I leave you with this message as you continue t consult across this country: hear the voices of those with a lived experience of poverty. You can't miss us. We're on every street corner in every small town, village, and city from north to south to east to west, from sea to sea. The number of Canadians living in poverty grows with each passing day. Will we have the courage to no longer allow this injustice to continue to rob our country of so many citizens who live and die in poverty? The cost of not fighting poverty in Canada is a cost that not one of us can afford. We are weaker as people and we are weaker as citizens and we are weaker as a nation when we leave so many behind.

Michael Creek, Voices From the Street June 2, 2009

Committee members have listened to hundreds of Canadians throughout this study and would like to share some of what was learnt about poverty in Canada. This chapter provides background information on defining and measuring poverty in Canada, a statistical profile of poverty in our country, an overview of poverty-related issues such as physical and mental health, food security and housing and homelessness, as well as a summary of what is known about the socio-economic costs of poverty.

1.1 Defining and Measuring Poverty in Canada

In order to report on poverty rates and trends in Canada, it is necessary to first discuss the challenges involved in defining and measuring poverty. The conceptualisation and measurement of poverty is complex and continues to be a source of debate among poverty reduction advocates, social policy analysts and policy-makers. In general, poverty is defined either in absolute terms—inability to obtain the basic necessities of life—or in relative terms—being at a relative disadvantage economically and socially in comparison to others living in the same community. Internationally, multiple measures of poverty have been developed on the basis of these definitions.

In the context of developed nations such as Canada, poverty is usually defined in relative terms. A definition of poverty in the modern welfare state written by the late Peter Townsend, a British sociologist, researcher and social activist, is commonly used as a basis to establish measures of poverty and inequality.

Individuals, families and groups in the population can be said to be in poverty when they lack the resources to obtain the types of diet, participate in the activities and have the living conditions and amenities which are customary, or at least widely encouraged, or approved, in the societies to which they belong. Their resources are so seriously below those commanded by the average individual or family that they are, in effect, excluded from ordinary living patterns, customs and activities.[1]

The implied poverty line or threshold in Townsend’s definition is relative and draws attention to concepts of deprivation and social exclusion. To determine who is at a relative disadvantage compared to others, a minimum acceptable standard of living must first be established for a particular community. This standard can be established using a deprivation index—which can provide information on the quality of housing, clothing, nutrition, healthcare and social engagement, and/or measures of consumption expenditure—as the amount spent by a household on consumer goods and services. Today, social policy analysts tend to agree that in order to paint a complete picture of poverty, measures of low income must be supplemented with measures of deprivation.

The Government of Canada has yet to adopt an official definition or measure of poverty. In the absence of an official directive from the federal government, social policy analysts in Canada commonly use national statistics on low income as thresholds to measure the incidence of poverty, the depth of poverty (i.e., the gap between a household’s or individual’s income and the low income thresholds) and the persistence of poverty for households and individuals over time. These statistics are typically based on the Low Income Cut-offs (LICOs), released annually by Statistics Canada. The LICOs provide a relative measure of low income by calculating the income level at which households spend at least 20 percentage points more of their income than the average household on food, clothing and shelter. The number and proportion of households whose incomes fall below this threshold, and who are therefore considered to be living on low income, can then be determined. The LICOs vary according to family and community size and are calculated on a before- and after-tax basis (see Table 1.1).

Table 1.1 Low Income Cut-offs (1992 base) After Tax, 2008

Source: Statistics Canada, Low Income Lines, 2008-2009, Income Research Paper Series, June 2010, Table 1, p. 19,http://www.statcan.gc.ca/pub/75f0002m/75f0002m2010005-eng.pdf. LICOs for 2008 are presented in this table to ensure consistency with the Low Income Measures (LIMs) presented in this report. Although LICOs for 2009 are available, LIMs for this year has not yet been released by Statistics Canada.

Another measure released by Statistics Canada, the Low Income Measure (LIM), is set at half the median family income (see Table 1.2). The LIM is adjusted for different household types and calculated on the basis of market income, before-tax income and after-tax income. It is most often used for international comparisons (many countries set their low-income measure at 50% or 60% of the median family income).

