Canada's new child benefit set to boost back-to-school shopping
By Leah Schnurr
OTTAWA (Reuters) - Canada's newly revamped cash handout to families ahead of the start of a fresh school year could spur retail sales during a period of weak economic growth and high consumer debt.
The Canada Child Benefit gives eligible families an annual benefit of up to C$6,400 ($4,980.54) for each child under 6 years old, and up to C$5,400 for each child between 6 and 17.
Dana Calder in North River, Nova Scotia plans to use her C$148 monthly check to let her two daughters, 4 and 14, splurge on purchases beyond the C$300 she has budgeted for, such as a new coat or pair of shoes.
"That always goes right to the kids," said Calder, 42, who runs a couponing blog.
The benefit replaces a similar measure under the previous Conservative government as well as other tax benefits. The government says eligible families will see an average increase of almost C$2,300.
The money likely will help retailers such as Wal-Mart Stores Inc (WMT.N: Quote) and Dollarama Inc (DOL.TO: Quote) more than higher-end clothing and supplies retailers as the benefit is aimed at lower- and middle-income families.
"Those checks will definitely be a nice offset to the economic doldrums that has settled across the country this summer," said Todd Hirsch, chief economist at ATB Financial.
Hirsch said that if not for the benefit, he would have expected lower back-to-school sales this year. Continued...