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Chapter 4
Investing in Canadian Families and Their Communities

Highlights

Budget 2003 makes major investments to help Canadian families and communities, to improve opportunities for Aboriginal Canadians and to promote Canadian culture and values.

Supporting Canadian Families

This budget makes long-term investments in support of families with children and persons with disabilities, including:

  • a $965-million-per-year increase in the National Child Benefit supplement of the Canada Child Tax Benefit (CCTB) by 2007, to bring the maximum annual benefit for a first child provided through the CCTB to $3,243. This will bring the estimated annual support delivered through the CCTB to over $10 billion in 2007, an increase of over 100 per cent since 1996;
  • $935 million over the next five years to assist provinces and territories and First Nations in increasing access to quality child care and early learning opportunities, especially for low-income and single-parent families;
  • $50 million per year for a new Child Disability Benefit for low- and modest-income families that will provide up to $1,600 annually for a child qualifying for the disability tax credit;
  • $20 million per year to expand the list of eligible expenses for the medical expense tax credit; and
  • $80 million per year to improve tax assistance for persons with disabilities, drawing on a forthcoming evaluation of the disability tax credit and the advice of a technical advisory committee.

Supporting Communities

To help communities, this budget makes significant investments to increase the supply of affordable housing, address homelessness and improve the state of Canada’s infrastructure:

  • $320 million over the next five years to enhance existing affordable housing agreements with the provinces and territories, bringing the total federal investment to $1 billion by the end of 2007–08;
  • $256 million over the next two years to extend the Government’s housing renovation programs to help preserve the existing stock of affordable housing;
  • $270 million over the next two years to continue to fight homelessness; and
  • an additional $3 billion in infrastructure support over the next ten years, including $1 billion for municipal infrastructure.

Strengthening Aboriginal Communities

Along with the initiatives to address health and other concerns on reserve and to improve economic opportunities for Aboriginal Canadians described in Chapters 3 and 5, this budget makes strategic investments to strengthen Aboriginal communities, including:

  • $172.5 million over eleven years to support Aboriginal languages and culture, of which $18 million will be invested in the next two years;
  • $42 million over the next two years to renew and expand the First Nations Policing Program; and
  • $17 million over the next two years to work with partners to explore new ways to better meet the needs of Aboriginal people living in urban centres.

Promoting Canadian Culture and Values

The Government will invest in measures to strengthen and promote Canadian culture and values, including:

  • $150 million over two years for the Canadian Television Fund to help the production of quality Canadian programming;
  • $114.5 million in the next two years to launch a five-year action plan on official languages; and
  • a contribution program of $10 million a year to provide a financial incentive to the private sector to preserve historic places.

Introduction

There is a fundamental relationship between economic success and quality of life. Only a strong economy can provide the jobs and incomes required to sustain families and their communities. Equally, the benefits to the economy of strong families and safe communities are self-evident. Like universal health care, providing for the needs of Canada’s households and neighbourhoods enriches Canadians’ quality of life.

Strong families and communities also serve a vital role in building Canada’s economy. By being the foundation on which successful lives are built, they help ensure that all Canadians are prepared for and capable of contributing to the economy. Just as investments in innovation and productivity strengthen the economy, investments in key areas of social policy help ensure the opportunities of that economy are available to all.

Budget 2003 makes further investments to help build the society Canadians value. It enhances support for Canadian families with children and persons with disabilities. It helps communities create more affordable housing, fight homelessness and improve infrastructure. It enhances the economic and social opportunities for Aboriginal Canadians. And it strengthens and promotes Canadian culture and values. These measures increase and enhance opportunities for all Canadians—helping to build the strongest possible foundation for a truly successful economy.

Supporting Canadian Families

Families With Children

The Government of Canada has a long-standing commitment to supporting families and children. It has fostered economic growth and job creation, which are essential to reducing poverty and ensuring that families have the resources they need to care for their children. In addition, the Government has made significant investments in income and service supports for families in need, enhancing existing initiatives and introducing new measures in order to improve the chance that a Canadian child will grow up to be a healthy, contributing member of society. These investments include the Canada Child Tax Benefit (CCTB), the Early Childhood Development initiative, and the extension and improvement of the employment insurance parental benefit.

Budget 2003 builds on these initiatives. It proposes a long-term investment plan that increases significantly the National Child Benefit (NCB) supplement for low-income families. It introduces a new Child Disability Benefit for low- and modest-income families with disabled children. It invests in quality child care, a child-centred family law strategy, and new measures to protect children and other vulnerable persons. As described in Chapter 3, the Government will also introduce an employment insurance compassionate family care benefit to provide income support and job protection for those who take time off work to care for a gravely ill family member.