Table 1.2 Low Income Measures After Tax, 2008

Source: Statistics Canada, Low Income Lines, 2008-2009, Income Research Paper Series, June 2010, Table 3, p. 26, http://www.statcan.gc.ca/pub/75f0002m/75f0002m2010005-eng.pdf. LIMs used to be calculated according to the number of adults and children in the economic family. Since 2010, they are calculated by number of individuals in the household. For more details, see Statistics Canada, p. 10.

The use of the low-income thresholds established by the LICOs and LIM as substitutes for measures of poverty has raised a number of concerns. Among these is the concern that low-income measures are not valid indicators of material or social deprivation. Studies have shown that household income, even when adjusted for household size and composition, is not an indicator of actual living standards. Low-income measures fail to take into account personal assets, fringe benefits, the value of free or subsidized services and other community supports that may improve the living standard of some people whose income is below the low-income thresholds. Unreported income can also undermine the reliability of these measures. Nonetheless, data on household income remains the best data currently available on the financial resources of individuals.

Poverty thresholds can also be established based on the cost of a specific basket of goods deemed essential to meet particular community standards of expenditure. To complement the two low-income measures compiled by Statistics Canada, in 1997, Human Resources and Skills Development Canada (HRSDC) (then Human Resources Development Canada) in collaboration with a Federal-Provincial-Territorial Working Group of Officials on Social Development Research and Information developed a measure known as the Market Basket Measure (MBM). The MBM is a measure of the disposable income (total income less income/payroll taxes, payroll deductions and child support/alimony payments) a household needs to purchase a specific basket of goods and services. The basket includes food, clothing and footwear, shelter, transportation, and other goods and services (e.g., basic telephone service, school supplies, household needs, personal care products, etc.). The cost of this basket is calculated for 48 different regions across Canada. It should be noted that some provinces have adapted the MBM to meet their particular monitoring needs. The MBM thresholds are adjusted for family size and composition. MBM thresholds have been available since 2000 on the same base. That base was revised in 2008.[2] Table 1.3 presents a sample of MBM thresholds for selected Canadian cities in 2007 (2008 base).

Table 1.3 Market Basket Measure Thresholds for Family of Two Adults and Two Children in Various Cities, 2007 (2008 base)

Source: Human Resources and Skills Development Canada, First Comprehensive Review of the Market Basket Measure of Low Income, Report SP-953-06-10E, June 2010, p. 75, http://www.canadiansocialresearch.net/mbm_2010.pdf.

The Basic Needs Poverty Line (BNL) is another measure that establishes poverty lines based on a basket of goods and services. The BNL was developed by Chris Sarlo, an Associate Professor of Economics and Director of the School of Business and Economics at Nipissing University in North Bay, Ontario, and an adjunct scholar with the Fraser Institute, who for many years has been raising concerns over the use of the LICOs as thresholds to measure poverty in Canada. The BNL is considered to be a measure of “real deprivation” or a lack of basic necessities. It is based on a basket of goods and services needed to maintain the long-term physical well-being of an individual according to a minimum acceptable standard within the community in which that person resides. Although Sarlo argues that the BNL is a more realistic and credible measure of poverty than the LICOs, he advocated for the use of both relative and absolute measures of poverty in his testimony before the Committee.

I think we have to be careful. A poverty line is not a show of our compassion; it is simply a useful way to distinguish those people who are poor from those who are not. If we get that tangled up with emotion and passion, I think we're not going to serve public policy very well.

Those are fine expressions of what it means to be poor. I think we simply have to decompose those two types of measure and measure both absolute and relative.

[...]

The basic needs measure that I've developed should be helpful if you decide to measure the extent of real deprivation in Canada. This measure essentially takes the cost of a basket of basic needs in different parts of Canada for families of different sizes and sets up those costs as poverty lines.

