4.1. Benefits and Programs for Children and Families

Again, as I mentioned in my presentation, the key strategy for a policy to reduce or eliminate child poverty, first, is a strong economy....Second, it's the targeting of benefits towards children. We've done that very successfully through the national child benefit strategy, where both the federal and provincial governments have developed particular support systems and income support for children.

We have to do more in that regard.[447]

Andrew Sharpe, Centre for the Study of Living Standards

Despite significant declines in children’s low-income rates since the mid-1990’s, as well as previous commitments by members of the House of Commons to work towards eliminating child poverty, children and their families remain particularly vulnerable to low income and continue to face this situation in large numbers. In 2007, 637,000 children in Canada (9.5%) lived in low-income households.[448] As outlined in Chapter 1 of this report, certain groups of children, including children with Aboriginal identity, children with disabilities, recent immigrant children and children in female-headed lone-parent families, are particularly vulnerable to living on low incomes. While the Committee is pleased that children’s low-income rates continue to fall, we believe that no child in Canada should live in poverty and that more must be done to increase the living standard of young Canadians and their families.

Living on low income can have detrimental consequences in a variety of aspects of children’s lives. Witnesses told the Committee that poverty hinders children’s development, decreases their health and educational outcomes, and limits their ability to fully participate in society. Children living in low-income families are also more likely to live on a low income as adults, thus perpetuating a cycle of poverty.

We also know that the effects of poverty go beyond mere money and income. Among other sources, Statistics Canada reports that the effects of poverty on children have many detrimental outcomes, including on health—both physical and mental—education, development, and behavioural disorders. There is also a higher probability that as adults, those children will grow up living in poverty as well. Addressing these needs lowers other life barriers as well.[449]

Dave Quist, Institute of Marriage and Family Canada

There are many external factors and conditions that affect a child's ability to learn and a teacher's ability to support that learning, but none as critical or complex as child poverty.

Children who come to school hungry, dressed poorly or ill cannot concentrate in class. This is the beginning of a vicious cycle, where children are not successful in school, become disengaged, and often years later leave school without graduating. Poverty and income inequality affect all members of society, but have much longer lasting effects on children.[450]

Reno Melatti, Ontario Teachers' Federation

We see increased rates of injury and death from injury, teen pregnancies, delinquent behaviours, visual and hearing problems and decreased academic outcomes, school readiness, post-secondary training and education and participation in cultural and recreational opportunities. In other words, child poverty poisons the developing brain and the spirit.[451]

Dr. Andrew Lynk, Canadian Paediatric Society

The Committee heard that poverty reduction interventions at an early age are particularly important. Not only do they have the greatest impact at this formative time in a person’s development, but they also lead to greater returns over the long run.

If we can make investments that will change the opportunities for children, we are all better off for it. It's not just about the kids who benefit. We are all better off in a very tangible way. We will pay less down the road if we get there early.[452]

Hon. Deb Matthews, Government of Ontario

The Committee also heard extensively about the importance of child care, also known as early childhood education and care (ECEC)[453] as a means of reducing poverty. Not only do high-quality early education and child care programs contribute to children’s future well-being by fostering healthy development, but they also give parents and family members the freedom to pursue educational and work opportunities, as well as to engage in other aspects of civic life. Conversely, a lack of access to affordable child care can be a significant obstacle to acquiring training, entering the labour market and escaping low income. Child care services are particularly important for groups at risk of poverty such as women and new immigrants, who face a variety of challenges in entering the labour market and are more likely to live on low incomes.

Child care is significant because of its social policy value and its economic policy value. In terms of social policy, we know from a burgeoning literature, a very vast literature, about the value of investing in early childhood development, from the perspective of readiness to learn and support for good mental health and development over the years. But we also know that high-quality, affordable child care is essential to economic policy because it enables families to pursue education and to participate in the labour market.

[...]

By the way, the other aspect of investing in child care is that it does create a lot of jobs for women too. We were talking before about the infrastructure money not being particularly valuable for women with respect to employment. Well, women are disproportionately involved in terms of the caregivers in early childhood centres, and investing in child care creates employment for women as well. There are both support and employment opportunities for women through that kind of investment.[454]

Sherri Torjman, Caledon Institute of Social Policy

High-quality, accessible child care is another important key to getting out of poverty, essential to support employment and learning, a strategy that is critical to women's equality, an important element of reconciliation with our aboriginal peoples, and a key to social inclusion for newcomers in Canada.[455]

Susan Russell, Canadian Federation of University Women

Improving child care services will reduce poverty by increasing family incomes in three important ways. By improving child care availability, we support parents in maintaining and increasing their labour force attachment. Labour force attachment itself is essential to poverty reduction, although, as others will have described, it's in no way a guarantee. By improving child care affordability, we reduce parent fees, lowering the cost associated with increased labour force attachment. By improving child care quality, we support children's healthy development. In the long term, this leads to improved educational outcomes and earnings.[456]

Jody Dallaire, Child Care Advocacy Association of Canada

In 2004-2005, 55% of children ages one to five were in some form of non-parental child care. While the majority of these children received care in another private home, an increasingly large proportion attended daycare centres.[457] Unfortunately, recent data indicates that Canada’s ECEC system is unable to meet the needs of many families. In 2008, 20.3% of pre-school age children had access, on a full- or part-time basis, to regulated centre-based spaces,[458] while 18.6% of children up to age 12 had access to a regulated child care space. That year, Canada had 867,194 regulated child care spaces for children ages zero to 12 years, an increase of 29,271 spaces since 2007. The majority of these regulated child care spaces (75%) were not-for-profit.[459] Witnesses who appeared before the Committee were alarmed by the insufficient number of child care spaces and also expressed concerns about the cost and quality of child care in Canada. They explained that, as a result of these and other challenges, Canada performs poorly compared to other developed countries in regards to ECEC services.[460]

I have some evidence about the state of ECEC policy and programs. First of all, the programs themselves are in very short supply. You can just look at waiting lists across the country and desperate parents' newspaper stories. A second thing is that the quality of child care in Canada is rarely high enough to be developmental. It's underfunded. It's not good enough.

In addition, regulated child care is usually too expensive, even for ordinary families, let alone for low-income families; and most families, if they can afford to, use unregulated private arrangements, which are often unsatisfactory from both a reliability and a quality perspective.

Finally, although no families have good access to child care, some groups have especially poor access, and here I would note aboriginal Canadians, immigrants and refugees, and parents working at non-standard hours and non-standard jobs. All of these are most likely to be low-income families.[461]

Martha Friendly, Childcare Resource and Research Unit

The crisis in child care in Canada outside of Québec has been confirmed by a series of international studies. In 2006 the OECD reported that Canada has the lowest early learning and child care access rate in 20 developed countries and invests the least public funds of the 14 reporting countries.[462]

Jody Dallaire, Child Care Advocacy Association of Canada

The federal government offers a variety of financial supports to Canadians to enhance the well-being of children and families. It operates the Canada Child Tax Benefit (CCTB) and the Child Tax Credit (CTC), as well as programs related to child care, including the Child Care Expense Deduction (CCED), the Universal Child Care Benefit (UCCB), and maternity and parental benefits. In addition, the federal government cooperates with other jurisdictions by providing dedicated transfers to provinces and territories through the Canada Social Transfer (CST). These transfers enhance the benefits and services provided to Canadian children and families by other levels of government.

a. The Canada Child Tax Benefit and National Child Benefit Supplement

The CCTB is the largest federal child benefit and a cornerstone of Canada’s income support system for children and families. Every year the CCTB delivers $9.4 billion in benefits[463] to around 3.9 million families with 6.8 million children.[464] Eligible families with children under 18 years of age receive the benefit through monthly, non-taxable payments. The CCTB payment is made up of the CCTB base benefit, which is available to a large majority of families including the non-poor and is intended to help parents with the cost of childrearing, and the National Child Benefit Supplement (NCBS), which provides additional support to low- and modest-income families. The NCBS represents the federal contribution to the National Child Benefit (NCB), a joint initiative of the Federal-Provincial-Territorial governments, as well as First Nations. The base benefit of the CCTB in 2009-2010 is $1,340 per year and the NCBS has a maximum annual value of $2,076. These amounts vary, however, according to family size, net income and province of residence.[465] Families caring for children with mental or physical impairments may also qualify for the additional amount of the Child Disability Benefit (CDB), currently up to $2,455 per year for each eligible child.[466]

The CCTB is an important and successful component of the federal government’s child benefit system. Research shows that the current system of federal child benefits reduces the poverty rate of families with children by 38%.[467] The NCBS portion of the CCTB, along with provincial and territorial investments in the NCB program, prevented between 67,500 and 78,800 families with between 144,500 and 171,100 children from living on low incomes in 2005.[468] Witnesses who appeared before the Committee commended federal investments in the CCTB and spoke of its value for poverty reduction.

Child benefits take a hefty whack out of the poverty statistics. If there were no federal child benefits, the low-income rate for families with children would be 15%. Under the current system of federal child benefits, the low-income rate for families with kids is 9.3%... [469]

Ken Battle, Caledon Institute of Social Policy

During its hearings, the Committee was also alerted to some shortcomings of the CCTB program. Some provinces and territories are reducing the amount of social assistance they provide to children and families by the amount of the NCBS, effectively “clawing back” this federal benefit. This “clawback” was a key feature of how the NCB was designed, allowing provinces to reinvest social assistance savings in additional benefits and services for low-income families. Over time, however, most provinces have ceased to “claw back” the amount low-income families receive from the NCBS. Witnesses told the Committee that these clawbacks have resulted in a complex system of benefits across the country that fails to provide the support that low-income children and families need and deserve. Numerous witnesses proposed increasing the total amount of the CCTB, including both the base benefit and NCBS components, as well as taking steps to end the clawback of the NCBS at the provincial/territorial level.

Personally, I think it's important to give some families who need it money. I think the [N]ational [C]hild [B]enefit is a good program. I'm a part of Campaign 2000 as a national partner. I think that putting a lot of that money into the [N]ational [C]hild [B]enefit, and not making it a universal program but skewing it down to the people who need the money the most, would be a really good use of public money.[470]

Martha Friendly, Childcare Resource and Research Unit

We at the Children's Aid totally support the Campaign 2000 policy solutions. These include a full child benefit of $5,200 a year. In fact, child benefits have been a pretty big success story in Canada over the years in terms of reducing poverty. We feel that they have a little more to go, but they can really have quite an impact on poverty.[471]

Colin Hughes, Children's Aid Society of Toronto

... under Caledon's proposal for a $5,000 maximum CCTB we would reduce [the low-income rate for families with children] further, to 8.3%. We'd see similar reductions in the numbers of low-income families and the depth of poverty.

The answer to further progress against child poverty in terms of child benefits is a simple one: the Canada child tax benefit is there. All we need to do is make further incremental improvements and we can reach the $5,000 target.[472]

Ken Battle, Caledon Institute of Social Policy

The ESPC [Edmonton Social Planning Council] proposes that the child tax benefits be increased by $400 per child in next benefit year starting July 1, 2010. There should be further real increases of $200 per year in the following four benefit years. To help pay for this proposal, the non-refundable child tax credit should be eliminated.…The $1.5 Billion in savings should instead be invested in the refundable benefit allowing it to be increased by about $200 annually at no extra cost to government.…By July 2014, the maximum benefit would increase to $6,496 for children under age 6, and $5,138 for children between 6 to 17 years.[473]

John Kolkman, Edmonton Social Planning Council

The Committee believes that financial support for children and families on low incomes is a fundamental component of a federal commitment to poverty reduction and that, in order to successfully reduce poverty in Canada, children must be the target of bold new investments. It is our view that these investments would best be made as part of the CCTB, a benefit that significantly enhances the well-being of millions of Canadian children and their families and makes a particular difference in the lives of those most in need. The Committee urges the federal government to incrementally increase the CCTB to reach a maximum annual amount of $5,000 in five years’ time. The Committee also suggests that the federal government have open discussions with its provincial and territorial counterparts about ending the clawback of the NCBS to ensure that the full amount of federal benefits reaches deserving individuals.

Recommendation 4.1.1

The Committee recommends that the federal government incrementally increase the annual amount of the Canada Child Tax Benefit—including both the base benefit and the National Child Benefit Supplement—to reach a minimum of $5,000 per child within five years’ time.

b. The Child Tax Credit

The federal government introduced the CTC in the 2007 Budget. This new child benefit program provides families with a maximum annual tax savings of $310 for each child under 18 years. In 2008-2009 the program was estimated to provide a total of $1.5 billion in tax relief to about 3 million families.[474] Since the CTC is non-refundable, however, those who do not pay taxes, by and large the poorest Canadians, cannot receive the benefit. This was identified by witnesses who appeared before the Committee as a serious deficiency, one that limits the program’s ability to effectively combat poverty among Canadian families.

Tax measures need to be designed very carefully if they are to contribute to poverty reduction goals. A good case in point is the difference between the child tax benefit and the child tax credit. The child tax credit, announced in the 2007 budget, while providing a modest benefit to families with children who had taxable income, did absolutely nothing for the poorest children whose families have no taxable income at all.[475]

Dennis Howlett, Make Poverty History

c. The Child Care Expense Deduction and the Universal Child Care Benefit

The federal government also provides financial support to families for child care costs. The CCED allows families to deduct expenses incurred for a variety of types of child care from taxable income. Up to $7,000 for children under seven years and up to $4,000 for children seven to 16 years can be claimed. Businesses that create child care spaces in the workplace can also receive an investment tax credit of 25%, up to a maximum of $10,000 per space created. The introduction of the UCCB in 2006 broadened the range of income supports available to families. The UCCB is a taxable payment of $100 per month ($1,200 per year) for each child under age six. It is provided to every family in Canada regardless of income and delivers more than $2.4 billion each year to approximately 1.5 million families with over 2 million children.[476] The UCCB can be spent as recipients see fit and is intended to give families the flexibility to choose the best child care options for their needs.[477]

Many witnesses who appeared before the Committee argued that the UCCB does little to enhance Canada’s child care system. They claimed that the UCCB provides insufficient financial support compared to the cost of child care, particularly after taxes; is not targeted to assist low-income Canadians and has no redistributive effect; and does not necessarily support child care or the creation of child care spaces because there are no restrictions on how it is spent.

With regard to direct funding to families, I can speak more specifically about the program for families: $100 a month per child under the age of six. Families have told us that they do appreciate the program. There might be enough left over after taxes to pay for the gas to take their children to child care but it does not in any way help them find a space when none are available. Even when they find a space, the cost of child care is about $12,000 a year. There is a large gap between these amounts.[478]

Jody Dallaire, Child Care Advocacy Association of Canada

Not only is the universal child care benefit a taxable benefit – and therefore what you see is not what you get – but what you get depends on what province you live in, because it's also taxed through provincial and territorial income tax. If we gave examples, in some places high-income families would end up with more money than low-income families in another province. It made for a very irrational system.[479]

Ken Battle, Caledon Institute of Social Policy

The Committee understands the importance of government support for child care, but some members of the Committee share the concerns of many witnesses about the value of the UCCB program. In order to effectively combat poverty in Canada, the Committee believes that federal funding should target low-income children and families, and that the creation of accessible and affordable child care spaces should be a priority. However, some witnesses also indicated that the UCCB should be retained. In light of contradicting testimony on the value of the UCCB, some members of the Committee believe that the federal government should appoint an expert panel to thoroughly evaluate the effectiveness of the UCCB as a tool for supporting child care. The impact of the UCCB on reducing the incidence of low income among families should also be evaluated. The findings of the panel should be reported publicly and the government should follow up on their recommendations.

The universal child care benefit should be retained, in our view, for all Canadian families with children, as it provides extra support to younger families with preschool-aged children. While it is not a child care program as such, it does help younger families pay a portion of their child care costs. … However, the UCCB should be non-taxable, indexed, and better integrated with the overall child tax benefit system.[480]

John Kolkman, Edmonton Social Planning Council

Let's be specific. The UCCB is ineffective. It is $100 a month. Of course, people appreciate money in their pockets. But if one looks at its goals, one sees that it's not really delivering child care services. In most situations, there are not services to buy, and it's not enough to assist in buying services.

Let's look at it as an income transfer, which is what it is. I would suggest that it needs to be “reconciled” with the child benefit, which is progressive.[481]

Laurel Rothman, Campaign 2000

Recommendation 4.1.2

The Committee recommends that the federal government appoint an expert panel to thoroughly evaluate the effectiveness of the Universal Child Care Benefit (UCCB) as a tool for supporting early learning and child care. The impact of the UCCB on reducing poverty in Canada should also be examined. The findings of the panel should be made public, and the government should follow up on their recommendations.

d. Transfers to Provinces and Territories

Early Childhood education and care (ECEC) are primarily the responsibilities of the provinces and territories.[482] Each of these jurisdictions has a regulated child care program, and together they provide almost all funding for regulated child care in Canada. In 2007-2008, provincial and territorial allocations for this purpose totalled more than $3 billion, with Québec alone spending $1.7 billion.[483] The federal government supports provincial and territorial government investments in ECEC through dedicated transfers. Since the 2007 Child Care Spaces initiative, the federal government transfers $250 million annually to provinces and territories for early education and child care. About $350 million annually is also delivered in accordance with the 2003 Multilateral Framework Agreement on Early Learning and Child Care, which requires provinces to report publicly on their progress in this area.[484] Research has shown, however, that many provinces have not met reporting requirements[485] and that the creation of new child care spaces has slowed compared to the early 2000s.[486] This matter was of concern to witnesses who appeared before the Committee.

