Smart & Green Family Policy for a Strong Saskatchewan

EconomyDr. Paul Kershaw

University of British ColumbiaHuman Early Learning Partnership

November 15, 2010

North Battleford & Saskatoon, Saskatchewan

of kindergarten children are vulnerable in Saskatchewan.Vulnerability above 10% is not biologically necessary.

27%

Most vulnerable children are not poor!

Life Course Problems Related to Early Life

2nd Decade

3rd/4th Decade

5th/6th

Decade Old Age

• School Failure

• Teen Pregnancy

• Criminality

• Obesity

• Elevated Blood Pressure

• Depression

• Coronary Heart

Disease

• Diabetes

• Premature Aging

• Memory Loss

Early Vulnerabil

ity

BC: Unique Population Laboratory:

Early Vulnerability Quality of Labour Supply

Kindergarten Population

Grade 4Population

Grade 7Population

Grade 12Population

Criminalactivity

to cut incarceration

by a third

Reduce Early Vulnerability to 10%...

# o

f chi

ldre

n

Score on scale of EDIand

% achieving university eligible grades

Low High

29% 41.5%

University eligiblegradesVulnerability

If Then

At K At G.12

The next generation’s Human Capital

# o

f chi

ldre

n

Score on scale of EDIand

% achieving university eligible grades

Low High

10% 55.6%

University eligiblegradesVulnerability

If Then

At K At G.12

The next generation’s Human Capital

What does the early vulnerability debt cost

BC?

1960 – 2000: Research shows…

Countries with 55% of students getting university-eligible grades

vs.Countries with 42% of students getting

university eligible grades…

ENJOYED .63% OF GDP GROWTH MORE PER YEAR, FOR 40 YEARS

Decreased Vulnerability = Increased Growth

0 10 20 30 40 500

200

400

600

800

1000

Years

BC GDP($Billions)

First cohort of 5 year olds benefit from 15 by 15 policy

First cohort graduates

Status Quo (29%

vulnerable)

Reduced vulnerability

(10%) That’s throwing away

$117 billion now + interest over 60

years!

We are here

Reduced early vulnerabilityincreases GDP by

20%

Baseline growthBaseline growth plus 0.63% GDP per year

Investment in family policy is the foundation for a robust human capital

strategy.

Gov’t of Sask Goal:Growth

2008  

Environmental Debt for Future

to Pay

Environmental Debt Growing or Shrinking?

Tonnes CO2/CapitaChange in GHG, %

1990 level5.0 13%7.9 -22%

10.6 0%8.8 -6%5.7 -12%7.7 18%

10.8 -2%8.3 -18%9.8 -21%5.7 1%

18.4 16%18.5 82%9.8 23%

16.5 47%IEA UNFCCC

Limit global warming to 2 degrees Celsius requires absolute reduction in GHG emissions, while population grows.

Option 1:Technological innovation to decouple economic growth from carbon emissions.

Option 2:Move from a growth to a steady state economy and radically transform the meaning of welfare and the institutions for achieving it.

Why 27% vulnerable?

EDI data similar trends across the country

BC vulnerability rate: 29%

15 by 15% Vulnerable on One or More Domains, Early Development Instrument,

2008-09/2009-10

20.8%

22.5%

23.4%

25.4%

25.5%

25.8%

27.1%

27.1%

27.2%

29.6%

32.1%

44.4%

.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

Southwest RIC

Moose Jaw-South Central RIC

West Central RIC

Southeast RIC

Northeast RIC

Prince Albert RIC

Saskatchewan

Saskatoon RIC

Canada Normative II

Regina RIC

Northwest RIC

Northern Human Services Partnership

Percent

A hole in the middle

may be good for doughnuts,

but not for public policy.

Because there is no system of family policy…

Canadian Society is FAILING parents in fundamental ways!

Time PovertyService PovertyIncome Poverty

Reflects appreciation of costs imposed by residential school system; reserves, etc.