As I mentioned just a moment ago, I really would urge you to resist the temptation to bulk up the poverty line by adding things like recreation items and vacations and so on. The critical issue here is not that the poor shouldn't have these things—of course they should—the question is whether people are impoverished for lack of them. I think there's great value in determining how many people just can't afford even the basic needs; to add more onto the poverty line would simply muddy the waters.[3]

Chris Sarlo, as an individual

Because the BNL is based on a fairly strict market basket of goods, it calculates significantly lower poverty thresholds, rates and trends than those calculated using the LICOs and the LIM. The BNL also calculates poverty lines that are lower than the thresholds set under the MBM as the goods and services included in the MBM’s basket go beyond a subsistence standard. Table 1.4 presents the basic needs poverty lines for 2007.

Table 1.4 Basic Needs Poverty Lines by Household Size, 2007

Source: Chris Sarlo, What is Poverty? Providing Clarity for Canada, Fraser Institute, May 2008, Table 1, p. 8, http://www.fraserinstitute.org/commerce.web/product_files/What_is_Poverty.pdf.

Other agencies and social planning councils across Canada have also developed their own market basket measures.[4] For example, the Montreal Diet Dispensary (MDD), a non-profit agency serving the Montreal community, has been establishing basic budgets needed to maintain health since the middle of the twentieth century. A basic needs budget includes allowances for shelter, electricity, heating, water tax, food, clothing, personal and domestic care supplies, which vary according to the size, sex, age and activities of the members of a family. The MDD also devises a budget that meets a minimum adequate standard of living. This budget includes additional items that will allow a household to actively participate in the community (e.g., telephone, transportation, entertainment, leisure, religion, and school supplies). The MDD budgets are updated annually and are used for budget counselling, making comparisons with other low-income measures, and advocating for people living in poverty.[5]

If we want to know how Canadians are really doing, many social policy experts argue that we need additional indicators of well-being. We would be remiss not to mention an interesting project headed by the Honourable Roy J. Romanow, Chair of the Institute of Wellbeing Advisory Board, which has begun to shed more light on the quality of life of Canadians using a Canadian Index of Wellbeing (CIW). The CIW is being developed by a group of experts and is backed by rigorous Canadian and international peer review and public consultation.[6] It is a new tool to measure societal progress that will help policy-makers and social analysts assess whether social programs are making a difference and achieving the intended goal of improving the quality of life of Canadians. When fully implemented, the CIW will provide information on eight quality of life categories: arts, culture, and recreation; civic engagement; community vitality; education; environment; healthy population; living standards; and time use. Going forward, this innovative new tool will be of interest to the study of poverty in Canada. Among other applications, the CIW will provide data that could be used to develop a material and social deprivation index and improve our understanding of what it means to live in poverty and what is needed to promote social inclusion in Canada.

1.2 Recent Trends[7]

I want to talk to you about a problem that I think is real. I say “real” because many people try to downplay it or conceal it. Poverty isn't the subject; it's people.[8]

Pierre Métivier, United Way Québec and Chaudière-Appalaches

In 2008, 9.4% of Canadians lived on a low income. This was slightly up from 2007 when Statistics Canada observed the lowest rate of low income since it began collecting this information in 1976 (9.2%) and was significantly lower than the high of 15.2% observed in 1996.[9] Despite this progress, low income remained a significant challenge for 3.1 million Canadians.[10] Witnesses told the Committee that a study of low income must focus on the individuals who face this reality each day.

The overall incidence of low income varies considerably across Canada’s provinces. In 2008, low-income rates were highest in British Columbia (11.4%), followed by Québec (11.2%) and Ontario (9.3%). Prince Edward Island had the lowest low-income rate at 5.2% (See Chart 1.1). While the overall low-income rate increased between 2007 and 2008 in Canada, it decreased in some provinces, such as Manitoba (from 10.1% in 2007 to 8.6% in 2008) and New-Brunswick (from 8.4% to 7.1%). The general trend in recent years (before 2008) was downwards, particularly in certain provinces: the low-income rate in Newfoundland and Labrador decreased from 12.2% in 2003 to 7.3% in 2008, while Alberta’s low-income rate dropped from 10.7% to 5.6% over the same period.[11]

The territories are also home to many Canadians living on a low income. In 2008, 3,530 people in Yukon, 6,630 people in the Northwest Territories, and 8,000 people in Nunavut lived on a low income according to Statistics Canada’s after-tax LIM.[12] The problem of poverty in the territories is magnified by the high cost of living in northern Canada.

