Cost of Canada Child Benefit program jumped sharply during post-COVID inflation, PBO says

Canada Child Benefit costs jumped sharply with post-COVID inflation, PBO says CRAIG LORD OTTAWA THE CANADIAN PRESS PUBLISHED YESTERDAY Open this photo in gallery: PBO Annette Ryan prepares to appear at a standing committee in Ottawa in June. The cost of the Canada Child Benefit program rose to $29.2-billion in 2024-25, a PBO report finds. JUSTIN TANG/THE CANADIAN PRESS COMMENTS SHARE SAVE FOR LATER Listen to this article Learn more about audio Log in or create a free account to listen to this article. Ottawa’s fiscal watchdog says a surge in inflation a few years back drove a substantial jump in the cost of delivering the Canada Child Benefit after the pandemic. The new report from parliamentary budget officer Annette Ryan also suggests most of those benefiting from the increased payout were not among Canada’s lowest-income households. The Office of the Parliamentary Budget Officer said in a report Thursday that the cost of delivering the federal payment to families increased $4.2-billion between the 2022-23 and 2024-25 benefit years. That increase – which amounts to more than 16 per cent – brought the total payout for the Canada Child Benefit to $29.2-billion in 2024-25. The budget office said the increase over those two years outpaced the higher costs during the COVID-19 pandemic, when the benefit was given temporary boosts to help families cope with economic uncertainty. The average annual Canada Child Benefit payment increased to $7,700 over this period, up from $6,700 previously. Like most federal support programs, the Canada Child Benefit is indexed annually to inflation. Statistics Canada reported that inflation hit a nearly 40-year high of 8.1 per cent in June 2022. The PBO said more than two-thirds of the increase observed over the two-year period tracked in the report was part of this catch-up to inflation. The child benefit is income-tested and targeted at low- and medium-income households with children, so costs can also rise when families fall behind economically. The PBO report estimates that a quarter of the recent hike in benefits was tied to eligible households’ incomes not keeping up with inflation during the period. The budget office also estimates that households with an annual income of $50,000 or more accounted for 70 per cent of Canada Child Benefit recipients in 2024-25, and received a total payout of $14.7-billion that year. Households making less than $50,000 per year accounted for 40 per cent of the increased…