In a province that is screaming for more quality child care and education and that has long waiting lists, the fact that there is apparently no accountability in terms of the federal dollars that have been transferred to create child care spaces in this province is a shame and needs to be looked at.[487]

Bill Moore-Kilgannon, Public Interest Alberta

All members of the Committee agree that ECEC plays an important role in efforts to reduce the incidence of poverty in Canada. Witnesses told the Committee that more should be done by the federal government to help low-income families and children access child care and early intervention programs. Many recommended that the federal government develop a national strategy on ECEC that ensures high quality, inclusive and accessible child care.

Lack of quality child care is a significant barrier to women's engagement in the economy. An effective poverty reduction strategy must address child care in a way that's flexible or in line with local labour market conditions and women's child care responsibilities. A national child care strategy is essential.[488]

Beverley Wybrow, Canadian Women's Foundation

The federal government must address this fundamental building block of poverty reduction through creating a national not-for-profit child care system. This process could begin with the restoration of multi-year federal funding to the provinces through dedicated capital transfers. This money should go to community-based child care services, so that the provinces and territories can begin to build this critical child care assistance.[489]

Susan Russell, Canadian Federation of University Women

We also believe there should be the creation of a national child care plan. We saw this looming before the election in 2003. We would very much like that back. We don't think that either the [N]ational [C]hild [B]enefit [S]upplement or the universal child care benefit is making up the difference for, as we say, a national, accessible child care plan for everyone at any income level. This is good for children for all kinds of reasons, which Laurel Rothman has already set out. Furthermore, it provides parents with the ability to get out and work as they need.[490]

Patricia Smiley, South Etobicoke Social Reform Committee

…Canada should immediately commit to spending 1% of its GDP on early learning and care services. These funds should be directed to supply side development, aiming to build a high-quality, developmentally appropriate, and inclusive national early learning and care program, knowing that this will bring benefits for all children, and especially for children living in poverty.[491]

Susan Prentice, University of Manitoba

The Committee recognizes that the social and economic benefits of child care and early education programs are far-reaching and has advocated on behalf of strengthening Canada’s ECEC system in the past.[492] A national strategy on ECEC would have to be elaborated in collaboration with provinces and territories and, to be successful, would have to include dedicated multi-year federal transfers. It was also suggested that it should include benchmarks and timelines for the creation of additional regulated child care spaces and require provinces and territories to report publicly on their success. A national strategy on ECEC would have to be grounded in the principles of accessibility, quality and accountability, and some witnesses thought that it should be enshrined in legislation. The Committee was told that moving forward on this issue would not only demonstrate the federal government’s commitment to children and families, but also greatly contribute to poverty reduction efforts.

Recommendation 4.1.3

The Committee recommends that the federal government work with provincial and territorial governments and stakeholders to develop and implement a national strategy on early childhood education and care, including the creation of a national public child care system, while respecting that Québec already has its own public network of child care centres since 1997 and recognizing its right to opt out with full compensation.

e. Maternity and Parental Benefits

In Canada, the terms and conditions of maternity and parental leave are determined at the provincial level, while benefits for eligible parents are provided by the federal government through the Employment Insurance (EI) program.[493] Maternity and parental benefits are available for a maximum of 15 and 35 weeks, respectively. During this time, recipients receive a basic benefit of 55% of their average insured earnings, up to a yearly maximum insurable amount of $42,300. The maximum weekly benefit is therefore $447. Low-income families who already receive the CCTB may also qualify for the additional amount of the EI Family Supplement. Witnesses who appeared as part of the Committee’s study were concerned that maternity and parental benefits provide insufficient financial support, are too short in duration, and are inaccessible to those who do not qualify for EI. Data show that in 2006, about 60% of new mothers took paid maternity leave.[494] The Committee believes that maternity and parental benefits are essential supports for new families and should be widely available. The points raised by witnesses may be indicative of areas for future improvements to Canada’s maternity and parental benefits system.

There are other offshoots that could also provide support, such as extended parental leave, mother's leave beyond the year. Look at the European programs that deem or give value to mothering and parenting beyond that time. Thank heavens, we have the year now, but a lot of our parents on low income cannot afford to stay off a year; it is not viable for them to stay off a year.[495]

Sharon Lawlor, North End Community Health Centre

4.2 Benefits for Persons with Disabilities

Today, persons with disabilities are among the poorest of the poor in Canada, among the most unemployed in Canada, among the most chronically marginalized in this country. We submit that ongoing situation, that ongoing plight, is a national disgrace. It's nothing short of a national disgrace in a country like this. [496]

John Rae, Alliance for Equality of Blind Canadians

According to the latest Statistics Canada Participation and Activity Limitation Survey (PALS), conducted in 2006, 14.3% of Canada’s population (4.4 million Canadians) has some form of activity limitation. This is an increase from the 2001 disability rate of 12.4% or 3.6 million Canadians. [497] According to a 2007 report, it was estimated that some 30% of Aboriginal people have a disability.[498] The incidence of disability also increases with age. Canadians aged 65 and over had a disability rate of 43.4% in 2006.[499] As Canada’s population of seniors will be growing considerably in the next decade, we can expect the disability rate to continue to rise.

People with disabilities are a diverse group with a wide range of activity limitations that impact to various extents on their ability to participate fully in Canadian society. Compared to other working-age Canadians, working-age people with disabilities are less likely to have completed higher levels of education, to be gainfully employed, and to have an acceptable standard of living. They often have difficulty securing employment and many are not in the labour force. Those who do work are more likely to earn low wages. In addition, people with a mental illness and those with episodic disabilities are more likely to have a sporadic attachment to the labour market with negative impacts on their earnings.

Persons with mental illness face several barriers that prevent opportunities for economic advancement. They often encounter difficulty securing adequate education and employment and face undue discrimination and stigma in these domains due to their mental health status as well as society's misconception of mental illness. Due to these factors, persons with mental illness often cannot earn adequate income in the labour market and must rely on income support programs.[500]

Ruth-Anne Graig, Canadian Mental Health Association

While an important gap remains between people with disabilities and those without disabilities, the employment situation of people with disabilities has improved over the last decade with the growth of the Canadian economy. In 2001, 13.2% of people with disabilities were unemployed compared with 10.4% in 2006.[501] However, it is likely that the 2008-2009 economic downturn will have a negative impact on the employment rate of people with disabilities and we may find in the years ahead that they will have lost some of the ground gained in the 2001-2006 period.

Persons with disabilities are at greater risk of living on low incomes than those without disabilities. In 2006, the incidence of low income for all working-age economic families was 17.2% using the Market Basket Measure (MBM). However, in families where the main income recipient had a work-limiting disability, the incidence of low income was much higher at 32.8%. Data collected over the 2002 to 2006 period show that this population group is also more likely to live in persistent low income (26.3%).[502] Aboriginal people with disabilities living off-reserve were also more likely to be living in households with an income below the pre-tax LICO (42%) than were Aboriginal people without disabilities (32%).[503]

The Committee was told that the current disability income security system does not adequately protect people with disabilities from falling into poverty. The system is increasingly complex, an intricate web of policies, programs and eligibility requirements that vary depending on the definition of disability, the type of disability and the place of residence in Canada. Many individuals with a disability have no other option but to survive on meagre social assistance benefits. According to the National Council of Welfare, in 2008, the welfare income for a single person with a disability ranged, depending on the province of residence, from a low of $8,496 in New Brunswick to a high of $13,337 in Alberta.[504] Knowing the cost of living today, members of the Committee recognize how difficult it must be to survive on such a low income, even more so for a person who has additional disability-related costs. Not surprisingly, research shows that people with disabilities use food banks for a longer period of time than other food bank users and are more likely to experience food deprivation and persistent poverty.[505] Some witnesses referred to the realities faced by too many persons with disabilities who live in poverty in a prosperous nation such as Canada as a national disgrace, and we agree. Many asked for investments in reducing low income among persons with disabilities.

The time is now for a comprehensive investment by the Government of Canada for the alleviation of poverty experienced by Canadians living with a disability. While it is easy to see that reduction in poverty within this community will be directly linked to a reduction in government social support related expenditures, this is not just a disability community issue. If poverty is reduced in this sector all Canadians benefit.[506]

Canadian Paraplegic Association

For an Inclusive and Accessible Canada to be a reality, the Government of Canada must show leadership and commit to addressing poverty and reforming Canada’s income support programs for persons with disabilities.[507]

Council of Canadians with Disabilities

The Government of Canada offers numerous programs and initiatives related to employment, education, accessibility, and income support that aim to provide an opportunity for social and economic security and a better living standard for Canadians with disabilities. This section of the report will highlight some of the steps taken by the federal government to promote the human rights of persons with disabilities and will discuss key federal initiatives that contribute to reducing poverty among persons with disabilities and their families.

a. Human Rights

The Committee was told that freedom from poverty for all Canadians including people with disabilities is a human right. Canada has a strong reputation internationally for being a leader on disability rights issues and assisted in the development of the Convention on the Rights of Persons with Disabilities (CRPD) that was adopted by the United Nations General Assembly in December 2006.[508] Canada was one of the first countries to sign the CRPD in 2007, a symbolic gesture of support for the rights of people with disabilities. However, the CRPD must also be ratified for its terms to be binding.

After consultations with provincial/territorial governments and Aboriginal organizations, and with the support of the disability community, the Government of Canada tabled the CRPD in the House of Commons on December 3, 2009, the International Day for Persons with Disabilities. On March 11, 2010, the Government of Canada took the final step and ratified the CRPD at the United Nations.

All members of the Committee applaud the federal government for joining numerous other countries in ratifying the CRPD and showing leadership on disability rights. The Committee believes that the Canadian Charter of Rights and Freedoms, the Canadian Human Rights Act, and provincial human rights acts, along with the CRPD, will provide a solid rights-based framework to prohibit discrimination against people with disabilities and build an inclusive Canadian society.

I think Canada's ratification of the convention is important for a number of reasons, one being that we were very actively involved in its development. Canada was a leader on really critical issues in the convention, in particular the issue of legal capacity. This convention introduces something known as supported decision-making, which is recognized internationally as a “made in Canada” concept. I think Canada's contributions to the international community in this regard and in a number of regards on the convention could be incredibly beneficial, both for Canada and for other countries.

[...]

I think that provides us a really useful tool and can provide a great framework to move forward on legislation here in Canada.[509]

Anna Macquarrie, Canadian Association for Community Living

b. Income Security for People with Disabilities

Human Resources and Skills Development Canada offers a number of income support programs and other measures to assist persons with disabilities in maintaining a decent living standard and prevent them from falling in poverty. The Office for Disability Issues (ODI), established in the 1980’s, “is a focal point within the Government of Canada for key partners working to promote the full inclusion and participation of Canadians with disabilities in all aspects of society and community life.”[510] The ODI publishes a report annually on disability issues entitled Advancing the Inclusion of People with Disabilities. According to its latest report, the federal government is making progress on these issues and has recently introduced new measures in support of its disability agenda.[511]

Canada Pension Plan Disability Program

The most important federal income support measure for people who have been in the labour force but have had to stop working because of a disability is the Canada Pension Plan Disability (CPPD) program. It provides workers who contribute to the Canada Pension Plan (CPP) with access to benefits should they have a severe and prolonged disability that prevents them from working on a regular basis. The CPPD benefit is a complement to other forms of financial support that individuals with disabilities may already have such as private insurance, personal savings and employment benefits programs. In 2008-2009, about 311,000 individuals with severe and prolonged disabilities received CPPD benefits totalling $3.3 billion. The average payment as of July 2009 was $803.33 per month and the maximum benefit for 2010 was set at $1,126.76 per month. Children of a CPPD beneficiary may be eligible for children’s benefits up to the age of 25. In 2008-2009 they received an average $213 monthly benefit.[512] Individuals must go through a three- to four-month waiting period to be deemed eligible to receive a first CPPD payment.

There have been long standing issues with regard to the eligibility criteria set for CPPD. Many people with episodic illnesses have been refused benefits because their illness or condition may not be considered a severe and prolonged disability under the terms of the program or they have not worked and contributed a set amount to CPP in four of the last six years. The Committee heard about the particular problems faces by people with a mental illness.

CPP disability benefits are another thing. While technically, legally, they apply to mental illness, all of the tests you have to pass in order to get CPP disability benefits are clearly geared toward a physical ailment. You will be incapacitated for some period of time, but the incapacitation is a physical limitation, not a mental one.

In general, if you look at the programs, it would make a lot more sense to me to say, let's not keep trying to twist and tinker with a program that is designed for a physical illness; let's take mental illness out of those programs and design a single program to deal with the unique characteristics that mental illness has, which is, typically, longer to get better, sometimes episodic, and the nature of treatment is also different.

So I think the answer to your question is that I would actually favour looking at a new way, in some sense, a set of programs designed for people with a mental illness.

Now that CPP is allowed to run pilot projects, which they weren't until the last couple of years, I think you have a vehicle that would make experimentation possible.[513]

Hon. Michael Kirby, Mental Health Commission of Canada

Members of the Committee agree that pilot projects could be particularly effective in determining what reforms would work to help people with a mental illness that may be in and out of work because of the episodic nature of their condition, and encourage the federal government to consider this suggestion as it moves forward with reforms of CPPD.

In addition to providing income support to CPP contributors with disabilities, the CPPD program also offers vocational rehabilitation for those who may be able to return to work. However, participation in the program is voluntary and the uptake is low because, in many cases, the combined loss of CPPD benefits and disability supports outweighs the potential earnings from work. The Working Income Tax Benefit (WITB) Disability Supplement[514], introduced in Budget 2007 and enhanced in Budget 2009, is intended to offset these work disincentives, but this measure is only available to low-income workers with disabilities who qualify for the Disability Tax Credit (DTC) and many CPPD beneficiaries do not receive the DTC. Some witnesses raised the issue of the lack of coherence between different federal programs for people with disabilities and recommended that those who qualify for CPPD benefits should automatically qualify for the DTC.

Recommendation 4.2.1

Given the lack of consistency in the definitions of disability and eligibility criteria across federal disability programs, the Committee recommends that the federal government ensure that those who qualify for the Canada Pension Plan Disability automatically qualify for the Disability Tax Credit. The Committee further recommends that the federal government initiate discussions with the provincial and territorial governments to bring some consistency and coherence to the definitions of disability used by programs in all jurisdictions.

The government dedicates relatively few resources to the CPPD Vocational Rehabilitation Program. In 2008-2009, only $1.7 million was spent on this program, down from $4.6 million in 2002-2003. In previous reports, this Committee called attention to this fact and asked that more resources be allocated to the Vocational Rehabilitation Program.[515] Considering the socio-economic benefits that can accrue to individuals who participate in such a program and the cost savings to the CPP account for every person who returns to work and ceases receipt of CPPD benefits, we reiterate the call made by this Committee for further investments in the Vocational Rehabilitation Program[516] and for more effort to be put into removing barriers to participation in this program.

Recommendation 4.2.2

The Committee recommends that the federal government double the budget for the Vocational Rehabilitation Program and begin to measure the long-term impact of this program on the success of clients’ return to work and the total economic benefits associated with these outcomes.

Other incentives currently in place to encourage CPPD beneficiaries to return to work to the extent that they are able to do so include opportunities to volunteer and attend school, as well as the right to earn up to $4,600 (2009) before taxes per year without having to report these earnings. Some witnesses thought that CPPD beneficiaries should be entitled to earn more per year to encourage them to work to their fullest ability.

Greater attention should be paid to supports for CPPD recipients to return to work either on a full time or part time basis. A system of decreasing CPPD benefits should be explored as individuals gain greater attachment to the labour force. All income support programs should have a presumption of employability and remove disincentives to employment from income support programs.[517]

Council of Canadians with Disabilities

It is our understanding that at present adults with disabilities accessing the Canada Pension Plan are not allowed to earn more than $4800 yearly without losing benefits. This is again an example of support systems keeping clients dependent through fear of not being able to support themselves. If CPP was used in some cases as a supplemental income for those who wanted to work as much time as was allowable for their health conditions, the system could be more effective and the wellbeing of those workers could increase.[518]

Yukon Council on disABILITY

Employment Insurance Special Benefits[519]

i. EI Sickness Benefits

Some witnesses told the Committee that they would like to see an extension of EI sickness benefits to bridge the gap between the end of employment and the beginning of receipt of CPPD benefits for those who qualify. Others mentioned that for some people with episodic disabilities (e.g., multiple sclerosis, mental illness, arthritis and others) who may not need to access CPPD but may need a longer time to recover and return to work, the current 15 weeks of income replacement for people who are unable to work due to short-term illness, injury or quarantine provided under EI sickness benefits is often not enough. The income replacement rate is 55% of average insured earnings up to a maximum of $457 per week (2010) and the income is taxable. Those with a low income may also be entitled to the Family Supplement.[520] In 2007-2008, there were 319,120 claims for EI sickness benefits, representing 7.7% of all EI claims, at a cost of $954.9 million. While the average duration of benefits was 9.5 weeks, 31.5% of claimants exhausted their benefits.[521]

Frankly, they don't work very well for mental illness. Let me just give you an illustration, and you will know this better than I do. I think it's 15 weeks. When you get to the end of 15 weeks, you lose the EI sickness benefits. Fifty per cent of the people who are still sick at the end of that fifteenth week are sick with a mental illness. In other words, half of the people who get to the end and still need help but don't have help because they have run out of sickness benefits are there with a mental illness.[522]

Hon. Michael Kirby, Mental Health Commission of Canada

Some witnesses asked that the duration of EI sickness benefits be gradually increased up to 50 weeks. The Committee also made a similar recommendation in its 2006 report on employment insurance, calling on the government to “study the possibility of extending sickness benefits by 35 weeks for those who suffer from a prolonged and serious illness”.[523] Given that almost one-third of claimants exhaust their benefits and may still need financial support to fully recover before they can return to work, most members of the Committee agree that it is now time to extend the duration of EI sickness benefits up to 50 weeks.

