Canadian Taxpayers Shouldn’t Have to Pay for the Care of Immigrants’ Parents

GLOBAL ECONOMICS

IMMIGRATION PAPERS

Patrick Grady
Canadian Taxpayers Shouldn’t Have to Pay for the Care of Immigrants’ Parents
February 16, 2012
of research paper.
Interview on CFRA Radio with host Steven Madely on the parents and grandparents immigration program on February 23, 2012.

One of the aspects of Canada’s immigration policy that is defended most vigorously by immigration advocates is our liberal policy for allowing immigrants to sponsor their parents and grandparents, which is the most generous in the world.

The generous benefits to be derived from joining their children in Canada are quite obvious to the parents and grandparents who are eligible for sponsorship. This has created a steadily increasing demand for admissions. As a consequence, and in spite of the admission of over 450,000 parents and grandparents since 1990 when admissions were stepped up, the backlog has continued to grow, reaching 165 thousand in late 2011. The large backlog has given rise to a long wait time of around 8 years, which has upset many in the immigrant community and caused politicians to fret about losing the immigrant vote. And at hearings before the House of Commons Standing Committee on Citizenship and Immigration last November 17, Citizenship and Immigration Canada officials speculated that if nothing were done applications would continue to come in at 35,000 to 40,000 per year and the backlog would grow to 500,000 by 2020, increasing the wait time to more than 15 years.

The Government subsequently announced policy measures to stem the backlog. These included most notably: an increase in the number of sponsored parents and grandparents to be admitted next year, from nearly 15,500 in 2010 to 25,000 in 2012; a temporary “pause” on the acceptance of new sponsorship applications for parents and grandparents for up to 24 months; and the introduction of a new “super visa” valid for ten years allowing parents and grandparents to visit. The Government also promised to consult with Canadians on the parent and grandparent program on how to redesign the program to make it “sustainable in the future” and to “avoid future large backlogs and be sensitive to fiscal constraints.”

While this all sounds very responsible and sensible, on closer examination, it becomes evident that the Government has punted on the issue and has not really done anything concrete to permanently curtail the demands for increasing numbers of parents and grandparents to be let in and to limit their growing claim on the public purse. To the contrary, it has actually increased the number to be admitted this year by 9,500. The short “pause,” which is supposed to last no more than two years, will do little to reduce the demand for admissions, but merely postpone tackling the problem. And when it is lifted, the backlog will explode.

One of the main justifications for admitting parents and grandparents is that they will take care of the immigrants’ children and enable the immigrants to be more productive. In contrast, child care by grandparents and great grandparents is not an option for most Canadians, who must rely on daycare or other similar, but less formal, arrangements.

While the objective of family reunification is specified in the Immigration and Refugee Protection Act (Sec. 3.1.d), it is a relic of the past. In the old days before telecommunications and jet travel, immigrants kissed their families goodbye and most likely never saw them or spoke to them again. It was as if the family member died for the remaining family members when they immigrated. Now, in contrast, immigrants can talk to their families back home on cell phones every day or even see them on Skype. And they can visit back and forth every year or two thanks to cheap airfares. This is why native-born Canadians move all over Canada and even around the world to live and work and do not expect to bring their parents and grandparents along at the taxpayer’s expense. If Canadians expect to do this, why should it be any different for immigrants?

It can be estimated from the 2006 Census that the admission of parents and grandparents is already costing Canadian taxpayers $1.3 billion per year in increased Old Age Security/Guaranteed Income Supplement (OAS/GIS) and other transfers. It can also be estimated that the program has raised annual health care spending by $4.6 billion. The annual fiscal costs of the parent and grandparent program to all levels of government in Canada could thus easily exceed $6 billion per year. Bringing in the 165,000 individuals in the backlog and the expected increase in numbers applying to 500,000 (including the 165,000) would double the fiscal costs from the $6 billion estimated to a staggering $12 billion.

Many Canadians have trouble understanding the meaning of multi-billion dollar cost estimates like these. Some illustrative examples of the potential benefits to individual immigrant families can put the figures in the perspective of their implications for a household budget. For instance, an immigrant family that brings in one parent or grandparent might benefit from subsidized health care worth $9,600 per year during the senior years of the sponsored parent. The parent might also enjoy Government income support worth on average $7,644. Together this adds up to a total health and welfare benefit of $17,244 per year, which over a 20-year life time as a senior would equal $344,880. And if an immigrant family were able to bring in all four parents of both the husband and the wife, or perhaps a grandparent if one of the parents can’t come, the total fiscal benefit would equal $1,379,520 over the assumed 20-year post-age-65 life of the parents.

The subsidy provided to attract immigrants to Canada is very large, both in absolute terms and relative to family incomes. And don’t expect the immigrants themselves to be able to pay it back. Currently, they are not even earning enough to pay their own share of government benefits.

The fiscal benefit offered to the parents and grandparents of immigrants is a huge enticement. Is it any wonder that so many immigrants are applying to sponsor their parents and grandparents? And how can this be fair to other Canadians who are not eligible for comparable benefits, but instead are left with the expensive tab? Immigration policy should be run to benefit Canadians not to exacerbate the fiscal costs of an ageing society.