We see many of the same problems experienced in southern Canada, but here in the NWT the impact of poverty is magnified by transportation challenges, the boom and bust cycle of our economy, electricity costs that top $2 per kilowatt hour in some communities. In Paulatuk, which is home to 300 people on the shore of the Beaufort Sea, a two-litre carton of milk costs almost $9 and a loaf of bread will take a $7.20 bite out of your family budget.[13]

Gordon Van Tighem, Northwest Territories Association of Communities

About 6.3% of persons living in economic families[14] (1.7 million persons) lived on low incomes in 2008, which represents a small increase from the 2007 rate (6.0%), the lowest observed by Statistics Canada in over 30 years.[15] Unattached individuals did not fare as well and had a significantly higher low-income rate of 27.2% (See Chart 1.2).[16]

To better understand what it means to live below the low-income threshold, it is also important to look at the depth of poverty.[17] In 2007, low-income families needed an average of $7,200 to bring their income above the LICO threshold, while unattached people faced a low-income gap of $6,500.[18]

There is considerable turnover in the low-income population on a year-to-year basis. Of the one in five individuals who experienced low income in the six-year period between 2002 and 2007, most lived in this situation for one or two years (40% and 21% respectively), while 11% lived on low income for the entire six-year period.[19] (See Chart 1.3)

The Committee heard that a similar trend in the persistence of low income was observed in previous years.

Between 1999 and 2004, a six-year period, about 80% of Canadians did not experience any low income. Among the 20% who did, many of the spells of low income were quite short. About 40% lasted one year or less, so a lot of low income is quite short. About one-quarter of those spells lasted five years or more; that's more chronic.

What we see is that while 20% of the population experienced low income at some point during that six-year period, 4% or maybe 5% of the population were in what we might refer to as a chronic low-income condition.[20]

Garnet Picot, Statistics Canada

Despite an overall decline in Canada’s low-income rate, inequalities within the population have grown over time. Growth in after-tax income was observed in all income quintiles[21] between 1989 and 2007, but income rose by 7.6% among the lowest quintile and 30% among the highest quintile. As a result of these different rates of growth, the average after-tax income of families in the highest income quintile was 5.4 times that of families in the lowest income quintile in 2007.[22] In 2008, food, shelter and clothing accounted for 52% of total spending among households in the lowest income quintile, while spending on these necessities accounted for only 28% of total spending among households in the highest income quintile.[23] The Committee heard not only that income inequality in Canada has grown in recent years, but also that it has increased more significantly than in other countries.

Income inequality has continued to grow, so the gap between the rich and the poor, as measured, actually has grown. That's a trend that's evident in many advanced industrialized countries in Europe, and in the United States it's even more pronounced. You see income concentrating in the hands of upper-income Canadians.[24]

Katherine Scott, Canadian Council on Social Development

Witnesses who appeared before the Committee explained that the decline in low-income rates since the mid-1990’s is related to economic growth. During this period of expansion, fewer people entered low income while more people exited this situation. Between 2006 and 2007, for example, 2.3% of Canadians fell into low income and 3.5% got out.[25] Some witnesses believed, however, that more could have been done during this time to eliminate low income in Canada.

From the mid-1990s, Canada, as you know, experienced a very long period of economic growth, a very long period of enormous budgetary surpluses, and in some years they were absolutely colossal. It was therefore a period that would have been conducive to a decrease in poverty, and even more than a decrease, it was a period that should have been conducive to the elimination of poverty in Canada. Unfortunately, this is not what happened.[26]

François Saillant, Front d'action populaire en réaménagement urbain

In marked contrast to the economic growth observed over the last decade, part of the Committee’s study took place during a period of economic recession. Between 2007 and 2008, 2.6% of Canadians fell into low income and 3.0% got out, which represents a small deterioration of the situation compared with the preceding year. Because the recession only started at the end of 2008, it is possible that the impact of the recession might only be fully reached with the 2009 data. Witnesses told the Committee that they feared the worsening economic situation would propel many more Canadians into low income and aggravate various social problems.