Recommendation 4.2.3

The Committee recommends that the federal government extend EI sickness benefits up to 50 weeks for those who suffer from a prolonged and serious illness.

Other witnesses told the Committee that there should be more flexibility within the EI regulations to allow people who have episodic disabilities to work part-time and receive partial benefits.

Allowing people who have an unpredictable and episodic disease – diseases such as MS, lupus, some forms of mental illness, cancer, arthritis and Hepatitis C and HIV – to have the option of working part time while receiving partial Employment Insurance sickness benefits, encourages them to stay in the work force. It also encourages employers to think of them as valuable employees, not as people who are ill and unreliable. Canada faces labour shortages in many parts of the country; it makes good economic sense to keep experienced workers as long as possible.[524]

Multiple Sclerosis Society of Canada

ii. EI compassionate care benefits

Another factor too often overlooked is the financial burden endured by families, friends and others who care for people who are sick or those who have episodic disabilities. Currently, Canadians, mostly women, who temporarily cannot work because they need to provide care or support to a family member who is gravely ill and at risk of dying can claim up to six weeks of EI compassionate care benefits after a two-week waiting period. Witnesses have suggested that the eligibility criteria to qualify for compassionate care benefits should be reviewed and the program improved to extend benefits to people who occasionally have to care for people with episodic illnesses or other serious illnesses but who are not in need of end-of-life care.

Introduced in 2004, the existing program provided $9.5 million in benefits in 2007-2008. The uptake was lower than expected as the government had planned to spend $12 million that year. Almost 60% of those who received compassionate care benefits in 2007-2008 exhausted their six weeks of entitlement and a third went on to claim another type of benefit such as EI regular or sickness benefits.[525] Given those facts, the Committee believes that the duration of compassionate care benefits must be extended and that the eligibility criteria must be broadened.

Recommendation 4.2.4

The Committee recommends that the federal government increase the duration of the EI compassionate care benefit from six to 12 weeks and provide access in cases of serious illnesses other than palliative care cases such as episodic disabilities.

Registered Disability Savings Plan

Another new and very well-received program in the disability community is the Registered Disability Savings Plan (RDSP), which helps parents of children with disabilities and adults with severe disabilities save today to offset the costs of disability later in life. All Canadian residents under age 60 who are eligible to receive the DTC can benefit from this plan. Under the RDSP, the federal government provides a matching Canada Disability Savings Grant (CDSG) of up to $3,500 per year based on eligible contributions made to an RDSP and a beneficiary’s family income, with a lifetime limit of $70,000. The government also assists low- and modest-income families and individuals to save in an RDSP by offering them a Canada Disability Savings Bond (CDSB) of up to $1,000 each year ($20,000 lifetime limit), even if no personal contribution is made. Earnings can accumulate tax-free in an RDSP until money is withdrawn from the account.[526]

In 2008-2009, Canadians applied for or opened more than 12,500 RDSPs.[527] The program was allocated $115 million under planned spending for 2008-2009. This amount was set to increase to $165 million in 2009-2010 and to $210 million in 2010-2011. However, in 2009-2010, only $3.3 million is expected to be spent on CDSG payments and only $1.9 million is expected to be spent on CDSB payments.[528] It is clear that the uptake of this plan has been much lower than anticipated. The Committee knows that a national public outreach program to raise awareness about the RDSP was undertaken by HRSDC and we applaud the efforts made to date. We also want to underscore the need to continue to raise awareness as this plan can offer important benefits to low-income people with disabilities who are in need of financial assistance. Some witnesses expressed concerns that RDSP assets would not be fully exempted for the purposes of determining eligibility for provincial financial assistance programs and that income from RDSPs would be clawed back from financial assistance payments. However, we have learned that all provinces have already announced a partial or full exemption of RDSP assets and income.[529] Other witnesses also suggested that the RDSP contribution limit and the age limit for participation in the program be increased.

Yes, a couple of things that we recommended in our brief were that there be a consideration of the overall lifetime limit that is currently placed on the RDSP, which is $200,000. If you look at a person who gets a spinal cord injury at an early age, it would probably take a minimum of $2 million over a lifetime in incremental expenditures to support that person with their well-being. So the $200,000 is really a pittance when it comes to that consideration. As well, the age limit is currently 49. We know through our statistics that there is an increasing incidence of spinal cord injury among people who are in the ageing population, so the age limit is a real problem that way.[530]

Bruce Drewett, Canadian Paraplegic Association

Basic Income Program[531]

The Committee was reminded that provincial/territorial social assistance programs are often not suited to the diverse needs of those living with disabilities. People who cannot be expected to earn an income from employment frequently receive insufficient support, while those who could earn an income may be discouraged from doing so by the potential loss of benefits offered through social assistance programs, such as coverage of medical and disability-related costs.[532] What Canadians with disabilities need are more effective income security programs and an independent disability support system in Canada.

Too often we see that Canadians with disabilities are exiled to inadequate, stigmatizing, and ineffective systems of income support. Social assistance programs were not designed to provide the long term flexible supports needed by people with disabilities. They were built as a system of last resort, yet they have become a system of first resort for Canadians with intellectual disabilities.

Our existing systems also have built-in disincentives, where we unfortunately find that people are financially better off on welfare than getting off welfare. There are significant challenges. Eligibility for needed disability supports goes down as your income goes up, so people have to choose between being able to earn an income and having the supports they need to be able to gain that income and keep that job.

Further, we know that income derived from employment is often clawed back in many jurisdictions, again forcing people to rely on income security programs to gain access to those disability supports. We need broad system reform to address these disincentives and build a more appropriate support system of income and disability supports.[533]

Anna Macquarrie, Canadian Association for Community Living

Some witnesses recommended the creation of a federal basic income program that would initially apply only to persons with severe and prolonged disabilities, including those with a mental illness, who cannot reasonably be expected to earn adequate income from employment. Under a federal basic income program, these individuals would no longer be clients of provincial and territorial social assistance programs, eliminating the stigma associated with the receipt of assistance under those programs and creating savings that would be reinvested in a better system of disability supports. It has been suggested that a federal basic income program for people with disabilities should be delivered through the tax system and provide an income equivalent in adequacy to that provided to low-income seniors through OAS and GIS programs. A federal basic income program would have to be created in cooperation with provincial and territorial governments and include Federal-Provincial-Territorial negotiated agreements to ensure that resulting social assistance savings would be reinvested in the creation of an income-tested disability supports program. The latter program would be delivered by the provinces and territories, and would provide disability supports and services to all those in need, whether they are recipients of social assistance or basic income programs or living independently of these programs.

Welfare is a program of last resort. It never was intended to provide a guaranteed income for so many Canadians. One of our proposals has to do with the possibility of taking people who have a disability off welfare to create a new basic income program that would be supported by the federal government. It would be similar to the kinds of configurations that we have for seniors, particularly the guaranteed income supplement, which is an income-tested program. The combined Old Age Security and Guaranteed Income Supplement provide about $13,700 a year, so we're looking at that configuration as a model for how we might reform income security.

Now, if we did that, if in fact we removed people from welfare and had a new income security program, there would be considerable savings to the provinces and territories. One of our proposals is that under a negotiated agreement with the federal government there would be a reinvestment in disability supports. These include technical aids and equipment and personal supports like home care and homemakers' services. This is really a significant area that we've overlooked, not just for the 16% of Canadians considered to be disabled from a formal definition perspective, but also from the viewpoint that we have an aging population in Canada, and we have to pay attention to that issue.[534]

Sherri Torjman, Caledon Institute of Social Policy

In the medium and longer term, CMHA [Canadian Mental Health Association] agrees with the Caledon Institute of Social Policy that the federal government should initiate and operate a basic income program for persons with disabilities, including persons diagnosed with mental illness. This initiative would remove persons with disabilities from provincial social assistance programs. It would provide a fairer, more uniform basic income, similar to the OAS benefit and the guaranteed income supplement for seniors, with benefits sufficient to decrease the prevalence and depth of poverty for persons with disabilities.[535]

Ruth-Anne Graig, Canadian Mental Health Association

The Committee recognizes that the creation of a basic income program would be challenging not only because it would require the establishment of a governance and accountability framework that is acceptable to provincial and territorial governments, but also because it would entail a delicate balancing act between providing long-term income security to persons with disabilities and ensuring that incentives to work are not weakened by targeting those with severe limitation to work. It is clear that in order to provide a decent basic income to working-age people disabilities, the program would have to be income-tested, and the eligibility would have to be limited to those with severe and prolonged disabilities who cannot be anticipated to earn a living through employment. Many members of the Committee also recognize that similar challenges have been overcome in the past and that while it may take a long time to negotiate Federal-Provincial-Territorial agreements given the complexity of the matter, the creation of a basic income program for persons with severe disabilities holds the promise of removing the stigma attached to social assistance recipients, reducing poverty, increasing access to disability-related supports and promoting social justice, respect and dignity for all Canadians.

Recommendation 4.2.5

The Committee recommends that the federal government create a federal basic income program for persons with disabilities and support a disability-related supports program to be delivered by the provinces and territories.

c. Other Transfers and Tax measures

In addition to benefits offered through the CPP and EI programs, the federal government offers other federal tax and transfer benefits that offset some of the costs related to a disability. In this section, we will share what we have learned with regard to selected federal tax measures available to persons with severe disabilities and their families. Disability pensions for veterans and disability awards and allowances offered to veterans under the New Veterans Charter,[536] as well as disability supports for First Nation and Inuit peoples and members of the Armed Forces have not been part of our study.

Disability Tax Credit

The disability-related federal tax measure that received the most attention over the course of our study is the DTC, also known as the “disability amount.” The DTC aims to promote fairness among those who pay income tax and reduce the extra costs incurred by people with disabilities as a result of their illness or condition. Persons with severe and prolonged impairment of physical or mental functions, 18 years of age and older, can claim $7,196 on their 2009 income tax return, which is equivalent to federal tax savings of $1079. A claimant must submit a form detailing the nature of the disability or impairment, certified by a qualified practitioner, to receive this tax credit. If an individual does not have sufficient taxable income, the DTC can be transferred to supporting family members (e.g., spouse, common-law partner or another supporting person) to reduce their taxes. Individuals under age 18 at the end of the year may also claim a supplement, an additional amount of up to $4,198 in 2009.[537] It is projected that $395 million in tax relief will be provided under the DTC in 2008-2009.[538]

Because the DTC is a non-refundable tax credit, it benefits only individuals and family members with taxable income. Over the course of our hearings, witnesses told the Committee that many people with disabilities experience significantly higher levels of low income than average Canadians and do not have a taxable income. These vulnerable individuals still have additional expenditures related to their disability. For many years, the disability community has asked that the DTC be made a refundable tax credit, and witnesses reiterated this call in their testimony on poverty reduction measures for people with disabilities.

Tax appears to have become the mechanism for addressing social policy in this country. It is a blunt tool but as a first step to addressing poverty CCD [Council of Canadians with Disabilities] recommends that the Disability Tax Credit (DTC) be made refundable for low income Canadians with disabilities and retained as a credit for those with higher incomes.[539]

Council of Canadians with Disabilities

Our third recommendation really has to do significantly with those people with MS for whom the disease has been most disabling, and who cannot work. It really is a simple one: make the disability tax credit a refundable benefit.

Having a disability automatically means that you have expenses that an able-bodied person avoids. These expenses are very significant. For many people with MS [multiple sclerosis], fatigue will be an invisible characteristic of the early course of the disease. That alone can make walking even short distances impossible. Riding a bus or using public transit is made difficult. A car becomes a necessity. For people who use a wheelchair, an adapted van is a necessity.

We believe that making the disability tax credit a refundable benefit would bring money into the hands of people with a disability who do not have enough income against which to apply the credit.[540]

Yves Savoie, Multiple Sclerosis Society of Canada

The first and immediate step that the federal government could take in moving toward this type of comprehensive reform would be to make refundable the current disability tax credit that helps offset the additional (sometimes referred to as ‘hidden’) costs of disability. Currently (2008 tax year) the disability tax credit provides federal tax savings of a maximum $1,053. This shift would provide assistance to the thousands of persons with disabilities with incomes too low to benefit from the current income tax provision.[541]

Caledon Institute of Social Policy

Most members of the Committee believe that a refundable DTC would be a step in the right direction toward alleviating poverty among people with disabilities. A number of concerns would have to be addressed, including ensuring that the amount of the refundable tax credit not be clawed back from other social assistance payments. The Committee believes that this can be done, as we have recently seen the provinces and territories partially or fully exempt the income and assets of RDSPs when determining social assistance eligibility and payment amounts.

Recommendation 4.2.6

As a first step in addressing the needs of the poorest of Canadians with severe disabilities, the Committee recommends that the federal government amend the Income Tax Act to make the Disability Tax Credit a refundable credit and ensure that new federal benefits for persons with disabilities are not clawed back from those receiving social assistance payments.

Child Disability Benefit

Research has shown that many families of children with severe disabilities struggle financially and that their financial woes are likely linked to the extra costs associated with a child’s disability. In 2005, “[a]pproximately 30.3% of families of children with a severe to very severe disability reported financial difficulties; a rate more than three times higher than families of children with mild to moderate disabilities at 8.6%.”[542] The CDB, a supplement to the CCTB,[543] is a tax-free benefit that is meant to offset disability-related costs by providing parents of children with severe disabilities up to $2,455 annually ($204.58 monthly) per child depending on their adjusted family net income. Parents who apply for the CDB must obtain proof that their child is eligible for the DTC in order to qualify. In 2007-2008, benefits totalled $143.5 million and it is estimated that the federal government will spend approximately $170 million on the CDB in 2008-2009.[544]

The Committee believes in the importance of supporting families of children with severe and prolonged disabilities. Given that all families who receive the CDB also receive the CCTB, it is our hope that an increase in the latter, one of the main recommendations of this report, will reduce some of the financial strain they experience.

Other Tax Measures

Other important tax measures for people with disabilities are the Medical Expense Tax Credit (METC) and Refundable Medical Expense Supplement, the Disability Supports Deduction, the Caregiver Credit and the Infirm Dependant Credit which together recognize various disability-related expenses. The METC is universally available to all Canadian taxpayers and not targeted specifically to people with disabilities. It provides tax relief to make up for some of the costs of above-average medical expenses including some disability-related expenses. For taxpayers to claim the METC, they must have medical expenses in excess of the lesser of $2,011 (2009) or 3% of their net income. Medical expenses can include those of a spouse or common-law partner, a child under the age of 18 and, under certain conditions, also those of eligible dependants. The Refundable Medical Expense Supplement can provide up to $1,067 (2009) to low-income working Canadians with high medical expenses. The Disability Supports Deduction also allows working people with disabilities to deduct some of the extra costs incurred in order to work, study or conduct research for which they received a grant. Taxpayers can also claim a caregiver amount up to $4,198 (2009) for the care of a dependant over the age of 18 living with them who is dependent due to a mental or physical impairment and/or can claim the same amount for infirm dependants age 18 or older that they support.

While the tax system has its limitations in providing financial assistance to low-income people with disabilities, it remains an important and effective instrument for several reasons. It does not require the establishment of a new program to rapidly increase benefits; it can be a Federal-Provincial-Territorial mechanism (e.g., NCB); and it is less intrusive and stigmatising than other income security programs (e.g., social assistance). In addition, the tax system can be a flexible and targeted instrument as need be.

d. Skills Development and Employment Measures

The Committee is well aware of the importance of employment-oriented social policies and their impact on lowering poverty rates among working-age Canadians. We also understand that not every working-age person with a disability can be employed or earn enough to sustain themselves. However, we do believe that every person with a disability should have the opportunity to use their skills to their fullest capacity and should be able to access the assistance they need to prepare for, obtain and maintain employment. The Committee looked at the role of the federal government with respect to increasing employability among persons with disabilities and made a number of recommendations to promote an inclusive labour market in our 2008 report entitled Employability in Canada: Preparing for the Future.[545] Some of these recommendations have yet to be implemented and we reiterate their importance.

Opportunities Fund

HRSDC is responsible for the Opportunities Fund (OF), a contribution program launched in 1997 with an annual budget of $30 million per year to help people with disabilities prepare for and obtain employment or self-employment, thereby increasing their financial independence. It has assisted over 45,000 people with disabilities since its inception. The Committee recommended in its 2008 report an increase in funding to this program, as well as an expansion of its terms and conditions, to support effective long-term interventions and skills development opportunities. Based on witnesses’ testimony, as well as a recent evaluation of the OF that found the program to be effective for participants and employers,[546] an increase in funding is still justifiable today.

