessities (except shelter) from the social assistance rate schedule. Most social assistance recipients were a little better off because the new OCB was more than the amount they had been getting for their children’s basic necessities.
But, inevitably, there are some families not getting the OCB, almost always because they are waiting for their tax-based credits to begin. They include families with newborns, families experiencing breakups and refugee claimants.
Some of these families have little or no other income and have to turn to social assistance to tide them over. But the allowance for basic necessities for children is no longer part of the regular social assistance rate schedule.
This is where the TCB comes in. So it turns out that cancelling the transitional benefit is not some trivial adjustment: it will leave thousands of families in Ontario in extreme poverty without the means to provide their children with food and clothing. Today, about 16,000 children receive the TCB, which is approximately 10 per cent of all children in families receiving social assistance. A single parent with one child could lose about 20 per cent of their already poverty-level income.
The total annual cost of the TCB is $67 million, an estimated 0.7 per cent of the total cost of social assistance in Ontario. A program that provides 10 per cent of children receiving social assistance with basic necessities, at less than one per cent of total social assistance program costs, is good
value for money.
This cut probably amounts to eliminating the least costly item in the whole social assistance budget with the most impact on reducing extreme poverty.
The elimination of the Transition Child Benefit will have downstream impacts on other services like housing and health care. The long-term costs could easily outweigh the shortterm savings.
More importantly, the loss of this income will leave scars for some of our most vulnerable children and their families for the rest of their lives.
In the end, all of Ontario will lose.
Michael Mendelson is a fellow at Maytree and a former Ontario deputy minister.