Increasing the National Child Benefit Supplement

The CCTB is the main federal instrument for the provision of financial assistance to families with children. Currently the CCTB provides annually over $8 billion in assistance to 3.2 million families, with annual benefits of up to $2,444 for the first child, $2,238 for the second child, and $2,240 for each additional child.

The CCTB has two components: the CCTB base benefit and the NCB supplement. The NCB supplement provides additional assistance beyond the CCTB base benefit to low-income families with children. The NCB supplement is the federal contribution to the NCB initiative, under which the federal, provincial and territorial governments are acting together to reduce child poverty while helping to overcome the "welfare wall" that discourages many parents on social assistance from taking a job because of a resulting loss in child-related benefits and services.

This budget proposes to increase the NCB supplement component of the CCTB for low-income families by an annual amount of $150 per child in July 2003, $185 in July 2005 and $185 in July 2006. With these increases, plus full indexation restored under the Five-Year Tax Reduction Plan, the maximum CCTB benefit is projected to reach $3,243 for the first child, $3,016 for the second child and $3,020 for each additional child, in 2007. This will bring the maximum benefit for the first child to $3,000 per year in today’s dollars. The NCB supplement increases in the budget will provide about $965 million annually in additional benefits to low-income families in 2007.

Table 4.1
Benefits Under the Canada Child Tax Benefit


Projected1

Benefit year

2002 2003 2004 2005 2006 2007

(dollars)

Maximum total
 CCTB benefit
First child 2,444 2,632 2,693 2,934 3,179 3,243
Second child 2,238 2,423 2,479 2,716 2,956 3,016
Third child and
 subsequent children
2,240 2,427 2,482 2,719 2,959 3,020
Additional benefit for
 children under 7 years
 of age
228 232 237 242 247 252

(millions of dollars)

Fiscal cost
Budget 2003 NCB
 supplement increase
270 310 640 950 965
Total CCTB cost 8,095 8,430 9,100 9,560 10,000 10,145

1 Projections based on an average indexation factor of about 2 per cent per year.

Chapter 4 - Enhancements of Federal Child Benefits

With the changes announced in this budget, assistance to families with children through the CCTB is projected to reach over $10 billion in 2007, an increase of over 100 per cent since 1996. Over this period, the maximum annual benefit for a first child under the CCTB will have more than doubled from $1,520 to $3,243.

Concurrently, the enrichments to the NCB supplement will have succeeded in enabling provinces to replace basic child benefits provided under social assistance for the vast majority of children in Canada, thus helping poor families to break out of the welfare trap and the cycle of poverty. The federal government will continue to work with provincial and territorial governments with the objective of ensuring that additional federal investments in the NCB supplement announced in the budget result in net benefits for low-income families with children.

The long-term investment plan set out in this budget represents significant additional income support for low-income families with children. Going forward, the federal government and the provinces will need to ensure that, as the welfare wall is overcome, low- and modest-income families with children who realize greater earnings—for example, by taking up better paying jobs—keep more of the extra money they earn. This will include examining the reduction or "clawback" rates for the CCTB as well as other elements of the tax and benefit structure that may affect incentives to work and earn income for low- and modest-income families.

How the NCB Supplement Reduces the Welfare Wall and Child Poverty

Traditionally, families that move from social assistance to work would lose a range of child-related income support and services tied to the welfare system. For many low-income families, the prospect of losing those benefits, compounded with the need to incur work-related expenses and to find affordable child care, would be a major barrier to seeking employment—taking a job could mean that the family would be financially worse off. This barrier is often referred to as the "welfare wall."

Chapter 4 - After-Tax Income: Welfare vs. Working Family With Two Children

Under the NCB initiative, the NCB supplement, paid to all low-income families with children, has replaced an increasing proportion of child-related basic income support provided under social assistance. Resulting provincial/territorial social assistance savings have been redirected to new or enhanced benefits and services for low-income families with children. Examples of provincial reinvestments include earned income supplements, child care subsidies and supplementary health coverage.

By protecting benefits and services for families with children when parents leave social assistance to enter and stay in the workforce, the NCB initiative has contributed significantly to reducing financial disincentives to leave social assistance, thereby increasing the rewards from work and reducing child poverty.

The most recent data available from Statistics Canada confirm the positive impact of a strong economy and enhanced child benefits and programs in helping to reduce child poverty in Canada:

  • between 1996 and 2000, the proportion of children in families with incomes below Statistics Canada’s after-tax low-income cut-offs decreased from 16.7 per cent to 12.5 per cent; and
  • the employment rate among low-income families rose by 4 percentage points.

Continued strong economic growth and job creation, together with the investments in children set out in this budget, will help achieve further significant reductions in the incidence and depth of child poverty in Canada.