Through the Opportunities Fund, National Network for Mental Health has developed supported entrepreneurship programs, three of which still exist today in Calgary, St. Catharines, and Nova Scotia. People in this program are assisted in developing small businesses that range from supplementing income support programs to achieving full-fledged financial independence.

The newest program, BUILT Network, is a supported employment program that was started by Dave Gallson and National Network for Mental Health. Its objective is to provide customer service skills and computer skills to enable persons in the community to gain employment in customer service, administration, order desks, or call centres. The primary mandate is to empower the mental health consumer through skill development and employment. This entails identifying and removing perceived and real barriers to the workplace. This is achieved by bringing in local employers and having them participate through guest presentations in the classroom, submissions in course content, and the hiring of graduates of the program.

National Network for Mental Health is proud to announce that the BUILT Network project has been recognized nationally for excellence in learning by the Canadian Council of Learning, June 12, 2007. To date, BUILT has served about a thousand people. Of these, 750 have returned to work, and a further hundred have gone back to school.[547]

Carmela Hutchison, National Network for Mental Health

Given Canada’s difficult economic situation, this is not the time to abandon people with disabilities who need assistance to integrate into the labour market. There will likely be strong competition for jobs as Canada’s economy recovers and people with disabilities who want to work will need to have the labour market skills to compete with their counterparts for those jobs. The OF program has made a difference in the lives of its participants and the government should continue to improve the program and increase funding as necessary to ensure that people who reach out for help get the assistance they deserve.

Recommendation 4.2.7

The Committee recommends that the federal government increase funding for the Opportunities Fund; expand the terms and conditions of this program to support effective long-term interventions and skills development opportunities, especially with respect to essential skills training; and take concrete steps to raise awareness and promote the program to potential clients, employers and service providers.

Multilateral Framework for Labour Market Agreements for Persons with Disabilities

Under the Multilateral Framework for Labour Market Agreements for Persons with Disabilities implemented in 2004, the federal government aims to improve the employment situation of persons with disabilities by contributing 50%, or up to the amount identified in each bilateral labour market agreement, to the costs of provincially designed and delivered programs that address their employability needs. Labour market agreements under this framework have been signed between the Government of Canada and nine provincial governments.[548] Extensions to Labour Market Agreements for Persons with Disabilities were obtained in 2007-2008 and the program is ongoing. In 2008-2009, it was estimated that the federal contribution to participating provinces under these agreements would be $222 million.[549]

Witnesses told the Committee that there should be specific allocations and targets for persons with disabilities in all Labour Market Agreements and Labour Market Development Agreements[550] negotiated with the provinces and territories. The federal government has made an additional investment of $500 million in a Strategic Training and Transition Fund for fiscal years 2009-2010 and 2010-2011, but no dollars were specifically earmarked for persons with disabilities. As well, some witnesses suggested that the Multilateral Framework for Labour Market Agreements for Persons with Disabilities should be extended and its funding increased.

Labour market agreements must include a target for persons with disabilities. However, until we have an appropriate and inclusive way of offering true training and real opportunities for employment, then we suggest that there should be more funding put into the opportunities fund and the multilateral framework agreements.[551]

Marie White, Council of Canadians with Disabilities

Recommendation 4.2.8

The Committee recommends that the federal government include specific allocations and targets for persons with disabilities in Labour Market Agreements and Labour Market Development Agreements.

Other HRSDC programs assist people with disabilities find and maintain employment. For example, the Office of Literacy and Essential Skills funds literacy organizations across Canada which in turn enhance employment opportunities of Canadians who take part in these programs. Access to post-secondary education can also prevent and reduce poverty among persons with disabilities. Financial assistance is offered to students with disabilities through the Canada Student Loans Program, the Canada Study Grants for Persons with Permanent Disabilities and the Canada Study Grant for Services and Equipment for Persons with Permanent Disabilities.[552]

There are also a number of employment-related legislative measures, policies, programs, and practices designed to achieve employment equity for persons with disabilities. The Canadian Human Rights Act (sections 2 and 15) requires the federal government and federally regulated employers to provide workplace accommodation unless doing so would result in undue hardship. The Treasury Board of Canada Secretariat has developed a Policy on the Duty to Accommodate Persons with Disabilities in the Federal Public Service. As well, persons with disabilities are one of the four designated groups identified under the Employment Equity Act. We believe that increasing labour market participation is key to reducing poverty among people with disabilities. The federal government must be a role model for employers across the country and an employer of choice for people with disabilities.

e. Other Initiatives

Enabling Accessibility Fund

The Enabling Accessibility Fund (EAF) was announced in Budget 2007 as a three-year, $45 million initiative to contribute to the cost of improving physical accessibility for persons with disabilities. The EAF provides grants to offset the capital costs of construction and renovation projects that enhance physical accessibility. Eligible projects range from the construction of new facilities to smaller modifications to existing buildings.[553] Some witnesses called for a longer commitment to this program and the inclusion of a similar initiative for transportation. Improving accessibility is essential to improving the living standard of people with disabilities and reducing poverty.

We recommend that the Government of Canada continue to invest in the enabling accessibility fund, through the Office for Disability Issues, to ensure that buildings are accessible for Canadians of all abilities.

Moreover, we recommend that the federal government recognize the significant transportation challenges faced by people with disabilities in communities across Canada and that it develop a transportation support initiative in line with the enabling accessibility program. [554]

Jane Arkell, Active Living Alliance for Canadians with a Disability

The Committee believes that there is value in the EAF and that it is important to invest in removing barriers for persons with disabilities if we are to increase the standard of living of this population. However, some members of the Committee think that, if the EAF is renewed, it should be accompanied by a strengthened accountability mechanism and more transparency in the selection of projects to be funded.

Transportation

Access to transportation is another challenge for many people with disabilities, as well as a growing number of seniors in Canada who have physical limitations. Improving accessibility to transportation is the responsibility of the Canadian Transportation Agency (CTA), a federal agency responsible for ensuring that “undue obstacles to the mobility of persons with disabilities are removed from federally-regulated transportation services and facilities.”[555] To achieve this, the CTA has set up regulations and codes of practice, as well as a complaint mechanism. Advocacy groups for persons with disabilities, including the Council of Canadians with Disabilities (CCD), contend that reliance on voluntary codes of practice makes the CTA powerless to regulate accessible transportation and that these codes are not an appropriate vehicle for eliminating systemic obstacles. The CTA, in response to this criticism, is developing and implementing a comprehensive monitoring and compliance methodology supported by an outreach program “designed to focus on code requirements where service providers will need to comply with standards set out in the codes of practice.”[556]

I'll give you a couple of examples. Right now there are voluntary codes of practice for transportation in this country. They do not work, as per CCD's [Council of Canadians with Disabilities] seven-year battle with VIA, as per its recent win in yet another court around “one person, one fare”. We believe and have said for years that there should be regulations, not voluntary codes.[557]

Marie White, Council of Canadians with Disabilities

The Committee was told that much more needs to be done to remove transportation barriers for people with disabilities and to increase their capacity to go about their daily lives with as much independence as possible. Public transit is often not accessible to travelers with disabilities and not available in rural and northern communities. The cost of transportation may also be a barrier for people with low incomes. The Committee was pleased to learn that some communities have set up programs to facilitate transportation for people with disabilities and those living on low incomes and believes that such projects could serve as examples for similar initiatives elsewhere in the country. Nonetheless, the Committee also believes that the federal government has an important role to play in ensuring that Canadians of all abilities can access appropriate transportation.

I'm involved in the Charlotte County Dial A Ride program, which provides volunteer transportation for seniors, disabled, and needy families in Charlotte County. We have a number of volunteers who give up their time and will transport those people otherwise unable to have transportation in a rural community to medical appointments, to banks to cash their cheques, to grocery shopping, to social events, and to quite a few other things.

We do about a thousand trips a day. It's not something that was developed in Charlotte County. We stole the idea from Nova Scotia. There are about 10 counties there that do it. It was facilitated in our county by dialogues that were put on by the Fundy Community Foundation. They organized a community dialogue with stakeholders involved in programs to assist those in need in our county. At that time, it was the Charlotte County Benevolent Society that I was involved in, which provided support to families of seriously ill children. Through that dialogue about transportation, that problem was solved. [558]

John Castell, Fundy Community Foundation

Recommendation 4.2.9

The Committee recommends that the federal government invest infrastructure funds in accessible and affordable public transportation so as to ensure that all Canadians with or without disabilities, no matter where they live, have access to transportation.

Recommendation 4.2.10

The Committee recommends that the Canadian Transportation Agency meet at least annually with its Accessibility Advisory Committee and that it actively involve the Advisory Committee in the development of its monitoring and compliance methodology.

Housing

The Committee was also told that many people with disabilities find it difficult to obtain adequate, affordable and accessible housing, often a prerequisite to participating in the labour force and taking advantage of other opportunities. Without a place to call home, a place that meets individuals’ needs, it is really difficult to move forward and take advantage of opportunities life has to offer. The Canada Mortgage and Housing Corporation (CMHC) has a number of programs to assist persons with disabilities find appropriate and affordable housing or renovate their current home. The government also provided $110 million to the Mental Health Commission of Canada to support innovative demonstration projects to develop best practices to help Canadians with a mental illness that are experiencing homelessness challenges. Housing-related measures are discussed in Chapter 5 of this report.

Policy and Research

Statistics Canada’s Participation and Activity Limitation Survey (PALS) is a national survey that provides “information about adults and children whose daily activities are limited by a physical, mental, or other health-related condition or problem.”[559] To date, two post-censal surveys were undertaken in 2001 and 2006.

Another thing we need is data. The participation and activity limitation survey, also known as PALS, is a crucial source of data for our community. The future of PALS currently remains in question. It has not yet been renewed for 2011 and beyond. Not only does this data provide us the crucial research and policy information the disability community, our governments, and other civil society organizations need; it also enables Canada to meet its obligations under the UN Convention on the Rights of Persons with Disabilities. We continue to call on the federal government to secure PALS for 2011 and beyond.[560]

Anna Macquarrie, Canadian Association for Community Living

I go back to what my friend said about the PAL survey—is absolutely critical. The PALS information must continue. In fact, the PAL survey needs to be enhanced so that there's more information collected on gender and disability together.[561]

Bonnie Brayton, DisAbled Women's Network of Canada

The importance of the PALS for informing the development of federal disability initiatives and monitoring their progress cannot be understated. The value of the survey is made clear in the following excerpt from the 2008 Federal Disability Report:

The 2006 PALS is the centrepiece of the Government of Canada’s strategy for gathering information on disabilities. At the federal level, PALS is a primary source of data on disability for policy and program development, assessment and planning. For example, PALS data have been used extensively by Finance Canada in its review of disability tax measures, and by HRSDC to provide background for the Multilateral Framework for Labour Market Agreements for Persons with Disabilities. It also provides information required by the Employment Equity program in order to meet its regulatory requirements.

Provincial, territorial and municipal governments, along with service providers and the disability community, have acknowledged PALS and look to the Government of Canada to continue to provide leadership and resources for developing this knowledge. PALS has met these needs by providing data that is used intensively by Government of Canada departments, provinces, territories, municipalities, service providers and disability organizations to develop evidence-based policies, programs and positions. PALS have also garnered the interest of members of the disability community. To respond to the needs of the disability community, Statistics Canada has included, in its dissemination plan, the development of fact sheets on specific types of disabilities. At the international level, PALS is recognized as providing the most comprehensive picture of people with disabilities in Canada, and has provided input to other nations in their development process for surveys on disabilities.[562]

The PALS is an invaluable tool for policy-making, yet the Committee was told by some witnesses that HRSDC has not committed funding for the 2011 PALS post-censal survey and that it will be replaced by a new data collection tool. The Hon. Diane Finley, HRSDC Minister, promised the disability community that it would be consulted in the development of the data collection model. HRSDC held the first meeting of the Technical Advisory Group on July 22, 2010 and it was attended by representatives of the Council of Canadians with Disabilities, other disability community researchers and federal government officials.[563] The Committee will continue to monitor the situation as it strongly believes that data collection on participation and activity limitation of the disability community in Canada is essential if we are to develop successful services and programs that will meet the needs of Canadians with disabilities. This data also enable governments and other service providers, as well as the disability community, to develop knowledge-based policies on disability issues and monitor progress towards the goal of making Canada a fully inclusive society.

Recommendation 4.2.11

The Committee recommends that the federal government revise its decision not to fund the Participation and Activity Limitation Survey in 2011 and commit to providing financial support for this valuable policy and research tool on an ongoing basis.

4.3 Senior Citizens

What are described as pillars one and two of the Canadian retirement systems, OAS, CPP, and GIS, together have been credited with the dramatic decline in poverty rates among seniors in the past 20 years. This is due in large part to the maturing of the CPP and the availability of GIS. [564]

Susan Eng, Canadian Association of Retired Persons

The federal government contributes to seniors’ income in a variety of ways. The two main components of the public retirement system are Old Age Security (OAS) and the Canada Pension Plan (CPP), which issued $33.9 billion and $28.6 billion, respectively, in net payments in 2008.[565]

 a. Old Age Security

The OAS program is funded directly from the government’s general tax revenues. It consists of three components: the basic OAS pension, the Guaranteed Income Supplement (GIS) and the Allowance. Table 4.3.1 shows the maximum monthly benefit for all three components of the OAS as of January 2010, and the maximum annual income that a person can have and still be eligible for benefits.

Table 4.3.1 – Benefit Rates, OAS, 2010[566]

The maximum basic pension is usually available to all Canadians aged 65 or older who have lived in Canada for at least 40 years after turning 18. Individuals who have lived in Canada for 10 to 40 years are eligible for partial benefits. Special provisions apply to immigrants from countries that have a social security agreement with Canada. Basic OAS benefits are taxable. In addition, pensioners with a net income before adjustments of more than $66,733 (in 2010) must reimburse 15% of the difference between their income and this amount, up to the total amount of benefits. Benefits are adjusted quarterly to reflect increases in the Consumer Price Index. They can also be increased on a discretionary basis. In 2005, for example, GIS benefits were increased by $36 per month for single persons and by $58 per month for couples.[567] This was the first increase since 1984.

Unlike the basic OAS benefits, GIS benefits and the Allowance are not taxable. GIS benefits are available to low-income seniors. The maximum benefit is reduced by $1 for each $2 of income earned in the case of single seniors, and by $1 for each $4 of combined earnings for married persons or the common-law partners of OAS recipients. A single senior whose income is over $15,672 is not eligible for the GIS. Income calculations do not include OAS benefits, CPP and QPP (Quebec Pension Plan) death benefits,[568] and social assistance benefits. The first $3,500 of employment income is also exempt.

Lastly, the Allowance is paid to low-income seniors aged 60 to 64 who have lived in Canada for at least 10 years after turning 18 and who are the spouse of a benefit recipient or their survivor. In the case of survivors, the benefit is reduced by $3 for every $4 of income earned by the recipient or of combined income for the spouse’s allowance.

In June 2009, some 4.6 million Canadians aged 65 and older, approximately 98% of that total age group, were receiving OAS or GIS benefits, a similar proportion among men and women. Some 1.6 million of these seniors were receiving the GIS (29% of men and 63% of women aged 65 and older). The Allowance and the Allowance for the Survivor were paid to slightly less than 100,000 persons aged 60 to 64 (mostly women). In 2008, the average monthly benefit was $482 for the OAS, $391 for the GIS and $474 for the Allowance.[569] In 2007, combined OAS benefits represented about 18% of the total income of male seniors but 28% of that of female seniors.[570]

b. Canada Pension Plan

The CPP is a public retirement plan funded through equal contributions by employers and employees (self-employed persons pay both the employee and employer contributions), and it is mandatory as of age 18.[571] In 2010, the combined contribution rate is 9.9% of earnings between the minimum of $3,500, which remains constant, and $47,200, the maximum amount of pensionable earnings, which is adjusted annually based on growth in the average wage in Canada. The CPP features three types of benefits: retirement benefits (72% of total CPP benefits); disability benefits (13% of total CPP benefits); and survivor’s and death benefits (15%). The disability benefit is composed of a fixed-rate portion and an amount equal to 75% of the earned retirement pension. For a recipient aged 65 or older, the survivor’s benefit is equal to 60% of the retirement pension granted to a deceased contributor.

Retirement benefits are equivalent to 25% of pensionable earnings during the period between age 18 and retirement age (60 to 70). Months of low earnings are excluded from the calculation (up to 15% of the period). Under the child-rearing provision, if your earnings stopped or were reduced because you were raising children under the age of seven, you can ask for that period of time to be excluded from your pension calculation. If your income was equal to or greater than the maximum annual insurable earnings for at least 85% of the time that you were between the ages of 18 and 65, you will receive a maximum monthly benefit of $908.75 at age 65. You can begin receiving benefits at age 60, with an actuarial adjustment of 0.5% per month or 6% annually until age 65, which means that if you start receiving CPP benefits at age 60, you face a 30% penalty. Similarly, if you start receiving benefits at age 70 (the maximum allowable age), you will be eligible for benefits that are 30% higher. In 2003, approximately two-thirds of retirees started to receive benefits before age 65.[572] Benefits are taxable and are adjusted annually to reflect increases in the Consumer Price Index.

