Archived - The National Child Benefit: Questions and Answers

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Questions and Answers

1. What is the National Child Benefit (NCB)?

The National Child Benefit is a joint initiative of the Government of Canada and provincial and territorial governments.1 Goals of the initiative are to:

  • help prevent and reduce the depth of child poverty;
  • promote attachment to the work force; and
  • reduce overlap and duplication between Canadian and provincial/territorial programs.

The National Child Benefit will begin to remove child benefits from welfare, assist parents with the cost of raising children, and make it easier for low income parents to support their families through employment without resorting to welfare.

2. How will the National Child Benefit work?

In July 1998, the Government of Canada will introduce the Canada Child Tax Benefit which will contain a new benefit called the National Child Benefit Supplement. This benefit will eventually replace current benefits for children in provincial and territorial social assistance programs. With the new supplement, the maximum Canada Child Tax Benefit is being increased to $1,625 per year for the first child and $1,425 per year for each additional child. Some low income families (those who received the maximum Working Income Supplement in 1997/98) will have seen this increase beginning in July 1997 when the WIS was enhanced as a transitional step towards establishing the NCB.

As Government of Canada funding for children’s income support increases, provinces and territories have agreed that savings realized will be reinvested in complementary programs targeted for improving work incentives, benefits and services for low income families with children.

3. Who will the National Child Benefit help?

The National Child Benefit will assist children in low income families. This means as families leave social assistance for work, they will continue to receive financial assistance to meet the needs of their children and to assist with the child-related costs of going to work. This is an important step in helping families to participate in the work force and will help keep them independent of social assistance. Overall income support to families on social assistance will remain at least the same. Families on social assistance will benefit from many provincial National Child Benefit programs and services.

The Government of Canada is committed to ensuring that First Nations children living on reserve benefit like other Canadian children from the National Child Benefit.

4. How much are governments investing in the National Child Benefit?

The Government of Canada committed $850 million to its participation in the National Child Benefit for the program year beginning in July 1998. This funding will be used to enrich the Canada Child Tax Benefit.

As the Canadian Government benefit increases, provinces and territories will reinvest savings in complementary programs, benefits and services targeted at low income families with children. The value of the 1998/99 provincial/territorial reinvestment from social assistance/income support savings is reflected in the Update on Reinvestments under the National Child Benefit dated June 15, 1998. Details of these initiatives are included in the reinvestment summary which is attached. Also reflected in that material is additional provincial and territorial spending on benefits and services that meet the NCB objectives.

In its last Budget, the Government of Canada announced a further increase in the Canada Child Tax Benefit of $850 million over the next two years as part of the National Child Benefit, for a total of $1.7 billion. The Government of Canada and provincial and territorial governments will work in partnership over the coming years to develop a plan for this contribution and associated provincial/territorial reinvestments in benefits and services for low income families with children. Some provinces and territories have also contributed or are planning to contribute additional funds towards the National Child Benefit initiative.

5. How will the National Child Benefit help families living in poverty?

A major focus of the National Child Benefit is to help prevent and reduce the depth of child poverty. The National Child Benefit will provide the same amount of income support to all children in low income families whether they are working or on social assistance. This means that as they leave social assistance for work, they will continue to receive financial support for their children. This will help families stay in the workforce and reduce the need for social assistance.

6. How will the National Child Benefit help social assistance families?

With the introduction of the National Child Benefit, families on social assistance will continue to receive at least the same total amount of money. Provinces and territories have agreed that as the Canada Child Tax Benefit support for children increases, they will reinvest savings in complementary programs, benefits and services targeted for low income families with children.

By providing children's income support benefits outside the welfare system, families will more easily be able to leave social assistance for work and be able to meet their children’s needs without having to turn to welfare.

7. Will families who leave provincial/territorial social assistance be worse off than before because of a loss of the extended benefits that they would have received when on social assistance?

Low income families with children who leave provincial/territorial social assistance systems will keep their full Canada Child Tax Benefit including the National Child Benefit Supplement increase. This will mean more monthly income for those families. Under the National Child Benefit initiative, many jurisdictions will introduce extended drug/dental benefit programs, child care assistance, and working income supplements to help low income working families who have recently exited from social assistance.

The aim of the National Child Benefit is to provide the Canada Child Tax Benefit to all low income families, and over time to displace and eventually to fully replace welfare benefits for children. It is intended to provide a common child income benefit to all low income families regardless of their source(s) of income. Provincial reinvestment will focus on reducing child poverty and increasing the incentives for low income families with children to move from welfare to work and to remain in the workforce.

8. What guidelines exist regarding provincial reinvestment strategies?

Provinces and territories share a commitment to the success of the National Child Benefit and to reinvesting social assistance funds into benefits and services for children in low income families. Social Services Ministers are committed to openness, transparency and full accountability for all provincial/territorial savings. A national reinvestment framework has been developed indicating this commitment.

Reinvestment programs will meet the objectives of the National Child Benefit and provinces and territories have the flexibility to design or enhance programs for children that reflect each jurisdiction's special needs and priorities.

The result will be new or enhanced programs for low income families with children and more incentives for families to move from social assistance to work.

9. How are you going to measure the results of the National Child Benefit?

At the March 12th meeting of Social Services Ministers, a Governance and Accountability Framework was released that commits all governments to the objectives, principles and partnership surrounding the National Child Benefit including public reporting on how well the initiative is meeting its objectives.

Measuring changes in the depth of poverty is an important aspect of assessing how well the National Child Benefit is working. As part of the review of possible National Child Benefit performance measures, the governments of Canada and the provinces and territories intend to seek input from academics, non-governmental organizations and Canadians on poverty measures.

By the end of the year, the first National Child Benefit Accountability and Performance Report will be released. This report will outline the results of the National Child Benefit to date and detail the performance measures that will help governments to remain publicly accountable for the success of the National Child Benefit.

10. How does the National Child Benefit fit with the plan to create a National Children’s Agenda?

The desire for a National Children’s Agenda has grown out of the recognition that a more comprehensive approach is required to address the needs of Canada’s children.

One of the many issues a children’s agenda would have to consider is the problem of income security. The National Child Benefit will help to address that issue and is an important part of a broader strategy on children.

11. Will First Nations Children on Reserve benefit from the National Child Benefit?

Yes. Governments are committed to working with First Nations to ensure that First Nations children living on reserve will benefit, like other Canadian children, from the National Child Benefit.

On-reserve reinvestment plans will be tailored to the needs on First Nations reserves. In some provinces and territories, First Nations and provincial or territorial reinvestment plans will be the same, but in others, First Nations will develop their own unique reinvestment initiatives. Indian and Northern Affairs Canada is actively working with First Nations to develop reinvestment strategies.


1Quebec, while agreeing on the basic principles of the National Child Benefit, has not taken part in the development of this initiative because it wishes to assume control of income support for the children of Quebec.

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