Early Learning and Child Care Services

In September 2000, first ministers announced the Early Childhood Development Agreement, under which the Government of Canada is transferring $2.2 billion over five years to the provincial and territorial governments to improve and expand early childhood development programs in four key areas: healthy pregnancy, birth and infancy; parenting and family supports; early childhood development, learning and care; and community supports. The federal contribution will reach $500 million starting in 2003–04.

In October 2002, the federal government announced an additional investment of $320 million over five years to support and enhance the early childhood development of Aboriginal children, with a particular focus on First Nations on reserve. Total federal support will amount to $65 million in both 2003–04 and 2004–05.

The Government of Canada recognizes that quality early learning and child care programs and services play an important role in promoting the healthy development of young children. These programs also support the participation of parents in employment and training. That is why the federal government committed, in the September 2002 Speech from the Throne, to work with its partners to increase access to these important programs and services.

In recent months, the Government of Canada has been working with its provincial and territorial partners to develop a strategy to improve access to affordable, quality regulated early learning and child care services for young Canadian children and their parents. Pending the outcome of these discussions, the Government of Canada will provide $900 million over the next five years, including $100 million in the next two years, to provincial and territorial governments to:

  • substantially increase the number of child care and preschool spaces;
  • reduce the cost of child care and preschool services for low- and modest-income families; and
  • improve the quality of child care and preschool services.

By improving access to affordable, quality early learning and child care programs, the Government of Canada is helping to ensure the best possible start in life for Canadian children. At the same time, the Government is making it easier for their parents to work or pursue training.

To complement this support for provincial and territorial governments, this budget also provides an additional $35 million over five years to build on federal early learning and child care programs for First Nations children, primarily on reserves.

Canadians With Disabilities

The Government of Canada is committed to supporting full participation for persons with disabilities in Canadian society. To that end, this budget makes strategic investments both directly and in partnership with provinces, territories, and the private and voluntary sectors.

The Child Disability Benefit

Caring for children with severe disabilities imposes a heavy burden on families, especially low- and modest-income families. It is important that these children realize their potential.

In recognition of this, the budget introduces a new $1,600 Child Disability Benefit, effective July 2003. Eligibility for this income-tested benefit will be based on the same eligibility criterias used for the disability tax credit (DTC). This will target the benefit to children with a severe and prolonged mental or physical impairment. The full $1,600 per-child benefit will be provided to all families currently receiving the NCB supplement, that is families with incomes of less than $33,487 for 2003, who have a disabled child who qualifies for the DTC. Beyond that income level, the Child Disability Benefit will be reduced based on family income at the same rates as the NCB supplement.

The Child Disability Benefit will be paid as a supplement to the CCTB. Together with other investments in the CCTB proposed in this budget, this measure will bring maximum total support under the CCTB to $4,232 in July 2003, growing to $4,982 in July 2007 for a child age 7 or over with a disability. Families will continue to be able to claim the DTC and the DTC supplement for children.

The Government will work with provinces and territories to ensure that families receiving income support from the province or territory will realize the full benefit of the new Child Disability Benefit.

Federal Assistance for Children With Disabilities

In 1996 a one-earner family with one child with a severe disability and an income of $30,000 obtained a tax reduction of $720 under the DTC. In 2007, taking into account measures in this budget and indexation, this same family will receive $1,739 from the Child Disability Benefit, and obtain a tax reduction of $1,728 under the DTC and DTC supplement for children, for a total of $3,467. For this family, federal assistance for children with disabilities will have increased almost fivefold between 1996 and 2007. This family will also receive assistance of $2,152 in 2007 through the base CCTB and NCB supplement.

Chapter 4 - Federal Assistance for Families With Children With Disabilities

The Canada Customs and Revenue Agency will start paying the Child Disability Benefit in March 2004, with retroactive effect to July 2003.

This new measure will increase financial assistance to families with disabled children by $50 million annually.

Tax Measures for Persons With Disabilities

The Government in recent years has significantly enhanced the tax measures that recognize that individuals with disabilities—and those who care for them—have a reduced ability to pay tax and face greater barriers to labour force participation.

The Government took action to enhance tax measures for persons with disabilities even before the budget was balanced. The table below summarizes actions taken in recent budgets in this regard. Many of the recent changes have been made in response to representations from Canadians, parliamentarians and groups representing persons with disabilities.