I think we all know that as the global recession has taken hold, unemployment has gone up. As job opportunities disappear, many of the supports that still exist—and many have been eroded and are not there—are strained, and low-income people are often driven further into poverty. The person on social assistance who might have been ready to take a part-time job at the local retail outlet is often not finding that job. That's what we're hearing on the ground in this area.[27]

Laurel Rothman, Campaign 2000

Now that we are in a recession, the most vulnerable Canadians are at even greater risk. Already people working full time at minimum wage are living in poverty, as measured by the low-income cut-off. The poor are the first to lose their jobs and find it harder to get new work. Social assistance and employment insurance are inadequate to prevent people from living in poverty. As the Canadian economy continues to slump, it is clear that the difficulties faced by poor Canadians will increase, and more Canadians will slide into poverty.[28]

Karri Munn-Venn, Citizens for Public Justice

1.3 Vulnerable Populations[29]

The Committee in its hearings paid particular attention to population groups that are more at risk of living on low incomes.[30] These groups include children; lone-parent families (particularly female lone-parent families); women; unattached individuals; seniors; Aboriginal people; people with disabilities; recent immigrants and visible minorities; and low-wage workers.

a. Children

Of course child poverty is vitally important, because children who start out their lives in poverty may not be able to escape from that poverty trap, so it's a very serious issue. We should remember that children are poor because their parents are poor, and many of those parents are women who are raising children on their own.[31]

Monica Townson, as an individual

In 1989, members of the House of Commons unanimously resolved to seek to achieve the goal of eliminating poverty among Canadian children by the year 2000. At the time, 11.9% of Canadian children lived in low-income households. The most recent figures show that in 2008, nearly two decades later, approximately 610,000 children under the age of 18 continued to live in low-income households, or 9.1% of all children in Canada.[32]

Children’s low-income rates vary significantly according to the type of family in which they live. In 2008, 6.5% of children in two-parent families experienced low income, while a little less than one in four children (23.4%) in female lone-parent families faced this reality (See Chart 1.4).[33] Children in certain population groups can also be more at risk of low income. Those in recent immigrant families, for example, had a low-income rate of 39.3% in 2005.[34]

A number of witnesses told the Committee about the detrimental consequences that living on a low income can have on numerous aspects of children’s lives, including their future prospects.

I would like to say that poverty—in particular, child poverty—is more than just a social justice issue or a political embarrassment. We would frame it also as a public health issue.[35]

Dr. Andrew Lynk, Canadian Paediatric Society

Research has continually shown that poverty has a tremendous impact on children's ability to learn. Teachers see the effects and consequences of poverty in their classrooms on a daily basis. They know how hard it is for children to learn when they are hungry or excluded because they cannot afford fees, materials or proper clothing. The wasted talents of children who cannot achieve their full potential represents a huge loss for Canadian society.[36]

Barbara Burkett, Elementary Teachers' Federation of Ontario

b. Lone-Parent Families

What's interesting is that the female lone parent's poverty rate has fallen significantly [since the mid-1990’s] from 53% down to 32%, so there's been a 20% fall in the female lone-parent poverty rate, which is very positive. That again reflects both the better economy—many of those single parents have jobs—and also the increased child benefits.[37]

Andrew Sharpe, Centre for the Study of Living Standards

In 2008, the rate of low income among lone-parent families was 18.4%, over three times higher than among two-parent families (6.0%). Female-headed lone-parent families were particularly at risk of low income and had a low-income rate of 20.9%, compared to 7.0% among male-headed lone-parent families (See Chart 1.5). The same year, 36% of all children living in low-income households, approximately 218,000 children, lived in female-headed lone-parent families.[38]

In recent years, there has been a considerable decrease in lone-parent families’ low-income rates, which fell from 35.2% in 2002 to 18.4% in 2008. This improvement was driven by the decline in low-income rates among female-headed lone-parent families, who saw their low-income rates fall significantly, from 40.4% to 20.9%, over this period. Witnesses who appeared before the Committee attributed this improvement to both the positive economic climate and increases in child benefits.[39] Low-income rates among male headed lone parent families have fluctuated in recent years, which may be due to the poorer reliability of the data for this small group of individuals. Their rate rose recently from 6.9% in 2006 to 9.2% in 2007, then decreased to 7.0% in 2008 (See Chart 1.5).[40]

Lone parents may be particularly affected by inflexible work hours, long commutes and limited access to child care, factors that can reduce their employment prospects and increase their vulnerability to earnings instability.[41] The number of earners in lone-parent families is a significant determinant of their low-income status. In 2008, female-headed lone-parent families with no earners had a low-income rate of 76.5%, while those with one earner had a low-income rate of 14.2%.[42] The Committee heard that a similar disparity existed the previous year, although low-income rates were higher among both groups.