Smart Family Policy0 to18 months

Time: improve parental leaveServices: monthly access to health check-

ins and parenting support 0-18 months18 months to six years

Time: re-think ‘full-time’ workServices: early learning and care 18

months to school entry0 to six years

Low-income: make work payLow-income: increase welfare

Parental Leave(year: 2008)

Child (from month 3 to 15)Parents both take 6 months to care. Disposable income relative to couple without children

Lower Earner (takes all 12 months)

Country Year Can$ (controlling for PPPs) Year Can$Denmark 12,915 1,971Germany 1,166 1,054Sweden 1,105 -2,530Quebec -2,548Austria -3,295 -391Czech Republic -5,945 372Slovak Republic -6,958 -2,251Finland -8,468 -4,694Netherlands -8,624 -9,258Spain -9,941 -5,641UK -10,036 -6,274Belgium -10,298 -6,448Norway -10,687 -7,307Canada (outside of Quebec) -10,353 - 11,779 -6,971New Zealand -12,592 -18,999Italy -15,160 -11,653France -16,085 -8,480Australia -16,343 -13,235Ireland -19,044 -10,397USA -23,119 -16,389Japan -24,019 -10,866

Target: $-1,532

Leave

$24635 in Parental Time in year 1$12618 in Parental Time year 2

Supplemented by Healthy Child Check-Ins & Parenting

Support

0.17%

Source: Adapted from Starting Strong ll: Early Childhood Education and Care, September 2006, p.11

Denmark

Sweden

Norway

Finland

France

Hungary

Austria

United Kingdom

United States

Netherlands

Germany

Italy

Australia

Canada

0% 0.5% 1.0% 1.5% 2.0%

Sask.Canada

Canada (outside Quebec)• Few spaces• Insufficient quality • High cost• Inadequate Inclusion

OECDavg.0.7%

UNICEF & EUbenchmark1.0%

0.25%

% of GDP

Public expenditure on ECEC services (0-6 years)

Province

ECEC Expenditure on

Children 0-5, including K’garten

(% of GDP)

Children 0-5 for whom there is a regulated full or

part-time centre based CC

space (%)

Newfoundland & Labrador 18% 17.3Prince Edward Island 24% 41.0

Nova Scotia 30% 22.1New Brunswick 34% 19.9

Quebec 61% 25.0Ontario 36% 19.6

Manitoba 36% 20.6Saskatchewan 18% 9.1

Alberta 10% 17.4British Columbia 22% 18.3

Northwest Territories 59% 23.3Nunavut 14% 20.2

Yukon Territory 69% 28.3

Regulated Early Care and Education, by province(2008)

Source: Author calculations based on The Big Picture, Early Childhood Education and Care in Canada 2008

ECEC more parents synchronize earning and

caringBut new Employment Standards

reduce yearly hours, but contemplate later retirement

40 35 hours * 2 parents: trade $6k for 500 hours

Subsidized by $7-$16k in servicesOne earner couple: 40 35 hours * 1 parent;

ECEC additional employment time for parent 2.

Low-Income Policy : Provincial

Comparisons

Child Poverty Rates by Province40% poor children live with

an adult who works full-time full-year.

2007: 16.7

Province

Yearly Can$Lone

Mother

Yearly Can$1-Earner

CoupleQuebec +5694 +5954Alberta +4954 +6220Saskatchewan +3573 +7863Ontario +2469 +2233BC +1173 +1535Newfoundland +580 +414Nova Scotia +501 +1336New Brunswick -608 +40Manitoba -803 +1271PEI -5635 +289

Australia +

$10658Target =

$5943, rank 7th

In Work Supplement to Earnings*Low Income ($26,620) Families with Toddler (2008)

Australia+

$7890Target =

$6160, rank 3rd

*After child care service and routine health subsidies vs. costs; plus housing subsidies

Child Poverty Rates by ProvincePolicy mechanisms (tax

expenditures) not reaching some citizens? 45% of Aboriginal

children are poor?