Table 4.2
Some Recent Enhancements to Tax Measures
for Persons With Disabilities


  1995 2003

 

(dollars)

Increased DTC (credit amount) 4,233 6,279
Increased child care expense deduction limit
 in respect of DTCeligible children
 5,000 10,000
Introduced and increased DTC supplement
 for DTC eligible children (credit amount)
01  3,663
Introduced and increased caregiver credit (credit amount) 02 3,663
Increased infirm dependant credit (credit amount) 1,583 3,663

1 The credit amount for 2000, the year of introduction of the DTC supplement for children with disabilities, was $2,941.
2 The credit amount for 1998, the year of introduction of the caregiver credit, was $2,353.

The following table presents a summary of key federal tax measures for persons with a disability.

Table 4.3
Tax Measures for Persons With Disabilities


   Annual amount
2002 (estimates)

 

(millions of dollars)

Recognizing reduced ability to pay tax  
Disability tax credit (DTC) 4001
Medical expense tax credit 580
Caregiver credit 48
Infirm dependant credit 10
Reducing barriers to labour force participation  
Medical expense supplement for earners 52
Other tax measures2 small
Total 1,090

1 Includes DTC supplement for children.
2 Includes attendant care expense deduction and the child care expense deduction for DTC eligible children.

This budget adds to—and builds on—tax measures introduced in previous budgets to provide support to persons with disabilities.

RRSP/RRIF Rollovers for an Infirm Child

One of the most important concerns for parents caring for an infirm child is to ensure that the child will be properly provided for in the event of the parent’s death. A financially dependent infirm child is eligible to receive a tax-free rollover of a deceased parent’s registered retirement savings plan (RRSP) or registered retirement income fund (RRIF) proceeds. In recognition of the special need for the ongoing care of financially dependent infirm children and to provide supporting parents with greater certainty in their estate planning, this budget proposes to increase the level of income used to determine the financial dependence of an infirm child for the purpose of these rules from $7,634 to $13,814, effective in 2003. As a result, more infirm children or grandchildren will be able to receive a tax-free rollover of a deceased parent’s or grandparent’s RRSP or RRIF proceeds.

This measure is estimated to cost $10 million annually.

Expanding the List of Eligible Expenses for the Medical Expense Tax Credit

The medical expense tax credit recognizes the effect of above-average specific medical and disability-related expenses on an individual’s ability to pay income tax. The list of expenses eligible for this credit is regularly reviewed and expanded in light of new technologies and other disability-specific or medically related developments. In order to better recognize specific disability-related costs, this budget proposes to expand the list of expenses eligible for the medical expense tax credit to include:

  • the cost of real-time captioning and other similar services used by persons with an impairment; and
  • the incremental cost of gluten-free food products for individuals with celiac disease who require a gluten-free diet.

These changes will be effective with the 2003 taxation year and are estimated to cost $20 million annually.

Ensuring the Effectiveness of the Disability Tax Credit

Through the DTC, the federal tax system gives recognition to the effect of a severe and prolonged mental or physical impairment on an individual’s ability to pay tax. The DTC provides $400 million annually to about 450,000 Canadians with a severe disability or to those who care for them. The Government has listened to the community of persons with disabilities, medical professionals and parliamentarians and determined that more needs to be done to ensure that the DTC effectively meets its intended purpose.

The Disability Tax Credit

The DTC contributes to the Government’s broad objective of achieving fairness in taxation. Fairness requires that individuals in similar situations with similar incomes pay similar amounts of tax. Because individuals with severe and prolonged mental or physical impairments incur disability-related expenses that are not incurred by others, their ability to pay tax is reduced.

The DTC recognizes that these expenses may be non-discretionary. For example, individuals with severe mobility impairments may have special transportation needs that result in higher costs. The DTC does not require claimants to itemize the disability-related expenses they incur. Instead, eligible claimants are provided with the equivalent of a general expense claim of $6,279. This reduces their federal tax by up to $1,005, or 16 per cent of $6,279, in 2003. Additionally, the DTC supplement for children provides up to $586 in further tax relief for families caring for a severely disabled child. Provinces and territories provide similar credits.

As stated in the Government’s August 2002 response to the seventh report of the Standing Committee on Human Resources Development and the Status of Persons with Disabilities, the Government will be conducting an evaluation of the DTC as data from the 2001 Participation and Activity Limitation Survey become available. The objective of the evaluation will be to determine whether the DTC is achieving its policy purpose, which is to recognize that individuals with severe and prolonged mental or physical impairments often face additional non-discretionary expenses for basic daily living, which reduce their ability to pay tax.

In addition, the Government announces the establishment of a technical advisory committee on tax measures for persons with disabilities. This committee will advise the Ministers of Finance and National Revenue. It will comprise members of organizations representing persons with disabilities, medical practitioners, and private sector tax experts. Over a period of 18 months, the committee will assist the Government in addressing issues identified by the community of persons with disabilities, in a manner that is consistent with the objective of the DTC and that takes into account available fiscal resources. Issues that could be examined by the Committee include, for example:

  • eligibility for the DTC, particularly for persons who suffer from episodic and mental conditions;
  • the list of activities of daily living used to determine eligibility for the credit; and
  • the identification of professionals allowed to certify eligibility.