Also, the poverty rate is extremely sensitive to whether or not there's an earner in the family. For example, the poverty rate for single parent households, female, where there's no earner, is 80%. When there's one earner, it drops to 20%. That's, of course, the effect of jobs on poverty.[43]

Andrew Sharpe, Centre for the Study of Living Standards

c. Women

Now, a gender-based analysis of poverty would show that women are more likely to be poor. If they raise a family alone, their risk jumps. Other groups of women are disproportionately likely to experience poverty—unattached women under age 65, women with disabilities, and racialized and [A]boriginal women.[44]

Johanne Perron, New Brunswick Coalition for Pay Equity

In 2008, 9.9% of females in Canada, over 1.6 million women, lived on low incomes. This is down from 2000, when 13.6% of females, over 2 million women, faced this situation. While women generally have higher low-income rates than men, this disparity has lessened over time. A difference of 0.9 percentage points separated the male and female low-income rates in 2008 (9.0% and 9.9% respectively), compared to 2.2 points in 2000 and 2.8 points in 1990 (See Chart 1.6).[45] Witnesses who appeared before the Committee spoke of the recent progress in women’s low-income rates.

We are seeing some fairly dramatic improvements for women overall. We are seeing a closing of the gap between men and women in terms of poverty measurement rates. So by and large, it's a fairly positive story.[46]

Sean Tupper, Department of Human Resources and Skills Development

Despite these advancements, however, women are still more likely than men to experience persistent poverty. Over a 6-year period (2002 to 2007), 5.6% of females experienced poverty for 4 to 6 years, compared to 4.6% of males.[47]

Some witnesses explained to the Committee that certain groups of women are more vulnerable to low income than others. In 2008, a 22 percentage point gap separated the low-income rates of unattached females (29.0%) and those in economic families (6.6%) (See Chart 1.6). The same year, females 18 to 64 years of age experienced a higher rate of low income (10.7%) than those under 18 years (8.8%) and 65 years and over (7.6%).[48]

In 2007, the average earnings of women working full-time, full-year ($44,700) were only 71.4% of those of their male counterparts ($62,600).[49] Witnesses who appeared before the Committee identified women’s lower earnings as a key factor in their higher rate of low income.

Women in Canada continue to face a persistent wage gap, which has narrowed little since the 1980s. Today, full-time working women earn 71¢ for every dollar earned by men. Part-time and seasonal workers earn 54¢, women of colour earn 38¢, and [A]boriginal women a mere 46% of what men are paid.

The trend is worse and the gap is wider for women with post-secondary education. In 1985, university-educated women earned 75% of what men earned, a figure that had dropped to 68% by 2005.[50]

Susan Russell, Canadian Federation of University Women

d. Unattached Individuals

Here in Canada the group with the highest risk of poverty is the single people of working age, with over 30% being in poverty.[51]

David Langille, Ontario Coalition for Social Justice

Unattached individuals are another group particularly at risk of low income. In 2008, the low-income rate among unattached individuals was 27.2%, over four times higher than among individuals in economic families (6.3%). This situation was even more prevalent among unattached individuals less than 65 years of age, 31.3.0% of whom lived on low income that year.[52] Low-income rates among unattached individuals vary, however, depending on the age group. The data by age is available for 2005 (See Table 1.5).

Table 1.5 - Low-Income Rates Among Unattached Individuals by Age, 2005

Source: Yan Feng, Sangita Dubey and Bradley Brooks, Persistence of Low Income among Non-elderly Unattached Individuals, Income Research Paper Series, Statistics Canada, June 2007. p. 12, http://www.statcan.ca/english/research/75F0002MIE/75F0002MIE2007005.pdf.

