SOMBA K'E/YELLOWKNIFE
The territorial government was forced to change its policy around income assistance after learning the federal government's increased Universal Child Care Benefit would eat into some NWT families' monthly payments.

The federal government announced retroactive increases to its Universal Child Care Benefit this month. All families countrywide will receive cheques including Guelph, Ont. tourist Tabatha Rossini and her six-month-old son Luca who were visiting the city earlier this month. Those on social assistance, however could be negatively impacted. - Daron Letts/NNSL photo

Around $3 billion is slated to be cashed out by the feds to Canadian families this summer but under the current NWT Social Assistance Act the payments could actually negatively impact those most in need.

Previously, the benefit provided $100 per month for each child under the age of six. That amount has been increased to $160, along with an additional $60 for each child between the ages of six and 17.

The payments are retroactive to January so families will be receiving a lump sum this summer. Parents with children under six can expect to receive around $520 for each child and those with children over six will get a cheque for $420.

"The increase to the Universal Child Care Benefit is welcome; however, there are implications for the Northwest Territories residents," stated Premier Bob McLeod in a news release. "Without a change in approach, these retroactive UCCB payments would reduce the amount income assistance clients receive ... as the UCCB is considered income."

The income assistance program has an annual $1,200 buffer that allows recipients to keep their unearned income without penalty, which includes GST tax credits, income tax refunds and gifts.

Anything over the amount is subtracted from support cheques. Because the UCCB payments are a taxable income, both the retroactive payment and increase had the potential to reduce clients' August payments, it states in the news release.

Yellowknife YWCA executive director Lyda Fuller said she was thrilled when she heard the premier's decision to amend the policy because it means more of the money will now be able to benefit children and not have to be allocated for groceries and rent.

"The intent of the child benefit is to improve the lives of kids, not subsidize the GNWT," she said.

"I was really thrilled the premier made that decision. I thought that showed true leadership ... it's going to make a huge difference, because it's a bigger lump of money and people can actually use it for their kids."

Others were more skeptical of just how beneficial the payments would be in the territory.

Centre for Northern Families executive director Caroline Johnson said any and all support for children is welcome; however, she is concerned some may slip through the cracks.

"I'm really glad the (premier) decided to make allowances for people on income support.

"I do worry still about working-poor families - families that are making just over the income support allocation but still aren't bringing in large enough monies," she explained. "The UCCB is taxable so sometimes it really doesn't help low income families."

While the increases are welcome, Johnson said the benefits are not enough to depend on.

"I think federally and territorially we need to start looking at a guaranteed living-allowance verses these supplements people get."

She said the flat rate is also problematic when families who are generating more than $100,000 a year receive the same support as those making much less - cost of living should also be a factor.

"The North is one of the most expensive regions in Canada, I think our costs are higher," she said.

"Just to find a place to live is difficult and when you find it, it's a huge (cost) and our food is more expensive."

In 2006, the Conservative government replaced the Liberal child assistance program with the Universal Child Care Benefit.

Under the new legislation, families receive a flat amount whereas previously, payments were based on income.

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