Archived - Backgrounder on Key Measures Included in Budget Implementation Act, 2016, No. 1

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The Canada Child Benefit

Budget 2016 includes the new Canada Child Benefit (CCB), which is simpler, tax-free, better targeted, and more generous than the existing child benefits. Whether the extra money is used for things such as signing up their children for summer camp, helping cover the family grocery bill, or buying warm coats for the winter, the CCB will help parents with the high costs of raising their kids.

With the passage of the bill, the CCB will provide a maximum annual benefit of up to $6,400 per child under the age of 6 and up to $5,400 per child for those aged 6 through 17. Nine out of ten families will receive more under the CCB than under the current system. Families benefiting will see an average increase in child benefits of almost $2,300 in the 2016–17 benefit year. Hundreds of thousands of children will also be lifted out of poverty.

Actions to Improve Employment Insurance

Budget 2016 takes immediate action to enhance the Employment Insurance (EI) program, so that out-of-work Canadians have the support they need while they look for their next job.

With the passage of this legislation, new entrants and re-entrants to the labour market will face the same eligibility requirements as other claimants in the region where they live. An estimated 50,000 additional Canadians will become eligible for EI benefits as a result of this measure, which will take effect in July 2016. The bill will also reduce the EI waiting period from two weeks to one week, starting January 1, 2017, in order to help ease the financial pressure on those individuals who find themselves between jobs.

Passage of the bill will also extend EI regular benefits by 5 weeks to all eligible claimants, and provide up to an additional 20 weeks of EI regular benefits to long-tenured workers in the following EI economic regions: Newfoundland/Labrador, Sudbury, Northern Ontario, Northern Manitoba, Saskatoon, Northern Saskatchewan, Calgary, Northern Alberta, Southern Alberta, Northern British Columbia, Whitehorse and Nunavut. In these regions, the unemployment rate increased by 2 percentage points or more for a sustained period between March 2015 and February 2016, compared to its lowest point between December 2014 and February 2015, without showing significant signs of recovery.

Improving the Quality of Life of Seniors

Canada’s retirement income system has successfully reduced levels of poverty among Canadian seniors. Nevertheless, some seniors—especially those who are single—continue to be at heightened risk of struggling with low incomes. Budget 2016 took action to ensure that Canadian seniors have a dignified, comfortable, and secure retirement.

The bill will increase the Guaranteed Income Supplement top-up benefit by up to $947, annually, for the most vulnerable single seniors, starting in July 2016. This enhancement more than doubles the current maximum Guaranteed Income Supplement top-up benefit, and represents a 10 percent increase in the total maximum Guaranteed Income Supplement benefits available to the lowest-income single seniors. Representing an investment of over $670 million per year, it will improve the financial security of about 900,000 single seniors across Canada. Upon passage, the bill will also restore the age of eligibility for Old Age Security and the Guaranteed Income Supplement to 65 from 67, which puts thousands of dollars back in the pockets of Canadians as they become seniors.

Teacher and Early Childhood Educator School Supply Tax Credit

Budget 2016 recognizes the costs educators often incur—at their own expense—for supplies that enrich our children’s learning environment. Passage of Budget Implementation Act, 2016, No. 1 will implement a new Teacher and Early Childhood Educator School Supply Tax Credit, in recognition of out-of-pocket expenses for supplies such as paper, glue, paint, games, puzzles, and books for their students. This 15 percent refundable income tax credit will apply on up to $1,000 of eligible supplies in the 2016 and subsequent tax years. It will provide a benefit worth about $140 million over the 2015–16 to 2020–21 period.

Labour-Sponsored Venture Capital Corporations Tax Credit

Budget 2016 takes action to facilitate access to venture capital for small and medium-sized businesses and support saving by the middle class. Budget Implementation Act, 2016, No. 1 will restore the Labour-Sponsored Venture Capital Corporations (LSVCC) tax credit to 15 percent for share purchases of provincially registered LSVCCs for 2016 and subsequent tax years. The measure will provide federal tax relief of about $815 million over the 2015–16 to 2020–21 period.

PPP Canada

When well-planned infrastructure makes it easier for Canadians to get to work on time, bring their kids to soccer practice, or go out for a family dinner, the entire economy benefits. Investing in infrastructure creates good, well-paying jobs that can help the middle class grow and prosper today. Budget 2016 lays the groundwork for future growth by making immediate investments of $11.9 billion over five years, starting right away, in public transit, green infrastructure, and social infrastructure. Going forward, the Government will invest more than $120 billion in infrastructure over 10 years to better meet the needs of Canadians and position Canada’s economy for the future.

Passage of the bill will help ensure that Government institutions are aligned to best support infrastructure innovation by transferring responsibility for PPP Canada Inc. from the Minister of Finance to the Minister of Infrastructure and Communities.

Enhancements to Veterans Long-Term Disability Benefits

Veterans and their families have earned the deepest respect and gratitude from all Canadians. Budget 2016 invests to give back to those who have given so much in service to our country. It proposes to restore critical access to services for veterans, and ensures the long-term financial security of those who were severely injured—physically or mentally—in the line of duty.

The bill will amend the Canadian Forces Members and Veterans Re-establishment and Compensation Act to increase, both retroactively and going forward, the Disability Award and associated benefits such as the Death Benefit and to adjust the orientation and terminology of the Permanent Impairment Allowance, while also increasing the Earnings Loss Benefit to 90 percent.