This budget sets aside $25 million in 2003–04 and $80 million per year starting in 2004–05 to improve assistance for persons with disabilities, drawing on the evaluation of the DTC and the advice of the technical advisory committee.

The budget also clarifies the eligibility criteria for the DTC to ensure that the DTC continues to be provided to those most in need. Additional information is provided in Annex 9.

With the changes announced in this budget, tax relief for persons with disabilities or medical expenses and those who care for them will have, since 1996, more than doubled, from $600 million to about $1.3 billion per year.

Employability Assistance for Persons With Disabilities

The Employability Assistance for Persons with Disabilities (EAPD) program was launched in 1998–99. Approximately 200,000 persons per year participate in EAPD funded projects. The program is delivered through joint federal-provincial funding agreements which expire this year. Because this program represents an important part of the Government’s commitment to the participation of disabled persons in the workforce, Budget 2003 renews the federal government’s existing funding commitment of $193 million per year, starting in 2003–04. The Minister of Human Resources Development will be negotiating renewed agreements to support provincial programming and services for the disabled.

Child and Family Law Strategy

On December 10, 2002, the Minister of Justice announced the Child-centred Family Justice Strategy to create a family justice system that helps parents focus on the needs of their children after separation and divorce. Budget 2003 commits $53 million over the next two years to improve the family justice system, an investment that will generate important benefits for children, their families and Canadian society as a whole.

The Government of Canada has also introduced amendments to the Criminal Code to better protect children from abuse and exploitation. These amendments will strengthen the child pornography provisions by broadening the definition of child pornography; create a new category of sexually exploitative relationship; increase maximum sentences for child-related offences; and facilitate the provision of testimony by child victims and witnesses in court.

Table 4.4
Supporting Canadian Families


   2003-2004 2004-2005

(millions of dollars)

Families with children    
National Child Benefit supplement 200 300
Early learning and child care 25 75
First Nations child care   6
Canadians with disabilities    
Child Disability Benefit 40 50
Enhanced tax assistance for persons 
  with disabilities
   
  RRSP rollovers to an infirm child 10 10
  Expanding the list of eligible expenses
   for the medical expense tax credit
 20 20
  Following through on evaluation of 
   DTC and advice of the technical 
   advisory committee
25 80
Employability Assistance for 
  Persons with Disabilities
193 193
Child and family law strategy 27 26
Total 540 760

Supporting Communities

The Speech from the Throne recognized that healthy communities and competitive cities are vital to Canadians’ individual and collective well-being. It is therefore critical that all orders of government participate in building and strengthening culturally diverse communities, with robust and vital local economies that are well managed, with safe neighbourhoods, modern infrastructure and dynamic labour forces.

Budget 2003 builds on past actions with a number of strategic investments to reduce homelessness and for affordable housing and infrastructure. These investments will help to promote the social cohesion and economic sustainability of Canada’s communities. They are complemented by the initiatives proposed in this budget related to health care, innovation and skills, and the environment which, taken together, will help to ensure that Canada’s cities and communities continue to provide the strong, safe and rich environments in which Canadians can feel proud to live, work and play.

Affordable Housing and Support for the Homeless

Affordable Housing Initiative

Despite a strong economy, there remain problems of affordability and supply of rental housing, particularly in major urban centres. As a result, many Canadians, especially the working poor, face difficulty in finding affordable rental housing. To help address this problem, the Government announced in 2001 the Affordable Housing Initiative, investing $680 million over five years. Under this initiative, the Canada Mortgage and Housing Corporation (CMHC), in partnership with provincial and territorial governments, provides funding to private and non-profit developers to help stimulate the construction of affordable rental housing. The funding structure is based on equal federal and provincial contributions. Nearly all provinces and territories have now signed bilateral cost-sharing agreements and progress is starting to be made on the construction of new affordable rental housing.

The Government recognizes, however, that the need remains great and that more must be done. As a result, starting in 2003–04, the Government is prepared to invest an additional $320 million over five years, including $80 million in the next two years, through the existing affordable housing agreements with provinces and territories, to help increase the supply of such rental housing available to Canadians. This will bring the total federal investment in the Affordable Housing Initiative to $1 billion by the end of 2007–08.

