This blog post is part of a series of posts that will be focusing on the tax avoidance by Canada’s most wealthy. This series was sparked by findings in the Paradise Papers — the latest leak that revealed the offshore tax haven activities of former Canadian elected officials and political insiders. Tax avoidance is wrong. It robs the Canadian government from paying for and maintaining our health and social programs; ones that work to improve the lives of all Canadians. A government crackdown on offshore tax havens is urgent and necessary.
Gender Responsive Budgeting has been trumpeted as the focus of the Liberal government budget preparation for the past two years. But how deep does the analysis go and how does it affect outcomes, especially around touchy issues like fair taxation?
In 2017, the Liberals announced they conducted the first gender-based analysis (GBA) on a federal budget, with a renewed focus on how budgets will impact both men and women. The announcement along with subsequent policy solutions, featured a gender mission statement, outlining the state of gender inequality in Canada, with a specific focus on labour market participation, poverty and violence and the gender wage gap. With budget 2018 being the second budget to undergo such an approach, a deeper discussion regarding expected outcomes of gender-responsive budgeting is warranted.
Let’s start with taxes. A gender-based analysis of a federal budget should feature our tax system, with careful review of how our tax system affects men and women differently. Doing so would reveal who benefits and who loses from the loopholes that exist in our current system. Tax loopholes such as: the Capital Gains Deduction, Employee Stock Options Deduction, the Meals and Entertainment Deduction and the Dividend Gross-up Credit, are overwhelming used by top income earners, businesses and CEOs to avoid paying their fair share; and amount to billions of dollars in lost revenue. Collecting tax revenue is a key way to ensure that governments have the resources to fund public services and infrastructure, in response to the information and evidence presented in a thorough gender-based analysis. Yet, according to Statistics Canada, in 2014, women only accounted for 22% of the top 1% of income earners; revealing that women are drastically underrepresented at the top. In a recent report by the CCPA that looked at the earnings of top CEOs in Canada, only 3 out of 100 were women. Even in this rudimentary gender analysis it seems clear that tax reform should be a priority when undergoing a gender-based analysis on the federal budget.
In the 2018 federal budget, the government has failed to close down tax loopholes that remain open as tax breaks for our country’s wealthy. They have also have not implemented any new measures to crackdown on offshore tax avoidance and evasion. Rather, they state they are committed to improving existing tax avoidance rules, which do not bring about the progressive tax reform measures we need. See Broadbent’s Filthy Five Campaign, that calls on the government to make tax fairness a priority.
Having failed to adequately address the tax system through gender-based analysis, how does the rest of Budget 2018 fare? First, we need to take a closer look at what GBA+ means, and the results it should produce.
The Canadian government defines a gender-based analysis as “An analytical tool used to assess how diverse groups of women, men and gender-diverse people may experience policies, programs and initiatives. The “plus” in GBA+ acknowledges that GBA goes beyond biological (sex) and socio-cultural (gender) differences.” This definition accounts for the multiple, intersecting identities that require a specific and specialized focus to address the inequality gap beyond just gender. Urban planner and gender justice advocate Prabha Kholsa, distinguishes the difference between gender responsive budgeting (GRB) and a GBA+. She states that a GBA+ offers general guidance on how to do a gender analysis, while GRB tools are used for specific, in-depth analyses. She states that a GBR is designed to “Analyze policies, taxation, revenues, expenditures, and deficits from a gender perspective, i.e. the perspective of both women and men and girls and boys.” Furthermore, she references seven tools that must be used by feminist economist Diane Elson when undergoing gender responsive budgeting.
A gender analysis on the federal budget should ensure that the right people are leading the charge, says gender advocate, Jessica Mustachi. She states there “needs to be an analysis and understanding of the data through an intersectional lens and within the context of people’s lives. Only with an in depth understanding of people’s lived experiences will we be able to assess the impact of policies and programs”. Yet, of course, this requires the government to ensure they are collecting comprehensive, disaggregated data first. Additionally, economist Angella MacEwan highlights the need for the federal government to look at taxes and transfers when undergoing a GBA+. She states the importance of “recognizing that public services play a vital role in reducing inequality and improving the well-being for women and other marginalized groups”. She goes on to say that we need to “go beyond piecemeal approaches” and “ask the question, how does this change systemic barriers”.
