I was going to highlight the points of the provincial budget like I did for the federal one earlier this week. Actually, there's not too much to complain about. I would have liked to have seen the health tax eliminated, but overall it is a very progressive document even if it is with the fall election in mind. For the record, I am not shilling for anyone -- I am calling this the way I see it personally.
I want to focus on two of the key areas that are closest to my personal struggle for a more just Canada -- dignity for children and for seniors. First, kids.
The really good news is that the clawback of the National Child Benefit is being abolished, although it is being phased out over four years -- conveniently, just in time for the 2011 election. For the average low income family, that means an extra $122 per month, per child. The new Ontario Child Benefit or OCB, which replaces the problematic Child Care Supplement for Working Families, is in my opinion very innovative. It will help more families because it will not be means tested but income tested and one will not have to put their kids in day care to qualify for it. When fully implemented, it will mean an extra $1100 per child per year for families with incomes under $20k, with a clawback rate of 8% above that.
I am concerned about how it is going to be paid out -- I think it should be topped up of the federal child benefits in the same way provincial supplements are added in most other provinces. The McGuinty government has chosen to integrate the OCB into the welfare system for most, and one can only presume cheques will be sent out for those who qualify but are not on social assistance. I wish they would follow the KISS formula and save on postage but mo' money's better than no money. In short, child benefits are being doubled and four times as many kids will benefit. Very good news indeed.
As well the new federal working income supplement will flow through without any clawbacks -- so in a sense, the principle of robbing Peter to pay Paul is finally out the window. Seeing someone get benefits from the feds only to have it stolen by the province defeated the purpose of income support which is to get people off welfare and onto work. The best social program always has been and always will be A JOB. After all, a working person pays taxes and it's those taxes that pay for health, education and welfare.
Now, about seniors.
One interesting thing the government is doing is they're easing up the rules about "locked in" retirement funds. Under the new rules, a retiree will be able to "unlock" a quarter of his or her slush fund and can start withdrawing the money as early as age 55. Many people are taking early retirement -- as my father did during the 1990s -- so it will certainly help them, but I do worry about people spending their life savings before they truly need it.
Other changes involve enhancements to the property tax credit and harmonizing "income splitting" for seniors with federal rules. The most significant change deals with property taxes. This issues goes way beyond seniors, of course, but for the 65+ crowd more than other groups, wildly fluctuating property values can often mean the difference between staying in one's own home or going into a long-term facility.
So the semi-private assessment board will now rate home values every four years instead of every year, and cities would be required to phase in increases based on assessment changes over the four year cycle. This will no doubt be a relief to a lot of homeowners, and it will help cities have more predictable budgets as they propose expenditures over the cycle and not just year to year.
What would I have done differently? Not too much -- other than implement the phase-out of the NCB clawback immediately, and figure out a way to better tax this province's vast natural resources, as the Western provinces have done with their royalty structures. Overall, not bad. Ontario's Finance Minister, Greg Sorbara, gets a B+.
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