The Fraser Institute

The Fraser Institute

November 19, 2013 06:15 ET

The Fraser Institute: 'Family Class' Immigration Reforms a Good First Step but Taxpayers Still Face Significant Costs From Sponsorship of Parents and Grandparents

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Nov. 19, 2013) - Despite Ottawa's recent reforms to 'Family Class' immigration, Canadian taxpayers are still facing high costs associated with allowing immigrants to sponsor their parents and grandparents to come to Canada, concludes a new study published today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

The study, Canadian Family Class Immigration: The Parent and Grandparent Program Under Review, examines issues surrounding Family Class immigration including the new regulations put forth by the federal government's Action Plan for Faster Family Reunification as well as the potential costs to taxpayers of sponsored parents and grandparents.

"We shouldn't shut the door and not allow immigrants to sponsor their parents or grandparents to come to Canada but we need to ensure that taxpayers are adequately protected from assuming the costs of their support and medical care," said Martin Collacott, the study's author, Fraser Institute senior fellow and former diplomat who served in China, Japan and Vietnam as well as High Commissioner to Sri Lanka and Ambassador to Syria, Lebanon and Cambodia.

The backlog of applications from immigrants looking to bring their parents or grandparents to Canada swelled to 160,000 in 2011. In response, Ottawa announced it would raise intake to 25,000 in both 2012 and 2013 and admit another 20,000 from the backlog in 2014. It also indicated it would begin accepting new applications in 2014 after a two-year moratorium and an annual cap of 5,000 on these applications to prevent accumulation of a new backlog.

The government also announced other changes requiring sponsors to take more financial responsibility for supporting their parents and grandparents. But Collacott points out that the changes don't go far enough since taxpayers will still bear much of the expenses of older sponsored immigrants who may be eligible for Canada's various income support programs.

It is estimated that sponsored parents and grandparents received, on average, $6,262 in Old Age Security (OAS) and Guaranteed Income Supplement (GIS) payments plus $1,381 in other government transfers for a total of $7,644 a year. And that doesn't include potential health care costs.

Given that average total income for elderly recent immigrants is estimated at $15,696, it is highly unlikely that senior sponsored parents and grandparents pay enough in taxes to cover the costs of these programs.

Collacott suggests that Canada may want to consider emulating policies used by Australia, which employs a "Balance of Family" test. This test requires that someone wanting to sponsor their parents as immigrants must have at least half of their siblings already living permanently in Australia, or at least more of them living permanently in Australia than in any other country. Australia's rationale is that if the purpose of bringing one's parents to Australia is family reunification, it doesn't make sense for them to come if more members of their family live somewhere other than Australia.

Australia also admits most sponsored parents and grandparents under a program that involves a substantial financial outlay. To obtain a Contributory Parent visa, sponsors must pay a total of $46,286 (AU) in visa fees in addition to posting a financial bond and an assurance of support.

Collacott also recommends the federal government look at requiring sponsors to purchase comprehensive health insurance for parents or grandparents they want to bring to Canada to reduce the strain on the public health care system.

"If annual levels for new applications are raised above 5,000, considerably more attention will have to be given to working out the mechanisms by which taxpayers will be adequately protected in a way that preserves our longstanding record of being welcoming towards immigrants and their families," he said.

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of 86 think-tanks. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit

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