In the past, unattached women were much more likely than their male counterparts to experience low income, but in recent years their low-income rates have converged. In 2000, 30.0% of unattached men and 35.7% of unattached women lived on low incomes, a difference of more than 5 percentage points. By 2007, this gap had vanished. In 2008, the gap increased again, with 29.0% of unattached women and 25.4% of unattached men living on low incomes. The decrease in the gap over the recent years has been largely attributed to the narrowing of the gender gap in the low-income rates of unattached seniors. The difference persists among unattached men and women of working age (See Chart 1.7).[53]

e. Seniors

The federal government, along with the provinces, has almost succeeded in eliminating poverty among seniors, over the last 20 to 30 years. In the 1960s and 1970s, Canada was one of the OECD countries with the highest percentage of poor among the elderly. Now, we are among those who have the fewest.[54]

Alain Noël, as an individual

Low-income rates among seniors (65 years and older) have dropped significantly over the past 30 years, from 30.4% in 1977 to a low of 4.9% in 2007, when 204,000 seniors lived on low incomes. However, it increased to 5.8% in 2008, which represents 250,000 seniors. Since 1990, seniors have enjoyed a lower rate of low income than other age groups. In 2008, seniors’ low-income rate was lower than the low-income rates of children under 18 years (9.1%) and people 18 to 64 years of age (10.2%).[55] Seniors are also less likely to experience persistent poverty than other age groups.[56]

Improvements in low-income rates among the senior population have been attributed to the introduction and expansion of federal income security programs such as the Canada Pension Plan (CPP), Old Age Security (OAS), and Guaranteed Income Supplement (GIS) programs.[57] Witnesses who appeared before the Committee spoke of the considerable progress that has been made in reducing poverty among seniors, and expressed the hope that other disadvantaged groups will enjoy similar reductions in their low-income rates in the future.

Before I begin my remarks, I just wanted to remind the committee members that Canada does have at least one great success story in the field of poverty reduction. When I began my career over 30 years ago, Canada had the highest rate of poverty of any western country among its seniors. Our poverty rate among seniors was higher than it was in the United States in the late 1970s. By 2000 our seniors had among the lowest poverty rates of any western country. In this particular instance we rival good old egalitarian Sweden. My reason for pointing that out is that we've demonstrated we can do it. The big question is whether we can duplicate this kind of success among other disadvantaged groups in Canada.[58]

John Myles, as an individual

Within the senior population, certain groups are more likely than others to experience low income. A gap of four percentage points separates the low-income rates of senior men (3.6%) and women (7.6%), a larger gap than exists in the population at large (0.9 point). The Committee heard that senior women are particularly at risk of low income.

We focus on single women 50 years of age and older because far too many in this age group are experiencing unemployment or low-waged work leading to poverty in their later working years and of course into their retirement years.… Women in this age category suffer as a result of a lifetime of inequality.[59]

Elsie Dean, Women Elders in Action

There is also a significant difference between the low-income rates of seniors who live in economic families and those who are unattached. In 2008, only 1.6% of seniors in economic families lived on low incomes, compared to 15.6% of unattached individuals in the same age group (See Chart 1.8). Unattached senior women were the most at risk of low income, with a rate of 17.1% compared to 12.1% among their male counterparts.[60]

f. Aboriginal People[61]

The socioeconomic and sociosanitary indicators that are currently available to us clearly show the difficulties faced by the First Nations communities of Québec and Canada: poverty, neglect, drug and alcohol addiction, diabetes, obesity, life expectancy, infantile mortality and suicide. These indicators reveal the significance of the social inequalities in health which face First Nations compared to the Canadian population. In Québec, Aboriginal people are among the five groups most at risk of experiencing a situation of poverty and social exclusion.[62]