How well has the rest of the much anticipated 2018 federal gender budget aligned itself with the approach of our experts? Let’s find out.
There are both hopeful and disappointing aspects of Budget 2018. Here are a few positions worth mentioning (by no means meant to be an exhaustive list):
Highlights of the budget
Gender equity legislation
The government will introduce two pieces of legislation to ensure the work towards achieving gender equality continues.
- GBA+ to be conducted on all future federal budgets
- Pay equity legislation for all federal employees
Canada Worker's Benefit
The former Working Income Tax Benefit (will now be renamed to the Canada’s Workers Benefit), will now feature an auto enrollment, reaching more families. There will now be a higher threshold for retaining benefits, even as one’s working income increases. This will help Canadians lift out of poverty. The need for these reforms were highlighted in a recent Broadbent report.
Parental (Paternity) Leave
A new “use it or lose it” paternity leave for fathers and non-birth parents to allow them to participate in caregiving duties, with the purpose of encouraging women’s participation in the workplace.
Funding for newcomer women
Research funding will be designated to newcomer and visible minority women to develop ways to promote workplace participation in science technology, engineering and mathematics. This is a great use of an intersectional approach when examining workplace participation.
Lowlights of the budget
Pharmacare Advisory Council
There is no actual commitment to creating, funding or establishing a pharmacare program. Instead the advisory council will simply be consulting and studying different models over the next year, and rightfully so, no funds should be allocated to this. The value of universal pharmacare has already been well documented, as has detrimental impacts on millions of Canadians of not having the program. The Parliamentary Budget Officer fully costed various models for the program last year. Implementation, rather than consultation is what is actually needed.
Funding for Black Canadians
$19 million is allocated to Black Canadians for at-risk youth, mental health and research. This number is extremely low, considering that funding is meant to serve Black people all across Canada. The promise of funding goes beyond the government’s mandate, making it insecure and susceptible to being removed by future governments. Furthermore, the money seems to be intertwined with the funding allocated for the proposed new Centre for Gender and Diversity and Inclusion Statistics. Further scrutiny of how this money will be administered and divided is necessary in order to assess its potential impact. The money should be welcomed by the Black community, with the understanding it’s a start, not the end goal.
A feminist intersectional analysis
In this budget, the government demonstrated their awareness of the multiple barriers some women face beyond just gender. There was an excellent use of language and intersectional analysis, both of which are needed to conduct a thorough GBA+. However, there are very few programs directly targeted to specific groups of women facing multiple barriers. For example, this could include, programs to increase participation of women with disabilities in the workforce, or funding/support programs for women facing domestic violence who have precarious immigration status. A feminist intersectional analysis has limited impact if it isn’t paired with intersectional result-oriented actions.
Implementation of a childcare program/ no funding for childcare
In order to truly promote workplace participation in Canada, a national child care program is needed. Aside from Quebec, the cost of childcare leaves many families strapped and unable to work to their full potential due to the lack of childcare spaces and due to the costs. The new parental leave is a short-term band-aid solution, that doesn’t get to the root of the problem.
No new money dedicated affordable and accessible housing or housing that recognizes women's human rights to housing
$11 billion over 10 years was allocated to housing in the 2017 budget.
Funding for Indigenous Peoples
Budget 2018 reflected the government’s commitment to reconciliation with Indigenous Peoples by providing an in-depth analysis of the work needed to be done. Rather than an assessment on whether the amount allocated is sufficient, here are a few highlights:
- $1.4 billion in funding over six years to fund First Nation Child and Family Services.
- $1.8 billion over five years to address boil water advisories and access to clean drinking water
- $2 billion for a new Indigenous Skills and Employment Training Program
- $600 million to support housing on reserves
In sum, this year’s federal budget failed to offer up substantial funding commitments, and chose to remain vague or absent in areas that would actually achieve gender equality. However, the focus on collecting disaggregated data throughout the budget, is evident that the government understands in order to make good public policy through a gendered lenses — thorough, reliable and up-to-date data is a prerequisite. Yet, as MacEwan pointed to earlier, “piecemeal approaches”, like the creation of a new parental leave, failed to eliminate a key systemic barrier: the disproportionate responsibility that childrearing has on women. Nonetheless, the government’s initiative to undergo a GBA and legislate it for all future budgets is the path forward to progress the country needs.