In May 2009, the federal, provincial and territorial finance ministers recommended several changes to the CPP.[573] Bill C-51, passed in December 2009, brought some of these recommendations to fruition. For example, the percentage of low earnings months that can be excluded from the benefit calculation will be increased from 15% to 16% in 2012 and to 17% in 2014. As of January 2011, the minister can also change the actuarial adjustment factors by regulation. The related recommendation suggested a penalty of 36% on persons who start receiving CPP benefits at age 60 (or 0.6% per month before the age of 65), and an enhancement of 42% for those who start receiving benefits at age 70 (or 0.7% per month). There have been no official changes to the rates so far.

In 2007, 96% of men and 86% of women over the age of 65 received CPP or QPP benefits. These benefits represented one-fifth of their income in both cases. Average benefits were $7,000 for male recipients and $5,500 for female recipients.[574]

c. Other Federal Contributions

In addition to the OAS and CPP, the federal government contributes to seniors’ income by helping them prepare for retirement through registered retirement savings plans (RRSPs) and registered pension plans (RPPs). In both cases, contributions are tax deductible up to a certain level or percentage of income, but the retirement income is taxable. RRSPs and RPPs target primarily people in a middle- or high-income bracket and are not very effective in helping low-income people prepare for retirement. In 2005, 48% of families with an after-tax family income of $36,500 or less had an RRSP or RPP, compared with 89% of families with an income above $85,000. The difference in the median value of these plans was even more striking: $16,300 for the first group and $224,100 for the second.[575]

Lastly, persons aged 65 and older can receive a non-refundable tax credit of $6,408 (2009) if their net income is $32,312 or less. This credit decreases by 15 cents for each additional dollar of income up to a maximum income of $75,032. The tax credit is indexed annually and received an additional increase of $1,000 in 2009. There is another non-refundable tax credit of $2,000 for pension income (income from an RRSP or RPP). However, these tax credits have no impact on low-income seniors who do not pay taxes.

d. Proposals for Reducing Poverty among Seniors

As stated in Chapter 1, over the past few decades there has been a drastic decrease in the percentage of seniors whose income is below the after-tax LICOs, as measured by Statistics Canada. However, seniors who live alone are still more likely than other seniors and the rest of the Canadian population to be below these thresholds.

Several witnesses told the Committee that income support programs have done a great deal to reduce low-income rates among seniors.

The declining low-income rate over the past 25 years for Canada's senior population has been a significant success story. The low-income rate was 6.1% in 2005 for seniors, down markedly from 21.3% in 1980. This decline is the result of the maturation of the CPP, the enhancement of the OAS and GIS, and the increase in private savings.[576]

Frank Fedyk, Department of Human Resources and Social Development

The maturation of the CPP refers to the fact that this plan was established in 1966 and the percentage of seniors able to receive full benefits has increased over the years. Improvements in seniors’ financial situation can also be attributed to the increased percentage of seniors receiving retirement income from RPPs in the 1980s and 1990s.[577]

Witnesses suggested several ways to increase seniors’ income, particularly for persons living alone (mostly women) whose income is below Statistics Canada’s LICOs. Some proposals involved increasing OAS or GIS benefits in order to bring public pension benefits closer to the LICOs, or removing CPP benefits from the income calculation for the GIS.

We could also look at the level of OAS and GIS combined—our basic guaranteed income for seniors—because for a single individual, the maximum amount available from those two programs is still below the after-tax LICO. Changes here could help those senior women on their own who have such high rates of low income.[578]

Monica Townson, as an individual

So in the area of government income supports and public pension benefits, we would be recommending that the federal government increase the levels of OAS and GIS substantially to bring the guaranteed income to be at least LICO-appropriate for the urban centres or the places in which they live.[579]

Susan Eng, Canadian Association of Retired Persons

The CPP payments diminish the GIS component by 50%. So it may be that we should not be looking at reforming the CPP itself. Instead, we should be looking at how the CPP reduces other income forms, especially for people who have needs.[580]

John Stapleton, Toronto City Summit Alliance

The GIS is an ideal means of reducing poverty among seniors because it targets those with a low income, particularly seniors living alone. In 2007, seniors living alone represented 28% of all seniors, but 60% of GIS recipients and 82% of seniors living below the LICOs. A senior living alone with no income other than the maximum OAS and GIS benefits would receive combined benefits of about $14,033 (January 2010 rates), which is below the LICOs for 2008 (the latest available) for a person living alone in an urban centre with a population of 30,000 or more.[581] By comparison, a couple aged 65 or over in the same situation would receive combined benefits of $22,749, which is above the 2008 LICOs for all regions.

In the case of employment income, the GIS features a basic exemption that is not indexed to the cost of living. Furthermore, CPP income reduces GIS benefits, which creates a disincentive among some senior citizens to work further.[582] Excluding CPP benefits from the GIS income calculation would reduce this disincentive.

Recommendation 4.3.1

The Committee recommends that the federal government make changes to the Guaranteed Income Supplement (GIS), in particular by increasing benefits (especially those to persons living alone), increasing or indexing the basic exemption for employment income, and excluding Canada Pension Plan benefits from the income calculation for the GIS, and that the federal government sytematically verify eligibility of pensioners to the GIS and allow an individual to apply for a pension and/or the GIS by adding a question to that effect in the tax return.

Some witnesses raised the idea of making the age credit refundable rather than non-refundable. This step would have the greatest impact on people who pay no taxes. Recommendation 4.3.1 already targets GIS benefits, affecting mainly people who pay little or no tax.

The most obvious program to further reduce poverty among seniors is the guaranteed income supplement. This received a few improvements a couple of years ago—the first ones in a generation. If we want to make further progress with poverty for seniors, we could make further increases in this program. Another possibility is to take the age credit, which is a non-refundable credit, and make it a refundable credit. Then it would serve seniors who have income so low that they're below the taxpaying threshold.[583]

Ken Battle, Caledon Institute of Social Policy

Other witnesses spoke of the lack of awareness of the GIS. For example, some people who are eligible for the GIS do not apply because they are not aware of it or do not want it.

One of the studies we came across was a Statistics Canada report about the guaranteed income supplement and the problems people are experiencing with that. About 300,000 seniors across the country may be losing about $300 million every year because they are not filing. We also found the challenges of financial literacy are big for the whole country, but particularly so for low-income people. We found HRSDC, in one of their outreach evaluation reports, reporting that it seems some marginalized people are losing out on their entitlements. They don't apply for them.[584]

Kofi Hadjor, Green Pastures Society

 It is worth noting that the percentage of eligible seniors who do not receive the GIS decreased to 10% from 13% between 2000 and 2006.[585] However, there are still approximately 150,000 eligible seniors who do not receive the GIS. Several years ago, Human Resources and Skills Development Canada introduced measures to encourage GIS take-up, such as eliminating the need to reapply for benefits. Recipients are renewed when they file their income tax return. An awareness campaign was launched in 2002 aimed at the most vulnerable seniors or those who do not file tax returns. The Committee believes that an ongoing effort must be made to reduce the number of eligible non-recipients as they are in particular need of GIS benefits.

 Specific witnesses also identified the CPP as a possible means of increasing seniors’ income.

The Canada-Quebec Pension Plan is designed to provide some measure of dignity to Canadians as they age. It is a tremendous social program success story.…However, it only provides for an earning replacement rate of 25% of earnings up to the average industrial wage. As of 2009, this provided a maximum monthly payment of $908.75 for a 65-year-old who had maximum workforce participation with maximum earnings. In reality, the average monthly benefit payable is only $501.82, which reflects the number of part-time workers and workers who have taken leaves of absence from the paid employment market due to pregnancy leave, parental leave, and compassionate care leave, for example. This disproportionately affects women workers.[586]

Betty Jean Sutherland, Canadian Union of Public Employees – Nova Scotia

One of the disadvantages is that for women who drop out of the labour force for caregiving reasons other than for children—for example, in middle age, to take care of a senior member of the household, or to take care of somebody else—it doesn't have the same dropout provisions as child care for a mother does.[587]

Glenn Drover, Canadian Association of Social Workers

The Canada Pension Plan is not sufficient. It was designed to replace 25% of the average industrial wage. Today, it ought to represent 50% of the average industrial salary. CPP contributions should be gradually increased.…We recommend that the Canada Pension Plan be gradually increased until it reaches 50% of the average industrial salary.[588]

Auréa Cormier, Common Front for Social Justice of New Brunswick

Although seniors who have never been employed do not receive the CPP (approximately 14% of women did not receive CPP or QPP benefits in 2007), many low-income workers or workers who have experienced several periods of unemployment would see an improvement in their retirement income following an increase in the CPP replacement rate. New benefits would have to be phased in so that the contributions of current workers, which would finance this increase, do not unnecessarily pay for increased benefits to current retirees or persons retiring in the near future.

Recommendation 4.3.2

The Committee recommends that the federal government increase the Canada Pension Plan replacement rate and exclude from the benefit calculation the time spent caring for a gravelly ill person, in the same way that time spent caring for a child under the age of seven is currently excluded.

4.4 Poverty among Aboriginal People

The federal government must act in a comprehensive and concerted manner to improve the socio-economic well-being of First Nation citizens, as First Nations poverty continues to carry immense risks to individuals, families, communities, and nations, including poor health, the loss of languages, and other harmful consequences. It should be noted also that First Nations poverty poses significant risks to the social and economic future of Canada, particularly in Western and Northern parts of the country.[589]

Assembly of First Nations

a. Background

As discussed in Chapter one of this report, Canada’s Aboriginal people face important social and economic challenges. The overall prevalence of low income is significantly greater among Aboriginal people than among the non-Aboriginal population. Responsibility for the Inuit and on-reserve registered (status) Indian (First Nations) population rests with the federal government by virtue of Subsection 91(24) of the Constitution Act, 1867. The responsibility of the federal government toward the Métis people is not as clear. The Supreme Court of Canada has not yet determined whether the Métis are included within the meaning of “Indians” under Subsection 91(24).[590] First Nations and Inuit populations are thus eligible for a range of federal programs and services delivered by a variety of federal government departments and agencies. Métis people are eligible only to some of these programs. According to the Aboriginal Horizontal Framework, developed by the Treasury Board Secretariat in 2004–2005, 34 federal departments, agencies and Crown corporations provided 360 programs and services targeted to Aboriginal people that year for an estimated cost of $8 billion annually.[591] In 2010-2011, Indian and Northern Affairs Canada (INAC)’s planned spending alone totals $7.3 billion.

According to the 2006 Census, 3.8% of Canada’s total population, over 1 million people, identified as Aboriginal (First Nations, Métis or Inuit) that year. This number is certainly much higher today as the Aboriginal population is growing at a faster rate than the non-Aboriginal population and is a particularly young population, with a median age of only 27 years compared to 40 years for non-Aboriginal people in 2006. It is also an increasingly urban population as it is estimated that over half of Aboriginal people (54%) lived in urban centres that year.[592] The proportion of Aboriginal people was higher in provinces and territories that are more rural and northern: in Nunavut (85%), the Northwest Territories (50%), Yukon (25%), Manitoba (15%) and Saskatchewan (15%). In other provinces, these proportions were around the Canadian average of 4%.[593]

Studies clearly show that the incidence of low income among Aboriginal people is much higher than among the non-Aboriginal population. The 2006 Census found that 18.7% of Aboriginal people living in economic families and 42.8% of unattached Aboriginal people experienced low income, compared to 8.4% and 28% among the non-Aboriginal population. Aboriginal women were at greater risk of experiencing low income than Aboriginal men, with low-income rates as high as 45.6% among those who were unattached. In addition to income levels, other indicators of well-being reveal that Aboriginal women are particularly at risk of violence and often face barriers accessing the justice system.[594] Aboriginal children also had low-income rates more than twice as high as their non-Aboriginal counterparts.[595] Witnesses were greatly concerned by the extent of poverty among the Aboriginal population and its subgroups and stressed that this situation necessitates specific immediate interventions.

Twenty-three per cent of our population is [A]boriginal, compared to 3.3% for Canada. The legacy of physical, sexual, and emotional abuse of aboriginal women as well as cultural alienation and lack of respect are greater in the north. Consequently, rates of spousal abuse, homicide, and sexual assault are higher for [A]boriginal women. Aboriginal women live with inequities under the Indian Act and face discrimination daily. These are all social determinants of poverty.[596]

Charlotte Hrenchuk, Yukon Status of Women Council

Many of the Métis people who live below the poverty line are either young families or families who have more than three children. It is interesting to note that the 20th anniversary of the unanimous all-party resolution in the House of Commons to end child poverty by 2000 has just passed. Yet according to the 2006 census, 32% of Métis children under the age of six were in low-income families, compared to 18% of non [A]boriginal children. According to the 2006 census, 32% of young Métis children were living in families with three or more children, compared to 25% of non-[A]boriginal children. Métis children in rural areas were more likely to live in families with three or more children than Métis children in urban areas—39% versus 30%. Yet the percentage of Métis children living in low-income families was higher in urban areas than in rural areas—36% compared to 20%.[597]

David Chartrand, Métis National Council

b. Human Rights

The Committee was told that while there are clearly moral and economic imperatives to reduce poverty among Aboriginal people, the Government of Canada should also be compelled to act from a human rights perspective. The United Nations General Assembly adopted the Declaration on the Rights of Indigenous Peoples on September 13, 2007.[598] The declaration “sets out the individual and collective rights of indigenous peoples, as well as their rights to culture, identity, language, employment, health, education and other issues.”[599] The declaration prohibits discrimination against indigenous peoples and underlines their right to maintain their own institutions and pursue economic and social development according to their own needs and aspirations.[600] On April 8, 2008, the House of Commons passed a resolution asking “that the government endorse the United Nations Declaration on the Rights of Indigenous Peoples as adopted by the United Nations General Assembly on September 13, 2007 and that Parliament and Government of Canada fully implement the standards contained therein”.[601] Canada was one of only four countries that voted against the Declaration (Australia, Canada, New Zealand, and the United States). Since then two countries, Australia and New Zealand, have reversed their position and now support the Declaration. The Government of Canada announced in the most recent Speech from the Throne that it “will take steps to endorse this aspirational document in a manner fully consistent with Canada’s Constitution and laws”.[602] Witnesses suggested that endorsing the declaration would be an important step towards resolving the inequalities that endure in Canadian society between Aboriginal and non-Aboriginal people. The Committee agrees that this is the first thing the federal government needs to do to begin to address the inequities that affect Aboriginal people across this country and we make it our first recommendation to improve the lives of Aboriginal people living in poverty.

Recommendation 4.4.1

The Committee recommends that the federal government take immediate steps to endorse the United Nations Declaration on the Rights of Indigenous Peoples and implement the standards set out in this document.

c. Federal Government’s Role and Programming

What We Heard

The federal government’s obligation to improve the living conditions of Aboriginal people was underscored repeatedly over the course of our hearings and during the Committee’s visits across the country and to reserves in Québec. Committee members heard from Chief Louie of the Westbank First Nation (WFN) who shared best practices in economic development in the WFN’s well-developed community while acknowledging that their prime location in the Okanagan Valley plays an important role in their success. Chief Louie also shared some of the challenges faced by some of the less fortunate Aboriginal families and talked about federal programs that have a positive impact on children such as the Aboriginal Head Start program.

The Committee also heard from the Métis National Council (MNC) and the difficulties that Métis people have accessing some federal initiatives that currently target specifically First Nations and Inuit communities. The MNC told the Committee that the Métis nation contributes to Canada’s economy, is accountable for dollars spent on programming to assist their people and that the Métis people have made great strides in recent years in terms of developing their own economy. However, much more could be done to ensure access to education and learning opportunities, their participation in the labour market and to improve their overall socio-economic conditions.

Parliament and the Government of Canada have direct, specific, and substantial responsibilities to improve socio-economic conditions for aboriginal people, including the Métis—and I emphasize “including the Métis”.

These responsibilities flow from a variety of sources, not just subsection 91(24) of the Constitution Act of 1867. There's also the responsibility to make the functioning of the Canadian economic union as successful as possible. A successful economy depends on productive, contributing Métis citizens. Canadians cannot afford, either nationally or in their regions and communities, to see Métis people lag behind. As taxpayers to both levels of government, we envisage a strong role for the federal government that goes beyond providing tax credits or reducing taxes for working class Métis Canadians.

[...]

We believe the federal government must move on two fronts. First, it must continue to expand skills training and post-secondary educational support for Métis people. Second, it must expand its support for Métis families for child care and for early learning supports like Métis head starts.[603]

David Chartrand, Métis National Council

The Committee also learned about the plight of Aboriginal people living in urban areas and the work being done by the 120 Friendship Centres established across the country. The National Association of Friendship Centres (NAFC) told members of the Committee that poverty reduction is at the core of their being and that they delivered $114 million in programming and services to urban Aboriginal people in 2009. Similarly to other Aboriginal organizations, the NAFC told the Committee about the challenges urban youth face with regard to completing high school and moving on to post-secondary education and the impact that has on their future. The NAFC also impressed on the Committee that urban Aboriginal people do participate in the labour market and want to have the knowledge required to obtain and maintain better jobs. Urban Aboriginal people are a growing young population in need of assistance to improve their socio-economic situation. They should not to be forgotten by the federal government when it comes to developing a federal action plan to reduce poverty in Canada.

