Originally published by Investment Executive on April 25th, 2011. To go to the Investment Executive website please click here
All of the parties are offering goodies to help families care for dependents
As they try to secure votes for the upcoming election, Canada’s political parties are taking steps to appeal to the middle-aged “sandwich generation” of Canadians who are struggling to simultaneously support both their children and their parents.
This group of voters — which likely includes many of your clients — is grappling with the costs of caring for their aging parents, putting their children through post-secondary school, and trying save for their own retirement.
Between tax credits for caregivers and financial aid for students, the three main parties’ platforms all feature goodies designed to help the sandwich generation cope with these pressures.
Help for caregivers
Statistics Canada estimates that 2.7 million Canadians are providing care for an older family member, and many face financial woes because of it.
“This is a group of people that either has to take time off work, has to pay for people coming in to help or has to pay for medical devices or other assisted aids. Or, they’ve actually given up their jobs,” says Susan Eng, vice president of advocacy at Toronto-based seniors association CARP. “Many people can’t afford to keep doing this.”
The Conservative party got the ball rolling on this issue in the 2011 budget, with its proposal for a new 15% non-refundable Caregiver Tax Credit on an amount of $2,000 for individuals caring for infirm dependent relatives.
The budget also proposed enhancing the Medical Expense Tax Credit by removing the $10,000 limit on expenses that caregivers can claim.
These proposals were generally well received; however, some organizations suggested they didn’t go far enough.
“We need to continue to work collectively to ensure more is done so that all family caregivers in Canada get the financial support they need and deserve,” said Dan Demers, director of public issues with the Canadian Cancer Society, in response to the Conservative budget.
The Liberals and NDP have upped the ante with more generous proposals. If elected, both parties would create a tax benefit to help low- and middle-income individuals who provide essential care to a family member at home. The Liberal plan would provide a tax-free monthly payment worth up to $1,350 per year, while the NDP proposes a heftier benefit of up to $1,500 per year.
Both parties also propose more EI flexibility for workers taking time off to care for gravely ill family members. Under the current rules, a maximum of six weeks of compassionate care benefits may be paid to eligible individuals who leave work temporarily to care for a family member who has a significant risk of death within 26 weeks. Both the Liberals and the NDP propose extending coverage to six months.
To further support caregivers, the NDP would also introduce a forgivable loan program that would help families renovate their homes to accommodate aging family members.