2007: 16.7

Norw

ayAu

stria

Denm

arkUK

Swed

enGe

rman

yAu

stra

liaNe

thJa

pan

Finl

andNZ

Fran

ceIre

land

Belg

ium

Cana

daUSCz

ech

Spai

nSl

ovak

Italy

-$5,000

$0

$5,000

$10,000

$15,000

$20,000

$25,000

NDI after housing and routine health care

Lone Mother with Toddler on Income Assistance

Canadian Currency (controlling for purchasing power parities)

(2008)

Province Yearly Can$Quebec 10,615

Newfoundland 9,478

PEI 8,686

Saskatchewan 8,438

New Brunswick 7,378

Manitoba 6,617

Nova Scotia 5,342

British Columbia 4,638

Ontario 4,110

Alberta 2,916

Income after Average Prov. Urban Rent and Routine Health: Lone Mother + Child Age 2 on Social Assistance (2008)

Target: $12,500

Sweden5th

The price of smart family policy...

Funding for Parents

=$288

million

Funding for Community

Services$554 million

Time$138

millionIncome

$150 million

$842 Million/Year

The cost of reducing vulnerability?

$842 Million in Saskatchewan?!?

Less than half what we spend cumulatively on Old Age Security and RRSPs.

Eventual returns outweigh costs by 6/1

About 20% of total fed/prov health care spending.

$842 Million Increase in Spending?

Provincial Health Care Spending($ Billions) 1998 - 2008

SK $1 Billion

SK: $1.2 Billion

Business = Key Beneficiary in Short-

Term

$842 million minus…Short-term returns to Sask employers from Smart Family PolicyProductivity: $68 millionRetention: $157 millionPrivate insurance premiums

$ 3 millionParental leave top up

$ 5 million$233 million

Minimum wage…

Short-term returns for elected officials

$609 million minus…Short-term returns to GovernmentChild welfare: $37 millionGPs, Emerg, Hospitalization: $70 millionPrescription drugs $ 6 millionWorkers Comp $28 millionLabour supply $49 million

$189 million

$420 million minus…Paid for half of SFP, and haven’t even counted K-12 efficienciesHealth care savings from poverty reduction

Haven’t talked about reallocation…Haven’t talked about immediate benefits to families…

$420 million minus…Immediate benefits for families with young kids…

Earnings $105 millionLow-income support

$150 millionTime to care ????

Annual crime reduction

savings grow to $116 million,

Year 4-11

Reduce Early Vulnerability to 10%...

Smart Family Policy= Smart Economics

A Just Cause

But Will We Pursue this Bold Ambition?

Not a Research Question

It’s a question about being Canadian in Saskatchewan!

 2008

Family PolicyCountry Score/10Sweden 10Norway 8Finland 8Denmark 8France 8New Zealand 6Netherlands 5UK 5Germany 4Switzerland 3US 3Australia 2Ireland 1Canada 1

2008 Gender Gap

Ranking3127

1559

13111427248

31

Recommit to Gender Equality to Make Progress on Family Policy/Health

Promotion in the early years

Sources: World Economic Forum and UNICEF

Disease Fetish:Trends in Saskatchewan spendingShare of Total Expenditure:

1985 2008Health 29.4% 38.4%Education 18.7%

21.3%Social Services 9.4% 6.5%

Life Course Problems Related to Early Life

2nd Decade

3rd/4th Decade

5th/6th

Decade Old Age

• School Failure

• Teen Pregnancy

• Criminality

• Obesity

• Elevated Blood Pressure

• Depression

• Coronary Heart

Disease

• Diabetes

• Premature Aging

• Memory Loss

As Medical Care “crowds out” other spending, we must question:

What medical care we owe one another as our capacity to save increases dramatically with costly technology and drugs?

Question:

And what does it mean for a society when it spends hundreads of thousands, if not millions, of dollars to save a pre-term baby – one life – but is remarkably hesitant to invest in health promotion for the population through programs like early learning and care, housing, food? 