It's the exact same issue that exists in the [A]boriginal community, with half of our kids not graduating from high school, and frankly, it's a national disgrace. There's a bit of irony, though. Despite the fact that our people are not graduating high school, our people are participating in labour market activities at a higher rate than general Canadian society. In urban communities across Canada, 68% of [A]boriginal people participate in the labour force. The non-[A]boriginal rate is 67%. Despite the barriers in education and cultural reintegration in societies, our people are trying to be engaged in the economy; they're trying to work. They are becoming more and more disenfranchised, however, because they're not finding success.

We have twice the unemployment rate as our brothers and sisters in the exact same neighbourhoods who aren't [A]boriginal. Our incomes are way lower. In fact, 29% of aboriginal families in cities and towns across this country live in poverty, as articulated by the low-income cut-off, versus 13% of their neighbours. It's a tremendous disparity that exists. Of single people, 53% of aboriginal people who are single in cities and towns across this country live in poverty, below the low-income cut-off, versus 38% for the non-aboriginal population. When we look to more marginalized groups, we're seeing the greater kind of stratification occur in areas of poverty.

[…]

A lot of times, people will say there are no opportunities in [F]irst [N]ations communities, or, as you heard from our previous speaker, in Métis hamlets, so come to the cities and you'll have a better quality of life and better chances. In fact, urban [A]boriginal residents are not finding that. They're finding the same barriers and the same challenges, while they are surrounded by prosperity.

[...]

The National Council of Welfare, in its recent pre-budget submission, was very clear as to what needs to be done to have poverty reduction in this country. They said there are five areas we need to focus on: child care, affordable housing, education, health care, and employment.[604]

Peter Dinsdale, National Association of Friendship Centres

The Assembly of First Nations (AFN) communicated their concerns through a brief sent to the Committee which clearly calls for the federal government to work in partnership with First Nations and other governments to find solutions to overcome poverty in First Nations communities across the country. The AFN argues that the “federal system of fiscal transfers to First Nations communities is broken”[605] and the inadequacy in funding has been a contributing factor to the widening gap between the socio-economic situation of First Nations and that of other Canadians. It is asking for higher investments in First Nations education and skills development and points out that higher educational attainment is “the most powerful method for bringing improvement in all other social and economic outcomes.”[606] The AFN also reminded the Committee that a well-educated and skilled Aboriginal population could fill some of the labour market shortages caused by the aging of Canada’s labour force. Furthermore, increasing the labour market participation of First Nation peoples will also result in decreased spending on social assistance and other remedial programs and will benefit all Canadians in the process.

First Nations citizens have not enjoyed the same level of basic services as Canadians. It is time to change this by ensuring that funding levels are equitable, fiscal relationships are stable, and governance arrangements reflect First Nations rights and jurisdictions.

Building stronger First Nation economies will help build a stronger Canada. To ensure a future of opportunity, success and prosperity for First Nations, the federal government has to act now.

Through strategic investment combined with structural changes, the Government of Canada can maximize outcomes and create the foundation for our collective well-being.[607]

Assembly of First Nations

Lastly, Committee members saw for themselves the poverty-related issues plaguing two Aboriginal communities during a visit to the Lac-Simon reserve and the Kitcisakik Indian Settlement in May 2010. Both communities, which are located near Val-d’Or in Quebec, face severe problems due to poverty. Most of the homes need major renovations and are poorly insulated. There is not enough housing to support the soaring population (in 2009, there were about 50 births in Lac-Simon, which has a population of close to 1,600 people). In addition, low levels of education compared with other parts of the country result in fewer employment opportunities. Large companies and job-creation projects are rare or non-existent.

In the past, children from these communities had to attend residential schools, where they were cut off from their traditions and language and were sometimes abused. Some of the people who attended these schools have been unable to develop good parenting skills as a result. These factors, as well as poverty and a lack of opportunity, have led to many ongoing social problems, such as alcoholism, drug addiction, violence and suicide. Despite these many issues, what Committee members noted most of all was the Aboriginal community’s intense desire to bring about change, improve their conditions and give their children a brighter future.

Many projects are under way. In Kitcisakik, for example, elementary students will be able to attend school in their community thanks to the construction of a new facility.[608] The development of a sawmill, coupled with proper training, will provide employment to several members of the Algonquin First Nation. Lac-Simon also has development projects, such as a breakfast club and community library. The community was also granted the right to cut 25,000 cubic feet of birch, and training in silviculture is available. Both communities have also launched extensive home renovation projects to address vermiculite, insulation and mould problems.

Despite these efforts, there are still many problems requiring significant resources. The Committee believes that improving the living conditions of First Nations peoples must be one of the most important objectives of a federal action plan to reduce poverty in Canada.

Federal Programs

There are a number of federal programs and services that address in some way the numerous factors that may cause poverty. Indian and Northern Affairs Canada (INAC) is responsible for most of the programs targeted at First Nations and Inuit people. As indicated earlier, the total planned spending for 2010-2011 for INAC is estimated at approximately $7 billion, with over 60% of this amount committed to basic services such as education, social services and community infrastructure.[609] In addition to INAC, other federal departments also offer programs and services that benefit various Aboriginal groups. The most significant is Health Canada’s First Nations and Inuit Health Programming and Services. Planned spending in this area for 2010–2011 is nearly $2.2 billion.[610] Another example Human Resources and Skills Development Canada (HRSDC) which offers an extensive system of employment services to increase the labour market participation of Aboriginal people in Canada through programs such as the Aboriginal Human Resources Development Strategy (AHRDS) and its successor, the Aboriginal Skills and Employment Training Strategy (ASETS).[611] Housing is also a key determinant of quality of life and a number of federal programs, some under the responsibility of the Canada Mortgage and Housing Corporation (CMHC), are offered to increase the number of suitable homes for Aboriginal people living on or off-reserve.

Education

It is well known that educational attainment is correlated with better outcomes later in life, and lessens the likelihood of living in poverty. Those who graduate from high school and pursue post-secondary education are much more likely to be gainfully employed and improve their socio-economic conditions. Research also indicates that supporting the educational attainment of Aboriginal people is a sound investment. According to a recent study, if Aboriginal people reach the same levels of educational attainment and labour market outcomes as the non-Aboriginal population by 2026, federal and provincial governments will benefit from $11.9 billion (2006 dollars) in fiscal savings and increased tax revenues.[612]

Education is a pre-condition for full participation in society and the economy. Education is also of strategic importance with the improvement in education confirmed as the most powerful method for bringing about improvement in all other social and economic outcomes. In other words, educational investments have significant social and economic returns.[613]

Assembly of First Nations

When we look at the challenges related to poverty—for example, early in life, I dropped out of school to work full time, out of necessity. It wasn't because I didn't want an education or my parents didn't want me to have one. We needed the money. Someone had to make extra money because there were mouths to feed, bills to pay. Sometimes you could find yourself in a situation where you just have to do that.

I was very fortunate in my life as an individual to go back and get some further academic opportunities. But a lot of people don't. So when you look at the root problems of why it's causing this divide and why the margin is getting wider, we look at some of the challenges associated with learner outcomes for [A]boriginal people, for example. We know there's a huge difference in the outcomes between our people and other Yukoners and other Canadians, which becomes a very strong barrier for people to try to achieve economic self-sufficiency or get meaningful employment. It perpetuates itself. It gets to be a problem.[614]

Grand Chief Ed Schultz, Council of Yukon First Nations

In addition to the conventional skills that enable participation in the labour market, the Committee recognizes that integrating Aboriginal culture and values in the learning system is essential if we are to improve the living conditions of Aboriginal children and youth. It has been stated that “[a] healthy future for Aboriginal people is also embedded in Aboriginal ways of knowing and being from which Aboriginal people cannot be separated if they are to survive and thrive. Only through Aboriginal development and control over all aspects of their own education can this be assured.”[615] Educational systems must be developed and implemented in collaboration with Aboriginal people. Some witnesses also stressed the need for more coordination between the agencies and stakeholders that fund, govern and deliver educational programming to Aboriginal students.

Education.... At the Vancouver Aboriginal Friendship Centre we are appalled by the lack of understanding of the history of [A]boriginal people, the real history in a non-threatening way, right from the very well-educated to those walking on the street. We teach shared cultural experience at the friendship centre. We share with them what this means, the colonization, how to understand today's issues in relation to that and how to go forward in partnership. So education could be done slightly differently.[616]

Sherry Small, Vancouver Aboriginal Friendship Centre Society

To actually have a big effect on the [A]boriginal question, we need to be able to bring people like Indian and Northern Affairs Canada together with the school boards, the provincial organizations, and the teachers' organizations.…As for [A]boriginal students, as soon as somebody tries to help them, bang, they're gone, back to another community, and there's no coordination between agencies or provinces to try to track them and help them and to actually deal with the issue. Clearly, there's a coordination role and an information role that other partners can play.[617]

Calvin Fraser, Canadian Teachers' Federation

Elementary/Secondary Education

INAC supports the elementary and secondary education (Kindergarten to Grade 12) of First Nations children by delivering funding to band councils and First Nation education authorities. In 2006-2007, the Elementary/Secondary Education Program budget was $1.2 billion, funding that supported approximately 120,000 students and 515 schools. Approximately 60% of First Nations students are taught on reserve, while 40% attend off-reserve schools under provincial authority, usually for secondary school.[618] In 2008-2009, INAC’s total spending on education (including post-secondary education) was slightly more than $1.8 billion.[619]

Research shows that far too many Aboriginal students drop out of high school. According to the 2006 Census, 34% of Aboriginal people between 25 and 64 years old had not completed high school, compared to 15% among the non-Aboriginal population. This education gap was even higher for Inuit and First Nations people living on reserve. Among these groups, about half of the adults had not completed their high school education.[620]

High school completion among First Nations youth is half the Canadian rate. At the current rate, it will take 28 years for First Nations to catch-up to the non-Aboriginal population. 80 percent of First Nations peoples have personal incomes below $30,000 per year. More than half of First Nations peoples are not employed.[621]

Assembly of First Nations

The funding provided by the federal government for Aboriginal education programs has been capped at 2% annual growth since 1996. This is in spite of education costs that have risen at a 4.3% annual rate from 1996 to 2009 on average. The population of the Aboriginal population aged less than 15 has also grown between 1996 and 2006 (last data available) at a 2.2% average annual growth rate.[622] For these reasons, concerns have been raised that current funding amounts are inadequate to meet the educational needs of Aboriginal children and youth. According to the First Nations Education Council, funding levels can no longer support a First Nations elementary/secondary program comparable to provincial school programs.[623] The Committee heard similar concerns over the course of its hearings.

The school dropout rate associated to chronic underfunding in education curbs the social, human and economic development of First Nations. Education is, and must remain, an escape from poverty. Thus, Canada should adequately fund the education sector in order that First Nations communities can provide education that is comparable to that offered to the entire population of Quebec. Let us keep in mind that the funding formula for First Nations schools dates back to 1988. Many schools are in a poor state and new technologies are almost non-existent.[624]

Assembly of First Nations of Quebec and Labrador

Canadians receive services from all levels of government, through direct federal transfers to provinces and territories, and at an average annual growth rate of 6.6% per year. First Nations communities, however, have been forced to operate with a 2% cap on federal funding which is the only source of funding available to cover basic services, such as education, housing, infrastructure and health....There is a significant shortfall in comparability with respect to fundamental services and this has exacerbated the social and economic marginalization experienced by many First Nations peoples.[625]

Assembly of First Nations

I mentioned briefly the systemic cycle of housing, health, and education. As you know, there's a cap on those three areas. On the three core areas of our governments, a 2% cap that was imposed in 1996, that cap has to be lifted. No doubt. Just in my community alone this year we had to turn away 30 students who were ready for university, because we just don't have the money.[626]

Chief Donovan Fontaine, Assembly of Manitoba Chiefs

The federal government recently recognized that issues regarding the quality of Aboriginal education needed to be addressed if Canada’s Aboriginal population is to make any progress. Budget 2010 provided $30 million to be spent over two years to support the implementation-ready tripartite K-12 education agreement. The goal of such agreement is to ensure the First Nations students whether their classroom is on or off reserve, receive the same quality of education and achieve comparable results. Committee members applaud this initiative. However, most members agree that much more will need to be done to eradicate the inequality in education between Aboriginal people and non-Aboriginal people.

Post-Secondary Education

INAC provides financial support to eligible Status Indian and Inuit post-secondary students through the Post-Secondary Student Support Program (PSSSP) and the University College Entrance Preparation Program.[627] The goal of this programming is to increase access and promote success in post-secondary education for First Nations and Inuit students. In 2008–2009, INAC provided $314 million through these initiatives to assist approximately 23,000 students with costs such as tuition, books, travel and living costs.[628]

While an increasing number of First Nations students attend post-secondary education, the actual graduation rates remain below the level of other Canadian students. Many Aboriginal students leave school without graduating. Nonetheless, a growing number of Aboriginal people are attending and completing post-secondary education. In 2006, 14% had trade credentials, 19% had a college diploma and 8% had a university degree.[629]

Despite a rise in post-secondary education (PSE) participation among Aboriginal people, access to PSE remains difficult and insufficient funding is a serious concern. In a 2004 report, the Auditor General assessed the PSSSP and found that the funding allocation process “does not ensure equitable access to as many students as possible” and it is unknown “whether program funds are sufficient to support all eligible students.”[630] Some witnesses also indicated that the funding allocated to post-secondary education programming for First Nations and Inuit students is insufficient. The Committee was also told that Métis students who are not eligible to receive funding from the PSSSP find it difficult to access other forms of loans and grants and often cannot complete post-secondary programs that they have been enrolled in for a few years and are near to completion.

Budget 2010 included a commitment to achieve “comparable” education outcomes for First Nations students. With respect to post-secondary education, comparable education outcomes would mean graduating 65,000 First Nations students within five years. Investment is needed to make comparable education outcomes a reality for First Nations.[631]

Assembly of First Nations

The Indian and Northern Affairs Canada post-secondary student support program has been capped at 2% growth since 1996. According to the Assembly of First Nations, there are over 10,000 eligible [F]irst [N]ations students who are unable to access post-secondary education in the country, and that's a significant challenge. We have people completing high school who are unable to move on to post-secondary education.[632]

Terry Anne Boyles, Association of Canadian Community Colleges

Métis governments should be provided with further support to assist Métis to obtain post-secondary education. As it now stands, the federal government does not cover the cost of post-secondary education for Métis students. Out of the federal aboriginal education funds, Métis students do not receive any. Métis government support for these funds is limited to providing funding for their last year of university out of our training dollars.[633]

David Chartrand, Métis National Council

Recommendation 4.4.2

The Committee recommends that the federal government, in partnership with provincial/territorial governments and Aboriginal governments and stakeholders, take immediate steps to strengthen the commitment to provide high-quality, culturally relevant elementary and secondary education to Aboriginal students; provide better support to Indigenous educational institutions; and improve access to post-secondary education for Aboriginal people.

Recommendation 4.4.3

The Committee recommends that, given the recent and ongoing increase in the Aboriginal children population, the 2% cap on spending increases be eliminated and replaced by funding based on actual costs and needs.

Training and Employment Measures

Despite improvements in the labour force participation of the Aboriginal population between 2001 and 2006, Aboriginal people still do not fare as well as the non-Aboriginal population in this respect and experienced sharper declines in employment rates during the recent economic downturn. The First Nation economy is particularly vulnerable to recessions, as many “First Nation businesses are less well established, overrepresented in the primary resources sector and more likely to be engaged (and exposed) in the export of goods and services”.[634] In 2009, the average employment rate among the Aboriginal population living off-reserve was 57.0%, below the rate of 61.8% among non-Aboriginal people. They were also more likely to be unemployed (13.9%, up from 10.4% in 2008) than non-Aboriginal people (8.1%, up from 6% from 2008).[635] The situation has always been worse for Aboriginal people living on-reserve, the employment rate was 51.9% and the unemployment rate of 24.7% in 2006.[636] The impact of the recession on Aboriginal people was also linked to their level of education. The unemployment rate of the off-reserve Aboriginal population aged 25 to 54 who completed post-secondary education increased from 7.1% in 2008 to 8.7% in 2009, while it increased from 14.3% to 19.6% for the same population with no high school diploma. The increase in the unemployment rate of the non-Aboriginal population (in percentage points) was similar to that of the Aboriginal population among those who had post-secondary education, but smaller for those with no high school diploma. Young Aboriginals were also more affected than non-Aboriginals.

Members of the Committee recognize that the high proportion of Aboriginal people who are unemployed, out of the labour market, and living on low incomes amounts not only to a great injustice but also to a major loss to Canadian society and to our economy. The federal government should consider that a lot more will need to be done to boost the First Nation economy in the years to come and improve the lives of Aboriginal people throughout Canada. By lifting Aboriginal people out of poverty, we will improve their living conditions and health outcomes, as well as increase their participation in education and employment. In light of the aging of our society and despite the recent recession, labour shortages will reappear.[637] Increasing the labour market participation of Aboriginal people is a way of facing this challenge.[638] Members of the Committee believe that we can end the cycle of poverty and lift young Aboriginal people out of poverty.

