Positive effects of child benefit offset by changes in other income programs. (Income Security).

OTTAWA -- The National Child Benefit has been effective in reducing the poverty rate for families with children, however changes to other programs like social assistance and employment insurance may have more than offset its positive impact, says the Centre for the Study of Living Standards.

In a study prepared for Human Resources Development Canada, the centre found the national poverty rate for families with children fell 4.6 per cent between 1996 and 1999 because of the introduction of the NGB supplement. The poverty gap decreased by 8.7 per cent.

The study factored in the provincial clawback of the NCB from social assistance recipients and re-investment in cash or income-support programs. The impact on economic well-being of families with children would be even greater if provincial in-kind programs financed by the social assistance clawback were included, it says.

Yet there was a limited decline in the overall national poverty rate in 1990s despite strong economic growth in the latter years. The study suggests that changes to social assistance and employment insurance, which were not positive, may be the cause.

The study is based on statistical simulations that suggest the NCB will have an even greater positive impact by 2004, when the poverty rate is projected to be 11.8 per cent lower than before the NCB and the poverty gap 18 per cent lower. At the same time, it found the NCB results in a stronger improvement in poverty rate and poverty gap for two-parent families than for single-parent families.