In the 1960s, my mother's monthly family allowance cheque paid for a week's groceries.
In 2011, the median Canadian two-parent family had an income of just over $90,000. At that level of net income, a family with two children receives Canada Child Tax Benefit worth $87 per month. That doesn't come close to paying for a week's groceries.
The Harper government has already gone some way to providing greater tax recognition for the costs of children through the introduction of the Universal Child Care Benefit and the introduction of a non-refundable child amount credit. Both of these are good policies.
Yet they are overlaid upon a CCTB system that contains fundamental flaws.
First, because the CCTB is clawed back as a family's net income increases, it does not provide generous support for a typical two-parent family in Canada's major cities. I think of my niece and her husband, who are about to give birth to their first child. Yes, their household income is reasonably high - but they has to pay for the cost of housing in Vancouver. It will be really tough for them to manage. Financial support that paid for a week's groceries would make a real difference to them.
Second, CCTB clawbacks increase the marginal tax rates faced by parents of children - and high marginal tax rates have efficiency costs.
Third, the CCTB is based on net family income. The income calculation is the same for two-parent and one-parent families. This can create a non-trivial marriage penalty for low income individuals. For example, if an Ontario single parent with net income of $30,000 marries someone at the same income level, she would loose close to $500 per month in CCTB (calculated using the CCTB calculator here).
Income splitting would be one way to deliver increased benefits to families. But it does not recognize the amazing diversity of ways that Canadian families come together to raise their children - the grandparents who spend their retirements pushing strollers, the parents who juggle shifts so that someone is always home for the kids, the single parents and blended families and other complexities of modern life.
The best way to support families with children is to give money to families with children.
I would advocate doing so through a new program, that combined the best features of the CCTB and UCCB, and supported Canadian families.