One in four [A]boriginal children on reservations, and one in three off reservations, lives below the poverty line. That's a lot of children out there, a lot of potential harm, and a lot of long-term benefits and outcomes lost to our society and to the individuals themselves.[639]

Dr. Andrew Lynk, Canadian Pediatric Society

First Nations have the youngest and fastest growing population in the country and represent an important opportunity to address labor shortages in Canada. With the right education, training and skills development, First Nations could fill a significant portion of Canada’s labor force requirements. In fact, Canada’s future prosperity depends on it …

[…]

Canada cannot afford not to act and to provide opportunities for the growing population of First Nations youth. This is also true with respect to growing trend of youth recruitment into gangs and incarceration rates that far exceed the proportion of First Nations in the general population. Rather than spending on programs that maintain the status quo and deal with the symptoms of poverty, we need to address poverty more effectively by investing in collective and individual self-sufficiency through education and skills development.[640]

Assembly of First Nations

I think you have to focus also, more importantly, on the benefits of reducing poverty, not just the short-term benefits but the long-term benefits. Take the [A]boriginal community. If we can reduce poverty there, there will be fewer health problems, there will be less crime, and there will also be additional revenues for the government through additional tax revenues. I think you have to look at it from both the cost and the benefit perspective.

Most studies show that, for example, investing in education, over the long term, results in significant benefits, long-term benefits that greatly exceed the cost.[641]

Andrew Sharpe, Centre for the Study of Living Standards

The federal government has developed programs dedicated to improving the skills and employability of Aboriginal people. The Aboriginal Human Resources Development Strategy (AHRDS) is being replaced by the Aboriginal Skills and Employment Training Strategy (ASETS) in 2010. The Aboriginal Skills and Employment Partnership (ASEP) has been in place since 2003 and was extended to 2012. In addition, the Aboriginal Skills and Training Strategic Investment Fund (ASTSIF) is a temporary initiative as part of the Economic Action Plan.

Aboriginal Human Resources Development Strategy/Aboriginal Skills and Employment Training Strategy

The AHRDS, overseen by HRSDC, offers a myriad of employment services to increase the labour market participation of Aboriginal people in Canada. Aboriginal organizations (80 Human Resources Development Agreement holders to date) receive funding to design and deliver labour market, youth and child care programs and services best suited to meet the local and regional needs of their communities. The programs help Aboriginal peoples prepare for, obtain and maintain employment and assist Aboriginal youth (15 to 30 years of age) in making a successful transition from school to the workplace.[642] Some of the Strategy’s funding is also used to increase the supply of quality child care services through the First Nations and Inuit Child Care Initiative.[643]

Another feature of the AHRDS is the Aboriginal Human Resource Council of Canada, an organization that creates partnerships among Aboriginal organizations, the private sector, and governments in order to promote the full participation by Aboriginal people in the Canadian economy.[644] In April 2010, the council received $2.25 million for its Infrastructure Proposal project, to “develop partnerships and strategies that meet the needs of Aboriginal people and employers”.[645]

In 2008-2009, 59,782 Aboriginal clients were assisted through the AHRDS. Since the program began in 1999, more than 500,000 Aboriginal people have received assistance, over 160,000 have found meaningful employment, and over 53,000 have returned to school.[646] The Committee heard from Aboriginal organizations that the AHRDS is a successful program, but that more funding is required to meet the need that exists, particularly in urban areas. Originally set to expire in 2009, Budget 2009 committed $25 million to extend the AHRDS to 2010.

Finally, employment. The federal government's flagship [A]boriginal employment program, the aboriginal human resources development strategy, has only a toehold in urban areas. The policy focus is on and the vast majority of the agreement holders have a [F]irst [N]ation or Métis or Inuit perspective, as opposed to serving people where they live in cities and towns across the country.[647]

Peter Dinsdale, National Association of Friendship Centres

The ASETS replaced the AHRDS in April 2010 and is scheduled to expire in 2015. Through this strategy, Aboriginal agreement holders (e.g. Aboriginal training centres, Nation councils) will deliver employment training programs and services directed to Aboriginal people.[648] The objective of the program is to increase labour market participation and to fill 18,500 jobs per year. Planned spending for 2010-2011 is $245.6 million and is expected to continue at this level for the two following years.[649]

Now, the MNA [Métis Nation of Alberta] is very appreciative that the federal government introduced the Aboriginal [H]uman [R]esources [D]evelopment [S]trategy, which has enabled us since 1996 to fund training programs to assist our people in finding jobs. Since 1999, over 6,000 Métis in Alberta have found jobs through the MNA's labour market programs.

However, the committee must realize that MNA and other agreement-holders have been operating labour market programs at basically the same level of funding for over a decade. With a youthful population, the number of clients has increased, and the recession is only now compounding this problem, while tuition fees and costs associated with education have climbed since that time. Yet year after year, we operate with budgets that do not increase.[650]

Muriel Stanley Venne, Métis Nation of Alberta

Recommendation 4.4.4

The Committee recommends that the federal government ensure that the new Aboriginal Skills and Employment Training Strategy is adequately funded and is responsive to the needs of all Aboriginal people. A formative evaluation of this new strategy should be conducted within 18 months and Human Resources and Skills Development Canada should share the results of this evaluation with our Committee.

Aboriginal Skills and Employment Partnership Program

The ASEP program provides Aboriginal people with the skills they need to gain employment in major economic industries such as mining, construction, fisheries, tourism, hydro development, and public infrastructure projects. Through partnerships between governments, Aboriginal organizations and the private sector, this project-based program supports multi-year training strategies that lead to long-term skills jobs.[651] In 2008-2009, 3,272 Aboriginal individuals were employed as a result of the existing ASEP projects.[652] Budget 2009 invested an additional $100 million over three years in the program, funding that is expected to support the creation of up to 6,000 jobs for Aboriginal Canadians.[653] While forecast spending for 2009-2010 is $35.8 million, planned spending is expected to increase to $96.0 million in 2010-2011, then to decrease to $42.2 million in 2011-2012, as the program is expected to end in 2012.[654]

Aboriginal Skills and Training Strategic Investment Fund

In Budget 2009, the federal government committed $75 million over two years to establish the ASTSIF. This short-term initiative is designed to help Aboriginal people get the training they need to enter the labour market and benefit from employment opportunities, including those made available through the stimulus package. Through the ASTSIF, the government will establish partnerships with small- and medium-size employers to create concrete, guaranteed job opportunities; assist Aboriginal people with barriers to employment, including skills development; and test innovative approaches to Aboriginal labour market programming.[655] Planned spending for 2010-2011 is $45.1 million.[656] It is expected that 8,200 clients will be served through this initiative. The ASTSIF is an important step toward implementing the new ASETS which recently replaced the AHRDS, as “successful practices learned from the ASTSIF could be implemented as part of the successor” (ASETS).[657]

Other Supports for Aboriginal Children and Families

While resolving the challenges faced by children in Aboriginal communities is not as simple as increasing household incomes, it cannot be denied that income transfers do help. Children across Canada have benefited from the CCTB and the NCBS. The Committee recommends in this report that the CCTB be increased. Members of the Committee believe that this recommendation would also help low-income Aboriginal families to a great extent.

In addition to income transfers, the federal government supports Aboriginal children and families with targeted early childhood education and care (ECEC) programs. These programs are especially important given the larger than average Aboriginal child population. The Committee was told that it is important, however, that the delivery of these programs be culturally sensitive and be available to all Aboriginal communities. Studies show that “[t]here is a strong interest among Aboriginal groups in developing ECEC programs that are operated and controlled by the communities themselves”.[658] The federal government should work in collaboration with Aboriginal stakeholders to ensure that their diverse needs are met.

On the early child centre and the developments there, the child development centre is focused on under five years of age right up to the kindergarten level—just the preschool level.…The childhood development centre, quite frankly, used to be open to all of the public with our [Fi]rst [N]ation children involved. Over time it's evolved to where we focus now on the WFN first nation community children.

The need is so great in that area, we've had to supplement. But we do that with eyes wide open. It costs more to operate than we can provide in actual raising of dollars. Therefore we need to find other programs and other ways to assist, and that's what we willingly do.

The dividends, I think, are very important, because the thinking we have there is to provide the opportunities for that early learning. A lot of the kindergarten children come out of that early childhood development centre with knowledge that helps them in that first grade level. I think it's really important to focus in on that younger age.[659]

Chief Robert Louie, Westbank First Nation

i. Aboriginal Head Start Program

Aboriginal Head Start (AHS), announced in 1995, is an early childhood development program for First Nations, Inuit and Métis children and their families. AHS projects are locally designed and controlled, and typically provide half-day preschool experiences that focus on the core areas of education and school readiness; Aboriginal culture and language; parental involvement; health promotion; nutrition; and social support.[660] On-reserve, AHS programs are managed by the First Nations and Inuit Health Branch of Health Canada. In Urban and Northern Communities, they are managed by the Public Health Agency of Canada. Approximately 4,000 children are enrolled in AHS. In 2006-2007, these programs were delivered at 459 sites on reserves and in urban centres and northern communities at a total cost of $79.3 million.[661]

AHS is regarded by experts and as “one of the best programs around,”>[662] with evidence indicating that the program leads to positive outcomes for participants. For example, research has found that First Nations children aged six to 11 years who attended an AHS preschool were less likely to repeat a grade in elementary school than those who did not attend the program (11.6% compared to 18.7%).[663] Aboriginal groups who appeared before the Committee praised the AHS programs noting the significant difference such programs make for improving educational outcomes later in life. Despite these positive outcomes, the Committee was told that AHS is limited in its reach and does not meet the need that exists for such programming.[664]

Simply put, it [Head Start] provides a better foundation for children to reach their potential. The federal government recognized this in 1990 in the establishment of the off-reserve Head Start program. While this program was very much welcome, and we commend the friendship centres, it has failed to meet the needs of the vast majority of Métis children within the Métis homeland.

Program developers bypassed Métis governments and implemented the program primarily through the friendship centres, which serve only a minority of the Métis population as a result of being located largely in urban centres. Moreover, the resources are too thinly stretched to meet the needs of the Métis population as a whole.[665]

David Chartrand, Métis National Council

Another issue is education, in many aspects. I'm talking about starting at an early age with things such as the child development centres, having our own schools developed by [F]irst [N]nations, having the education, and having future parents know things such as the effects of alcohol on pregnancy and the effects of the use of drugs and the prevention of that. In terms of children in care in this country, from an [A]boriginal perspective, I think we probably have the highest record of that effect, which is a cost to our society. So having prevention and having the head start programs and all of this is needed and is vitally important.[666]

Chief Robert Louie, Westbank First Nation

ii. First Nations and Inuit Child Care Initiative

The First Nations and Inuit Child Care Initiative (FNICCI) is a component of the AHRDS, now known as the ASETS that provides First Nations and Inuit parents who are entering employment or training with access to quality child care services. Aboriginal organizations that enter into agreements with the government can develop and maintain child care programs that correspond to their communities’ needs and reflect traditional child rearing practices.[667] In 2006-2007, FNICCI provided 8,538 child care spaces at 462 different sites in First Nations and Inuit communities, which entailed $57.1 million in funding.[668]

Recommendation 4.4.5

The Committee recommends that the federal government take action to eliminate the gap in well-being between Aboriginal children and non-Aboriginal children by granting as a first step adequate funding to social programs that provide early intervention services to First Nations, Inuit and Métis children and their families including the Aboriginal Head Start program and the First Nations Inuit and Child Care Initiative.

First Nations children are also much more likely to live in foster care homes than non-Aboriginal children. In a study of three sample provinces in May 2005, it was found that one in 10 First Nations children were in foster care, compared with one in 200 other children.[669] Some studies have shown a correlation between poverty and the number of children in foster care.[670] Some witnesses agreed with these findings and also told the Committee that “[t]he intergenerational result of residential school systems have impacted family dynamics, particularly as it relates to gender relationships and parenting styles”[671], which is also a factor in the placement in foster care of so many Aboriginal children.

Recommendation 4.4.6

The Committee recommends that the federal government provide adequate funding for First Nations’ child welfare agencies to deliver in-home support and prevention services to First Nations children and their families

Health Programs

Aboriginal people have poorer health than non-Aboriginal people, a fact not unrelated to their lower income status.[672] This population group suffers disproportionately from conditions such as diabetes, tuberculosis, HIV, and hepatitis C.[673] The Committee was also told that mental health problems are a significant concern among this population and affect Aboriginal people at a much greater rate than non-Aboriginal Canadians. The statistics describe a distressing reality:

When you look at the data on mental health for [F]irst [N]ations, Métis, and Inuit, all Canadians ought to be embarrassed. When you look at the suicide rate among children under 24, for First Nations and Inuit in particular, it's appalling.

If you look at the suicide rate among Canadian youth, it is the second biggest killer of our children between the ages of 15 and 24, second only to cars. If you look at the data for [F]irst [N]ations and Inuit, for which the federal government has responsibility, it is somewhere between five and seven times higher than the national average.[674]

Hon. Michael Kirby, Mental Health Commission of Canada

Health Canada’s First Nations and Inuit Health Branch (FNIHB) is responsible for the availability and accessibility of health services for First Nations and Inuit communities. The FNIHB assists these communities in addressing health barriers and disease threats with a goal that people in these communities achieve comparable health levels than other Canadians living in similar locations.[675] According to Health Canada’s 2010-2011 Estimates, the FNIHB offers a variety of primary care services to approximately 200 First Nations communities that only have limited access to provincial health care services. Many more First Nations communities (600) have access to home and community care services and community-based health programs that focus on a number of issues including mental health and addictions, chronic illnesses, injury prevention, communicable disease control and prevention measures to reduce the incidence of poor health and improve the overall quality of life of First Nations people. Another important program is the Non-Insured Health Benefits Program which “provides over 800,000 eligible First Nations and Inuit with a limited range of medically necessary health-related goods and services not provided through private insurance plans, provincial/territorial health or social programs or other publicly funded programs.”[676]

INAC also plays a role in improving the health and well-being of Aboriginal communities. Among other social programs, INAC is responsible for ensuring that Aboriginal peoples have access to safe water and healthy food.

Food Security

As discussed in Chapter 1 of this report, food security is an issue of particular concern among Aboriginal people. While food is generally more readily available in Canada than in other parts of the world, it is not the case in Northern or remote communities where nutritious food is generally less available and more expensive. Aboriginal people in Canada also need to have access to culturally appropriate foods obtained by traditional means, such as hunting and fishing, in order to preserve their local culture and way of life. The Committee was told that a national action plan to reduce poverty should address the specific food security issues in Aboriginal communities.

Finally, this strategy should include investments in the development of community food centres for remote reserve communities to help preserve local culture, provide hunger relief, increase the affordability of healthy non-traditional foods, and promote food enterprise export development. We're currently supporting the development of a similar model in Sandy Lake First Nation.

This community has the third highest rate of diabetes in the world, alarmingly high food prices, terrible rates of poverty and unemployment, and among the harshest housing conditions in the country. However, this community's resilience, its knowledge, its leadership, and bountiful supply of local food provide both potential and hope for a better future.[677]

Adam Spence, Ontario Association of Food Banks

Is there any way that this committee can encourage government to engage [F]irst [N]ations so that they can be fully involved in co-management of the [salmon] resource and try to encourage government to find a way to supplement [F]irst [N]ations communities when the salmon resource does crash?[678]

Chief Fred Sampson, Nicola Tribal Association

Food Mail Program

The Food Mail Program is a joint program of INAC, Canada Post and Health Canada that provides nutritious, perishable food and other essential items to isolated northern communities at reduced postal rates.[679] About 100,000 people in 135 communities are eligible for the program. Most Food Mail recipients live in Aboriginal communities in the territories, Labrador, and the northern regions of Quebec, Ontario, Manitoba, Saskatchewan and Alberta. In 2008-2009, INAC spent $58.4 million on Food Mail service and shipped approximately 19,900,000 kilograms of food and other goods.[680] In 2006, INAC was directed to conduct a review of the program. Two reports were published, in 2008 and 2009. [681] The report highlighted the problems of the program, such as costs rising at a rapid pace (12% per year between 1996 and 2006) and made some recommendations about potential changes to the program. In Budget 2010, the federal government promised to invest $45 million over two years to fund a new program that is intended to improve access to healthy foods for Northerners bringing the annual budget to $60 million.

Housing Programs

The Committee was told that access to decent, affordable housing is a key element of any poverty reduction strategy. This basic need, however, is a significant challenge for Aboriginal people living both on- and off-reserve. Many Aboriginal people live in poor and unsanitary conditions, overcrowded dwellings, and houses in need of major repairs. There are also shortages of affordable units in many Aboriginal communities. Aboriginal people are overrepresented among the homeless.[682] While there have been improvements over the past decade in the availability and quality of housing for Aboriginal people, those improvements have so far failed to keep pace with the growing Aboriginal population and the increasing proportion of Aboriginal people residing in urban areas.