Residential Rehabilitation Assistance Program

Building new units of affordable housing is only one side of the story. It is equally important to ensure that existing affordable housing units do not fall into disrepair, effectively reducing the overall supply. CMHC’s Residential Rehabilitation Assistance Program and related programs support the renovation and renewal of the existing stock of housing and help low-income persons with critical housing repair needs. These programs have a significant impact on the condition of the low-income housing stock, and contribute to neighbourhood improvement. Beneficiaries of the renovation programs include homeowners, renters, rooming-house occupants, disabled persons, households in rural and remote communities, on-reserve households, elderly people and victims of family violence.

In order to help preserve the existing stock of affordable housing, this budget extends for three years the Government’s housing renovation programs, which would otherwise expire on March 31, 2003. This extension will require an investment of $128 million a year for a total of $384 million over three years.

Supporting Communities Partnership Initiative

In response to the growing number of homeless, particularly in Canada’s urban centres, the Government of Canada launched, in 1999, the three-year National Homelessness Initiative. A key element of this was the Supporting Communities Partnership Initiative, which provides funding for local community groups to offer supportive services and facilities for the homeless. Participating communities have seen real benefits in terms of new and improved facilities and services for homeless people. Budget 2003 provides for a three-year extension of the Supporting Communities Partnership Initiative at $135 million a year in order to help communities sustain their efforts to address homelessness.

The Surplus Federal Real Property for Homelessness Initiative will also be extended to help facilitate the transfer of surplus federal properties to communities as a method of avoiding the often-prohibitive costs of purchasing the land and buildings that are crucial to many projects for the homeless.

Infrastructure

Modern infrastructure is important to the economic and social well-being of Canadians, who depend on it for basic needs such as clean water and transportation. At the same time, Canada’s communities face growing infrastructure investment challenges. Large urban centres are working to keep pace with the demands resulting from population growth and increased economic activity. At the same time, requirements are just as significant in smaller communities and rural areas.

Recent budgets announced $5.25 billion in federal support for infrastructure, including $2.05 billion for the Infrastructure Canada Program and $2 billion for the Canada Strategic Infrastructure Fund. Programs specifically for highway and border infrastructure were also put in place at a combined cost of $1.2 billion. These initiatives are now resulting in improvements to Canada’s competitiveness and the prosperity of our communities.

This budget builds on these recent initiatives and provides an additional $3 billion in infrastructure support over the next 10 years, including $100 million in 2003–04 and $150 million in 2004–05. A total of $2 billion will be used to double the funding available under the Canada Strategic Infrastructure Fund. This will allow the Fund to provide additional assistance to large-scale projects, including those located in Canada’s major urban centres.

The remaining $1 billion will finance new municipal infrastructure investments over the next 10 years that will focus on projects that are typically smaller in scale. The long-term nature of this investment will allow municipalities across Canada to better plan and implement their infrastructure improvements.

Climate-change-related projects will be eligible and given particular consideration under these two initiatives (details on climate change measures announced in this budget are included in Chapter 5).

With contributions from other sources such as provincial, territorial and local governments and the private sector, the $3 billion in new federal funding for infrastructure should stimulate at least $7 billion in new infrastructure investment across Canada.

Integrated Proceeds of Crime

The federal government is committed to working with its many partners, nationally and internationally, to ensure that Canadians feel safe in their communities. Proceeds of crime investigations and prosecutions are key tools in the federal government’s overall response to combat organized crime and terrorism-funding activities. By using its integrated, multi-agency approach, the Integrated Proceeds of Crime initiative is an effective strategy for combatting organized crime and terrorism.

This budget provides $46.6 million over two years to continue the Integrated Proceeds of Crime initiative.

Table 4.5
Supporting Communities


   2003-2004 2004-2005

(millions of dollars)

Affordable housing and support
  for the homeless
   
Affordable Housing Initiative 30 50
Residential Rehabilitation Assistance Program 128 128
Supporting Communities Partnership Initiative 135 135
Infrastructure    
Strategic infrastructure   50
Municipal infrastructure 100 100
Integrated Proceeds of Crime 23.3 23.3
Total 416.3 486.3

Strengthening Aboriginal Communities

The federal government currently invests more than $7.5 billion each year to support Aboriginal Canadians. This funding provides basic services for First Nations on reserves such as education, health care and infrastructure. It also helps to ensure that Aboriginal individuals and communities have the tools they need to improve their quality of life and thus be in a position to take advantage of economic opportunities.

Aboriginal Canadians have used that support to achieve better health, education and economic outcomes. But serious disparities in comparison to non-Aboriginal Canadians remain. The Speech from the Throne reiterated the need to close the gap in life chances between Aboriginal and non-Aboriginal people. To address these challenges, the Government has been examining ways to improve and better coordinate Aboriginal programming.