Beyond Boomercentrism

 

2009

Fiscal Debt for Future

to Pay

Fiscal Debt Growing since

Baby-boomers

Country

Central Government Debt, % GDP

% increase since 1973

Australia 8%Switzerland 21%Norway 26%Ireland 27%NZ 28%Canada 36% 133%Finland 38%Sweden 38%Denmark 38%Germany 44%Netherlands 50%US 53%France 61%UK 75%Source OECD CANSIM

Intergenerational Injustice

 

2009   2008  

Fiscal Debt for Future

to Pay

Fiscal Debt Growing

since Baby-

boomers

Environmental Debt for

Future to Pay

Environmental Debt

Growing or Shrinking?

Country

Central Government Debt, % GDP

% increase since 1973 Tonnes CO2/Capita

Change in GHG, % 1990 level

Sweden 38%   5.0 13%Switzerland 21%   5.7 1%France 61%   5.7 -12%NZ 28%   7.7 18%Norway 26%   7.9 -22%UK 75%   8.3 -18%Denmark 38%   8.8 -6%Germany 44%   9.8 -21%Ireland 27%   9.8 23%Finland 38%   10.6 0%Netherlands 50%   10.8 -2%Canada 36% 133% 16.5 47%US 53%   18.4 16%Australia 8%   18.5 82%Source OECD CANSIM IEA UNFCCC

Intergenerational Injustice

 

2009   2008   2008

Fiscal Debt for Future to

Pay

Fiscal Debt Growing since

Baby-boomers

Environmental Debt for Future

to Pay

Environmental Debt Growing or Shrinking?

Family Policy for

Young Children

Country

Central Government Debt, % GDP

% increase since 1973 Tonnes CO2/Capita

Change in GHG, % 1990 level Score/10

Sweden 38%   5.0 13% 10Norway 26%   7.9 -22% 8Finland 38%   10.6 0% 8Denmark 38%   8.8 -6% 8France 61%   5.7 -12% 8NZ 28%   7.7 18% 6Netherlands 50%   10.8 -2% 5UK 75%   8.3 -18% 5Germany 44%   9.8 -21% 4Switzerland 21%   5.7 1% 3US 53%   18.4 16% 3Australia 8%   18.5 82% 2Ireland 27%   9.8 23% 1Canada 36% 133% 16.5 47% 1Source OECD CANSIM IEA UNFCCC UNICEF

Intergenerational Injustice

 

2009   2008   2008

Fiscal Debt for Future to

Pay

Fiscal Debt Growing since

Baby-boomers

Environmental Debt for Future

to Pay

Environmental Debt Growing or Shrinking?

Family Policy for

Young Children

Country

Central Government Debt, % GDP

% increase since 1973 Tonnes CO2/Capita

Change in GHG, % 1990 level Score/10

Sweden 38%   5.0 13% 10Norway 26%   7.9 -22% 8Finland 38%   10.6 0% 8Denmark 38%   8.8 -6% 8France 61%   5.7 -12% 8NZ 28%   7.7 18% 6Netherlands 50%   10.8 -2% 5UK 75%   8.3 -18% 5Germany 44%   9.8 -21% 4Switzerland 21%   5.7 1% 3US 53%   18.4 16% 3Australia 8%   18.5 82% 2Ireland 27%   9.8 23% 1Canada 36% 133% 16.5 47% 1Source OECD CANSIM IEA UNFCCC UNICEF

Intergenerational Injustice

Believe myths, not reality

Spring 2010 poll:

82% of British Columbians under-estimated or did not know early vulnerability rate.

86% overestimate how generous Canadian family policy is.

Result: many don’t see smart family policy

as…Productivity policy

Recruitment & Retention policyCrime reduction policy

Health policyGender equality policyDebt elimination policy

Result: Many don’t see the cost of maintaining the

status quo.

Another generation of vulnerable children, and an economy to match.

Result: Many don’t see the cost of maintaining the

status quo.

Another generation of vulnerable children, and an economy to match.

Thank you.