There is a lack of affordable housing being built. How is it in this country, this province, and this city that our one temporary adult aboriginal homeless shelter is at capacity every night, turning away dozens back onto the street? The [A]boriginal community does not have the same access to capital resources as the non-[A]boriginal community. However, on the program services side last year the AHSC members provided over 50,000 shelter-bed stays, over 40,000 meals, served 2,000 families at food banks, and provided over 9,000 people with services that helped to keep them off the streets.[683]

Patrick Stewart, Aboriginal Homelessness Steering Committee

The UN Special Rapporteur on adequate housing visited Canada in October 2007 and observed that many Aboriginal people are living in overcrowded and inadequate housing conditions and lack basic services including water and sanitation.[684] The Committee witnessed first-hand the appalling living conditions of some Aboriginal groups when it visited the Kitcisakik Indian Settlement, home to the Anicinapek community near Val d’Or in Québec. Such living conditions are correlated with a high prevalence of many health problems that run rampant in Aboriginal communities and lower their life expectancy and should not exist in a prosperous country such as Canada.

In regards to the housing, in our community right now we can't build any more homes because we don't have water and we haven't had adequate water. Right now we run on a reservoir system that provides 70,000 litres of water to our community and yet it takes 80,000 litres of water just to extinguish a house-fire.[685]

Chief Fred Sampson, Nicola Tribal Association

It is imperative that the federal government develops an action plan to fight against poverty. Such a plan should take into account the particularly critical situation of the First Nations and Inuit who live in conditions that resemble those of third-world countries: unsanitary and overcrowded housing, drinking water problems, outdated schools, high unemployment rate, etc. It is urgent to establish conditions that will address the problem of poverty in the short, medium and long terms.[686]

Assembly of First Nations of Quebec and Labrador

The federal government must act in collaboration with Aboriginal people who wish to develop their own capacity in the area of housing. Witnesses spoke about the importance of recent federal investments in housing across Canada, including Aboriginal housing. The 2009 Economic Action Plan committed more than $2 billion to social housing, an investment that included $600 million in targeted funds for First Nations and northern communities. Some Aboriginal organizations praised this investment, but many others indicated that more funding is required to meet the need for adequate, affordable housing in Aboriginal communities. The National Aboriginal Housing Association criticized the 2009 Budget for not addressing the housing needs of Aboriginal people living in cities and rural areas across Canada, as well as for not tackling Aboriginal homelessness.[687] In addition to this recent funding announcement, the federal government supports a variety of programs to assist Aboriginal people secure adequate housing.

In 2006, the Off-Reserve Aboriginal Housing Trust was established to increase investment in adequate and affordable housing units and services for those in need of short-term housing needs. Another $300 million was allocated for a Northern Housing Trust that would be guided by the same objectives, including the provision of rental, transitional and supportive housing in the northern territories. This one-time funding was to be notionally allocated over three years to participating provinces and territories. To develop and sustain a market-based housing capacity on-reserve, the federal government announced funding for another $300 million in 2007.

The First Nations Market Housing Fund, a credit-enhancement vehicle in operation since 2008, aims to provide easier access to private sector housing loans to First Nations people living on-reserve or settlement lands who wish to buy, build, or renovate a home to live in or rent to others. “If conditions are right, the fund is projected to reach 265 qualified First Nations and provide partial financial backing for 25,000 privately financed dwelling units over its first ten years.”[688] To foster on-reserve capacity building, CMHC also offers financial support for initiatives that “will allow First Nations to work towards self-sufficiency in housing.”[689] Another CMHC program, the “Section 95 On-Reserve Non Profit Housing Program”, provides funds to eligible reserves for the construction, purchase, renovation and administration of suitable, adequate and affordable rental housing on reserve. Interest free repayable loans are also available to assist in the development of project proposals. The actual amount of the loan will vary depending on the scope of the project but cannot exceed $75,000 plus 3% of project costs in excess of $500,000.[690] Some witnesses told the Committee about the importance of developing self-sufficiency in housing and empowering Aboriginal people to own their own home. Others warned that many Aboriginal people are struggling to put food on the table and a roof over their head and cannot possibly purchase their own home. Other supports are needed for these impoverished individuals.

Housing is certainly a big, big topic. It guides council elections and it guides the will of our community. We are just in the process now of tabling a final community needs assessment, and housing is certainly part of that. So our council is focusing on meeting the housing needs.

What we have looked at in the past—and we see it across Canada— is that while housing needs are there, [F]irst [N]ation communities like ourselves can't be the full risk-taker. We've seen that. I believe that the full 25% to 30% of the problems in Canada with housing are, where [F]irst nations are involved, in the CMHC housing needs and programs in having to offset the cost of the houses. It's a problem. I've seen [F]irst [N]ations where if you guarantee too much at the governmental level to support the housing and if some of your members don't pay enough, it puts that whole program in the red and you're going to have economic problems. There will be spinoffs and it will affect your community services. It will affect whether or not you are viable as an entity and all those things.[691]

Chief Robert Louie, Westbank First Nation

As an architect, I am frustrated working in first nations communities where sometimes 70% of the people living in the community are on social assistance. And the federal government is trying to push home-ownership in these communities. These communities are under-resourced. As a housing advocate, what do I tell a father with three kids living in a shelter that there are no apartments available at the end of the 30-day stay?[692]

Patrick Stewart, Aboriginal Homelessness Steering Committee

Finally, CMHC also oversees the Residential Rehabilitation Assistance Program (RRAP) On-Reserve that provides financial assistance to complete major home repairs or address a need for basic facilities to low-income households living on-reserve.

Recommendation 4.4.7

The Committee recommends that Aboriginal housing be a component of the federal action plan to reduce poverty in Canada. The plan should include targets, timelines and indicators toward reducing poverty and ensuring greater equity between the living standards of Aboriginal and non-Aboriginal people. This component of the plan should be developed in collaboration with Aboriginal organizations and governments.

Furthermore, the Committee recommends that the federal government work in partnership with Aboriginal government and stakeholders to immediately address the housing crisis in Aboriginal communities and ensure that all Aboriginal people have access to affordable, safe and adequate housing.

Urban Aboriginal Strategy

Over the course of its study, the Committee was frequently reminded of the diversity of the Aboriginal population. The unique circumstances of Aboriginal communities in the North and in urban areas, for example, were highlighted by witnesses during the Committee’s travels and in the testimony of the National Association of Friendship Centres. We were told that federal measures to assist Canada’s Aboriginal population must recognize the range of Aboriginal experiences and be delivered in a way that benefits all Aboriginal people.

For the most part, many of our communities don't have a reserve at all; they have what was called “land set aside”. Now the majority of our nations that are self-governing have what is called “settlement land”.… For our [F]irst [N]ations, when it comes to on-reserve programming, our nations just don't qualify. Yet the social conditions that I spoke of earlier, we're still trying to address. We still haven't succeeded in bringing that equilibrium with other Canadians to our people.

We need those tools; we need those instruments that are being afforded other aboriginals and other Canadians across the country. We cannot take something that was so enlightening and good as a modern treaty, that all of our respective political officers and bureaucracies have negotiated over 30 years and have come to an agreement on, and allow it to be a barrier—and to be a barrier to actually trying to address the issues that were outlined in these treaties, all those negative social conditions.[693]

Grand Chief Ed Schultz, Council of Yukon First Nations

Aboriginal community members who have moved into the city from reserves in search of a better life are immediately marginalized. None of the money or resources available on-reserve is accessible to them.

The systems for their economic support disappear when they reach Edmonton. We now have one of the largest urban aboriginal populations in Canada. There is no initiative currently under way by the federal government to release any of that on-reserve funding to assist them. The money, in some parts at least, needs to flow and follow the individual so as to increase their chances of success in the city.[694]

Julian Daly, Boyle Street Community Services

In the 2006 census, 54% of all aboriginal peoples lived in cities and towns across Canada. That offers an incredible policy challenge, and when we're asking what should the federal government's response be to poverty--in this instance, aboriginal poverty--I think we need to look in the cities and towns where these people are living.

[...]

More practically, and on the ground, I think you need to make sure the existing programs are reaching people where they live. The aboriginal human resource development strategy, now called ASEP, is not going to reach the majority of people living in urban areas, because you continue to flow the funds through a first nation and Métis settlement model solely. I'm not saying it's not appropriate to partner with them. Absolutely, it is, but you need to make sure interventions are reaching people where they live in the cities and towns across this country.[695]

Peter Dinsdale, National Association of Friendship Centres

The Urban Aboriginal Strategy is a federal program that has been specially designed to respond to the unique needs of Aboriginal people living in urban areas. The strategy was developed in 1997 and seeks to support projects, in partnership with community organizations and Aboriginal people. The objectives are to improve life skills, job training and entrepreneurship, and support Aboriginal women, children and families. Between 2003 and 2006, some of the money invested, $28.7 million, also levered an additional $9.6 million from other departments, and $21.8 million from provincial governments, municipalities and private organizations.[696] In 2007, the federal government renewed the strategy for another five years and committed to invest $68.5 million.[697]

According to the 2010-2011 Report on Plans and Priorities for Indian and Northern Affairs Canada, the forecast spending for 2009-2010 was $12.1 million, while planned spending for 2010-2011 and 2011-2012 was expected to be $9.9 million each year.[698]

The program operates in 13 cities whose Aboriginal population represents at least 25% of the total Aboriginal population in Canada.[699] The list of cities does not include Montréal, Victoria, Sudbury, Hamilton, Sault Ste. Marie and Kamloops, which all had, according to the 2006 Census, a population with Aboriginal identity of at least 7,000 people (almost 18,000 in Montréal).[700]

Recommendation 4.4.8

The Committee recommends that the federal government conduct an evaluation of the Urban Aboriginal Strategy, including a review of results obtained, an examination of the adequateness of funding and an assessment of the need to potentially extend this program to more cities, to reach the increasing proportion of the Aboriginal population living in other urban areas than those currently covered under this strategy.

4.5 Other Programs

There are other federal programs that help reduce poverty, some of which were mentioned by the witnesses appearing before the Committee.

a. GST/HST Credit

The goods and services tax and harmonized sales tax (GST/HST) credit is a refundable tax credit available to low- and modest-income taxpayers. The total tax expenditures for this credit are estimated at $3.6 billion per year.[701] Table 4.5.1 summarizes the value of this credit, which is calculated based on civil status, number of children and net family income;[702] the credit is paid quarterly to just one person in a couple. This credit currently rises annually with increases in Statistics Canada’s Consumer Price Index.

In the context of the fiscal stimulus budget, our argument was that we should be pumping money into the hands of low- and modest-income families, who will go out and spend that money to stimulate the economy. Our counter-proposal to the use of income tax cuts was to double the refundable GST credit, which would have pumped a lot of money through the economy in a targeted, focused way.[703]

Ken Battle, Caledon Institute of Social Policy

Table 4.5.1 – GST/HST tax credit by family income, civil status and number of children, 2009-2010

For a single person, the basic credit ($248) is increased by 2¢ per dollar of additional income between $8,047 and $14,547. For all individuals, the credit is reduced by 5¢ per dollar of additional income starting at $32,312. Only children aged 18 or under who live with the person claiming the credit can count. Children aged 19 and over who live with their parents may claim the credit for themselves based on their own income and not that of their parents.

Source: Canada Revenue Agency, GST/HST Credit, Including related provincial credits and benefits for the period from July 2009 to June 2010, http://www.cra-arc.gc.ca/E/pub/tg/rc4210/rc4210-09e.pdf.

In its alternate 2009 budget, the Canadian Centre for Policy Alternatives also suggested doubling the GST credit to help low-income Canadians who do not benefit from certain budget measures such as the changes to employment insurance.[704] In the opinion of the Committee, the GST is an effective tool for helping low- and modest-income Canadians, especially those who do not pay tax since it is a refundable tax credit.

Recommendation 4.5.1

The Committee recommends that the federal government increase the goods and services tax credit by more than the scheduled increases tied to the Consumer Price Index.

b. Public Transit

The Committee heard some evidence that affordable public transit is important to low-income Canadians.

Lastly, it is very important that there be funding strategies for public transit within and between the municipalities. The TTC is mostly supported by the residents of Toronto. It has become hugely expensive, and it is a huge expense in the lives of lower-income people, whether they are working or on social assistance.[705]

Patricia Smiley, South Etobicoke Social Reform Committee

In many United States communities and in Calgary, they're starting to look at transportation poverty, where people actually can no longer afford to live in areas adjacent to places of employment and are spending upwards of 30% of their income on transportation in order to get to employment. This is an emerging phenomenon that has everything to do with the pattern of suburbanization and economic development at this point in time.

So I think the idea that we are now seeing the emergence, certainly among the working poor, of transportation poor, is important and it speaks to what the role is of the federal government in investing in public transportation infrastructure that facilitates more equitable communities. I think it's important that we think about that. I think the federal government certainly would have a role to play in that regard as well.[706]

Katherine Scott, Canadian Council of Social Development

Public transit is more affordable than travelling by car, and is a mode of transport favoured by low-income persons in urban areas for getting to work and other destinations. In 2005, 15.8% of workers with employment income below $10,000 relied primarily on public transit to get to work, compared to 8.3% of workers with employment income of $60,000 or more.[707] This figure is 44% for workers earning less than $10,000 who live in Montreal and Toronto. The federal government contributes financially to public transit and has contributed to the Public Transit Capital Trust since 2006. For 2008-2009 and 2009-2010, $250 million per year were allocated to this trust.[708] This funding is distributed according to each province’s population. Announced in 2007, the Building Canada program will use the gas tax fund to permanently provide about $2 billion per year to municipalities; they in turn may put it toward public transit or any other initiatives.[709] In Budget 2009, the government announced an investment of close to $12 billion over two years for infrastructure projects, some involving public transit. Finally, there is also a non-refundable credit for public transit passes. As a non-refundable credit, the amount spent on passes is multiplied by the lowest tax rate, which was 15% in 2008. The result is deducted from payable tax, so that those who do not pay tax do not benefit from this credit.

Recommendation 4.5.2

The Committee recommends that the federal government increase its contribution to public transit, in particular by making the public transit pass tax credit refundable or by increasing its contribution to the Public Transit Capital Trust.

c. National Pharmacare Program

Certain witnesses appearing before the Committee also raised the possibility of establishing a national pharmacare program.

Social workers recommend the creation of a national pharmacare plan that would provide first-dollar coverage for prescription drugs. This would remove the barriers associated with employment for people who receive social assistance. This would allow them to be in the workforce, start earning some money, and have drug coverage.[710]

Miguel Leblanc, New Brunswick Association of Social Workers

The provinces currently have different pharmacare programs. The Canadian Health Coalition, which represents major unions, recommended the adoption of a national pharmacare plan in order to address the growing cost of pharmaceuticals and in the interest of fairness to the residents of the various provinces.[711] In 2004, a federal/provincial/territorial task force of ministers of health (not including the minister from Quebec) was created to develop a national pharmacare strategy; it was apparently understood that Quebec would keep its own pharmacare system.[712] A progress report was presented in June 2006.[713] According to the Health Council of Canada:

Work has continued on various elements by both the federal government and provincial/territorial governments, although not necessarily collectively under the auspices of the National Pharmaceuticals Strategy ministerial task force. In September 2008, the provinces and territories indicated their intent to negotiate a number of elements of the National Pharmaceuticals Strategy with the federal government—particularly funding for catastrophic drug coverage and expensive drugs for rare diseases. All governments have acknowledged that these are costly initiatives, but it’s not clear who should pay. The provinces and territories have proposed a 50⁄50 cost-sharing arrangement with the federal government. From the provincial/territorial perspective, the inability to resolve funding issues is the primary factor that is holding up progress.[714]

Recommendation 4.5.3

The Committee recommends that the federal government continue negotiations to reach an agreement on the National Pharmacare Strategy.

d. Guaranteed Annual Income

Finally, a guaranteed annual income (GAI) program would automatically provide every person with a basic, non-taxable income. There are many variations on the idea. Some set an income level at which the GAI is partially or completely eliminated. Others set different amounts for different groups (youth, seniors, persons with disabilities etc.). Such a program could entirely or partially replace a number of other programs (for the unemployed, seniors or children).

The Committee heard that the benefits of a GAI would include providing a basic income to help low-income people escape poverty, simplifying the many social assistance programs, and providing income support while eliminating the stigma of receiving social assistance. At the same time, however, the GAI could reduce the incentive to work and could be very expensive. It would also represent a radical departure in the delivery of social programs. Certain witnesses argued for the adoption of some form of guaranteed annual income.

There are certainly models to follow for a guaranteed income in a country like Canada. Canada, which has such abundance, really needs to look after its people. We're a caring and compassionate society.…There would be a minimum level of what a family could expect to get.[715]

Louise Smith MacDonald, Women’s Centres Connect

Support for this option is not unanimous, however:

Another, I would say, non-starter in the debate is the whole idea of a guaranteed annual income. A lot of that debate, in my view, is counterproductive. Basically, one glove does not fit all hands. You have to tailor poverty reduction programs to the needs of the particular client. If you had a guaranteed annual income that put all people out of poverty, it would be extremely expensive.[716]

Andrew Sharpe, Centre for the Study of Living Standards

The Committee has already recommended creating a GAI for persons with disabilities and supporting a disability-related supports program to be delivered by the provinces and territories (Recommendation 4.2.5). The Committee decided not to make a recommendation regarding a universal GAI, considering it preferable to take one step at a time and begin with a program benefitting only persons with a disability.