Building on that work, this budget announces additional investments to enhance the delivery of health services on reserve (see Chapter 3), to address water safety concerns on reserve, and to ensure the place of Aboriginal individuals in a highly productive, sustainable economy (see Chapter 5). At the same time, this budget proposes to make several investments to strengthen Aboriginal communities and to extend some existing Aboriginal programs that have demonstrated their effectiveness.

On reserves, the federal government will continue to work in partnership with First Nations to invest in practical measures to improve their socio-economic status. The federal government will continue to work with provincial and territorial governments to meet the unique needs of Aboriginal Canadians in the North, and to improve program and service delivery to Aboriginal individuals, families and children across the country.

First Nations Policing

The First Nations Policing Program has been successful and effective at improving public safety in First Nations communities. This budget provides additional funding of $42 million over the next two years to renew current agreements and expand the number of communities that can participate in this program.

Languages and Culture

The Government of Canada is committed to assisting Aboriginal Canadians in the preservation, revitalization and promotion of the languages and culture that will play an important role in the future of their communities. To help foster this unique element of Canadian culture, the Minister of Canadian Heritage announced, in December 2002, funding of $172.5 million over 11 years, $18 million of which is to be invested over the next 2 years, to support the creation and operation of a new Aboriginal Languages and Cultures Centre under the stewardship of Aboriginal peoples. Budget 2003 confirms that investment.

Federal Interlocutor for Métis and Non-Status Indians

The Office of the Federal Interlocutor for Métis and Non-Status Indians has been instrumental in building a practical relationship with Métis and non-status Indian groups across Canada. To enable the Interlocutor to continue this important work, this budget provides $6 million over the next two years.

Urban Aboriginal Strategy

In 1998 the Government recognized the unique challenges faced by Aboriginal Canadians living in urban centres, including the disproportionately high levels of poverty they face. Since then it has made progress in working with other governments and in coordinating programs to reach those in need. This budget provides $17 million over two years for cost-shared pilot projects that will explore new ways to better meet the needs of urban Aboriginal people in select cities.

Table 4.6
Strengthening Aboriginal Communities


   2003-2004 2004-2005

(millions of dollars)
First Nations policing 18 24
Language and culture 8 10
Federal Interlocutor for Métis and 
  Non-Status Indians
3 3
Urban aboriginal strategy 9 8
Total 38 45

Promoting Canadian Culture and Values

To promote the strength of Canada’s identity, the Government will continue to provide Canadians with the means to know more about themselves and to share their identity with each other and with the world.

Cultural and Heritage Programs

Historic Places

The Government is committed to the development of initiatives in support of the restoration and preservation of Canada’s built heritage. To this end, the Department of Canadian Heritage has been developing a national register, conservation standards and a certification process in respect of restoration expenditures. In order to provide financial incentives to the private sector to preserve heritage properties, the Government of Canada will create a three-year contribution program of $10 million per year to compensate businesses for a portion of the costs incurred in restoring heritage buildings.

Canadian Television Fund

The Canadian Television Fund was established in 1996 to spur the production of quality, distinctly Canadian television programming. The Fund—supported by the broadcasting distribution industry, Telefilm Canada and the Department of Canadian Heritage—has met with considerable success in providing new quality Canadian programming.

The successful expansion of the broadcasting distribution industry over the last few years has resulted in a significant increase in the funds available from this source. This budget provides $75 million a year for two years to allow the Department of Canadian Heritage to continue its support for the Fund.

Katimavik

The Government of Canada is committed to fostering the personal, social and professional development of Canada’s youth, promoting community service, and encouraging a better understanding of Canada. The Katimavik program offers young Canadian men and women aged 17 to 21 an opportunity to acquire valuable personal and professional skills through development programs in leadership, exposure to a second language, cultural discovery, environmental protection and adoption of a healthy lifestyle. This budget invests $17 million over the next two years to enable many more young Canadians to share in the Katimavik experience.

Official Languages

Linguistic duality is at the heart of Canada’s collective identity. Knowledge of another official language is a matter of both cultural and economic enrichment. It helps to open the door to a different vision of the world and improve access to global markets and the opportunities they offer. Over the last quarter century, the advancements that Canada has made in the teaching, promotion and use of the second language is nothing less than remarkable. Today 2.6 million children—half of those attending primary or secondary schools in Canada—are learning English or French as a second language. Some 324,000 are in French immersion classes. Currently 24 per cent of young Canadian high school graduates know both official languages. This represents the most bilingual generation in Canada’s history.

With this budget, the Government will invest in a five-year action plan to renew its support to official languages. As mentioned in the Speech from the Throne, the plan will first focus on minority language and second language education with the intent of doubling, within 10 years, the number of high school graduates with a working knowledge of both official languages. The action plan will also support the development of minority English- and French-speaking communities, expand access to services in their language in areas such as health, and enhance the use of Canada’s two official languages in the public service, both in the workplace and while providing services to Canadians.