• Paul Kershaw, Ph.D.• The University of British Columbia• College for Interdisciplinary Studies• Human Early Learning Partnership (HELP)• http://www.earlylearning.ubc.ca/PaulKershaw.htm• e-mail: paul.kershaw@ubc.ca

School Achievement (1960s) Associates with Economic

Growth (1960-2000)

Cond

ition

al G

rowt

h

Conditional Test Score

-4-2

-02

4

-1.5 -1 -.5 0 .5 1

+.63% of GDP/year

Source: Hanushek and Woessmann (2008): The Relationship between Economic Growth (1960-2000) and Test Scores (1960).

From the BC Government:

15%vulnerabl

e

BC Government Strategic Plan for 2008/09 - 2010/11, p. 30

Beyond Left and Right

Critiquing Illness Treatment in Favour of Investing in the Determinants of Health must become NON-PARTISAN

This critique is stifled because, culturally speaking, publicly funded medical care is so important to our sense of selves as Canadians, it is a common feature of our social fabric to which we point when distinguishing ourselves from our neighbours to the south.

Being ‘Canadian’ May Be Making Us Less Healthy!

If we leave unquestioned the place of medical care in our commitments to social policy, we risk our health by failing to invest in its social determinants (Kershaw, 2008).

Historical GDP and Revenue ($ millions)SK: Revenue as Share of GDP. Change over Time

SK 1994 Revenue: 21.1% of GDP

SK 2008 Revenue: 19.1% of GDP

200

180

160

140

120

100

80

60

40

20

0

($) B

illion

s

SK: 1994 vs 2008 Revenue =

$1.29 Billion

Child, 0-12 MonthsIncome Time Services Sum SFP Gain

With SFP 47245 24635 1583 71005 +18140Before SFP 38967 24635 52864

Child, 12-24 MonthsIncome Time Services

With SFP 46500 12618 8459 67578 +20892Leave: 6 Months.

Employ: 2*35 hours*26 weeks.Enabled by parent $2550 parent ECEC payment (less $550 tax relief)Before SFP 46686 Paid work 2*40 hours * 52

weeks. Enabled by $5760 in ECEC (less $1400 tax relief)

46686

Couple, no child, Average plus ½ Average Income$79890 Gross Income$49704, Disposable income after taxes, housing and routine health

Avg + ½ Avg Child, 24-36 MonthsIncome Time Services Sum SFP Gain

With SFP 40199 6159 16919 63276 +16590Before SFP 46686 Paid work 2*40 hours * 52

weeks. Enabled by $5760 in ECEC (less $1400 tax relief)

46686

Avg + FT Caregiver Child, 24-36 Months

Income Time ServicesWith SFP 29358 3079+20206+9763 6920 69326 +12734Before SFP 33164 23428 56592

Couple, no child, Average plus ½ Average Income$79890 Gross Income$49704, Disposable income after taxes, housing and routine health

Child, 0-12 MonthsIncome Time Services Sum SFP Gain

With SFP 47245 24635 1583 71005 +18140Before SFP 38967 24635 52864

Child, 12-24 MonthsIncome Time Services

With SFP 46500 12618 8459 67578 +20892Leave: 6 Months.

Employ: 2*35 hours*26 weeks.Enabled by parent $2550 parent ECEC payment (less $550 tax relief)Before SFP 46686 Paid work 2*40 hours * 52

weeks. Enabled by $5760 in ECEC (less $1400 tax relief)

46686

Couple, no child, Average plus ½ Average Income$79890 Gross Income$49704, Disposable income after taxes, housing and routine health

Avg + ½ Avg Child, 24-36 MonthsIncome Time Services Sum SFP Gain

With SFP 40199 6159 16919 63276 +16590Before SFP 46686 Paid work 2*40 hours * 52

weeks. Enabled by $5760 in ECEC (less $1400 tax relief)

46686

Avg + FT Caregiver Child, 24-36 Months

Income Time ServicesWith SFP 29358 3079+20206+9763 6920 69326 +12734Before SFP 33164 23428 56592

Couple, no child, Average plus ½ Average Income$79890 Gross Income$49704, Disposable income after taxes, housing and routine health