In addition to the $25 million over the next two years provided for expanded access to health care services for minority language communities (see Chapter 3), this budget provides $114.5 million over the next two years for the action plan. This includes:

  • $60.5 million to improve the quality of minority and second language education, and provide young Canadians with opportunities to develop their grasp of official languages.
  • $54 million to improve the services available to official language minorities, support their economic development and implement a government-wide accountability framework. The action plan will:
    • deliver on legal obligations for official languages and other activities promoting linguistic rights;
    • help official language minority communities;
    • attract and retain immigrants in minority communities;
    • continue to better connect French-speaking individuals in minority communities through various initiatives; and
    • help coordinate and promote the development of language industries.

Other Initiatives

Legal Aid

The right to a fair trial is a cornerstone of Canada’s justice system. The Government committed in the Speech from the Throne to ensure that individuals facing serious criminal charges before the courts are provided with adequate legal assistance. The provision of criminal legal aid is an area of long-standing and successful federal, provincial and territorial collaboration. The federal government contributes financially to criminal legal aid services through contribution agreements with the provinces and territories.

Over the last few years, provincial and territorial governments have experienced significant cost increases for legal aid. Budget 2003 is therefore increasing funding for criminal legal aid by $89 million over the next two years, of which $83 million will further assist the provinces and territories.

A New Citizenship Act

The Minister of Citizenship and Immigration tabled a new citizenship bill in the House of Commons on October 31, 2002. The proposed changes to the Citizenship Act will contribute to a more inclusive Canada, foster a sense of belonging and attachment to the country, and reassert and celebrate the values, rights and responsibilities of Canadian citizenship. The new legislation will streamline the processing of high volumes of applications as well as establish fair and objective criteria for the granting of Canadian citizenship. This budget commits $20.6 million over the next two years to implement the proposed changes to the Citizenship Act.

Amateur Sport

Participation in sport not only contributes to the well-being of Canadian citizens, but it also enhances national pride. Sport participation is for everyone—from the elite athletes to Canadians from all walks of life. Recognizing this, the federal government currently invests some $75 million annually in a range of sport activities.

In addition to the investment of $45 million over five years that is part of the health package to promote sport participation by all generations of Canadians, this budget will invest $10 million in the next two years for additional support to Canada’s elite athletes in the event that the 2010 Vancouver Winter Olympic bid is successful.

These investments demonstrate the Government of Canada’s continued commitment to amateur sport and to Olympic success.

Table 4.7
Promoting Canadian Culture and Values


   2003-2004 2004-2005

(millions of dollars)
Cultural and heritage programs    
Historic places 10 10
Canadian Television Fund 75 75
Katimavik 5 12
Official languages 37.5 77
Other initiatives    
Legal aid 44.5 44.5
New Citizenship Act 10.6 10
Amateur sport 5 5
Total 187.6 233.5

Table 4.8
Investing in Canadian Families and Their Communities


2003-2004 2004-2005

(millions of dollars)
Supporting Canadian families
Families with children
  National Child Benefit supplement 200 300
  Early learning and child care 5 75
  First Nations child care 6
Canadians with disabilities
  Child Disability Benefit 40 50
  Enhanced tax assistance for persons 
   with disabilities
    RRSP rollovers to an infirm child 10 10
    Expanding the list of eligible expenses 
    for the medical expense tax credit
20 20
    Following through on evaluation of 
    DTC and advice of the technical 
    advisory committee
25 80
  Employability Assistance for Persons
   with Disabilities
193 193
Child and family law strategy 27 26
Total 540 760
Supporting communities
Affordable housing and support 
  for the homeless
  Affordable Housing Initiative 30 50
  Residential Rehabilitation Assistance Program 128 128
  Supporting Communities Partnership Initiative 135 135
Infrastructure
  Strategic infrastructure 50
  Municipal infrastructure 100 100
Integrated Proceeds of Crime 23.3 23.3
Total 416.3 486.3
Strengthening Aboriginal communities
First Nations policing 18 24
Language and culture 8 10
Federal Interlocutor for Métis and
 Non-Status Indians
3 3
Urban Aboriginal strategy 9 8
Total 38 45
Promoting Canadian culture and values
Cultural and heritage programs
  Historic places 10 10
  Canadian Television Fund 75 75
  Katimavik 5 12
Official languages 37.5 77
Other initiatives
  Legal aid 44.5 44.5
  New Citizenship Act 10.6 10
  Amateur sport 5 5
Total 187.6 233.5
Total 1,181.9 1,524.8

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Last Updated: 2003-02-18

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