Assembly of First Nations of Québec and Labrador

The incidence of low income among Aboriginal people is significantly greater than among the non-Aboriginal population. Of those with Aboriginal identity living in private households, 18.7% of individuals in economic families and 42.8% of unattached individuals experienced low income in 2005. Low-income rates were even higher among the Aboriginal population living in census metropolitan areas (CMAs),[63] where 25.1% of those in economic families and 48.5% of unattached individuals faced this situation. In comparison, the non-Aboriginal identity population had low-income rates of 8.4% for individuals in economic families and 28.0% for unattached individuals that same year.[64]

In 2005, the average and median incomes of the Aboriginal identity population ($23,888 and $16,752, respectively) were significantly lower than those of the non-Aboriginal identity population ($35,872 and $25,955).[65] This income gap is particularly evident in northern Canada, where poverty is also compounded for many Aboriginal families by the high cost of living. The cost of a basket of healthy food in many Inuit communities, for example, is at least two times higher than the cost of a comparable basket in southern Canada.[66] The Committee heard that low income interacts with other problems facing the Aboriginal population and leads to serious consequences.

One in four [F]irst [N]ations children live in poverty, and the unemployment rate in [F]irst [N]ations communities is four times the national average.

It doesn't have to be this way. Collectively we now have the resources, the technology, and the knowledge necessary to end poverty, both globally and here at home. We need a plan to make poverty history, both globally and in Canada—and for [A]boriginal peoples.[67]

Dennis Howlett, Make Poverty History

Our opening statement will focus on the situation of [A]boriginal people. The CSQ represents the people who work on the Cree and Kativik school boards. We represent more than 2,000 members in these communities.

[...]

Need I point out that there are still [A]boriginal communities that do not have access to running water or electricity? In most communities, families are packed into homes that become small because of the size of the families and the shortage of housing.

Need I point out that [A]boriginals have a functional illiteracy rate that is four times higher than the Québec rate, an infant mortality rate that is three and a half times higher, a suicide rate that is six times higher for young people under 20, and incomes that are 33% lower? The situation is unfortunately not much different today. In some communities, the suicide rate in adolescents and young adults is 20 times higher than the rate in the rest of Canada.

Many studies, and often tragedies, have shown that young [A]boriginals are more often exposed to problems such as alcohol abuse and drug addiction. Combined with pervasive poverty, persistent racism, and a legacy of colonialism, [A]boriginal peoples have been caught in a cycle that has been perpetuated across generations. This was a quote from an excerpt of Roy Romanow's report.[68]

Daniel Lafrenière, Centrale des syndicats du Québec

Aboriginal Children

In 2005, 27.5% of Aboriginal children under 15 years of age lived in low-income households in Canada: 33.7% of First Nations children, 20.8% of Inuit children, and 20.1% of Métis children faced this situation. Aboriginal children were particularly at risk of low income compared to non-Aboriginal children, who had a low-income rate of 12.9%.[69] (See Chart 1.9) They were also more likely to live with a lone parent of either sex, a grandparent, or another relative. In 2006, 29% of Aboriginal children under 15 years lived with a lone mother.[70]

A 2006 study of Aboriginal children revealed that, according to the before-tax LICO measure, 49% of young First Nations children under six years of age living off-reserve and 32% of young Métis children that same age were members of low-income families, while non-Aboriginal children in the same age group had a low-income rate of 18%.[71] The incidence of low income among Aboriginal youth (16-24 years) was determined to be 63.0% among unattached youth and 19.2% among those in economic families in 2005. Non-Aboriginal youth had lower rates of low income: 59.1% among unattached individuals and 9.8% among those in economic families.[72]

g. People with Disabilities

Canadians with disabilities are more than twice as likely to live in poverty as other Canadians. The incidence of poverty among [A]boriginal people with disabilities is even higher. People with disabilities face exclusion from quality education, employment, and from participation in their communities. Compared to men with disabilities, women with disabilities face additional economic disadvantage.[73]

Bev Matthiessen, Alberta Committee of Citizens with Disabilities

In 2006 4.4 million Canadians, or 14.3% of the population, lived with a disability, with women reporting higher disability rates than men.[74] Some people, however, move in and out of disability, and a sizeable proportion of this group may have a temporary limitation or may experience disability in phases or episodes.[75]

People with disabilities have a lower average income than those without a disability ($28,503 compared to $37,309 in 2006),[76] and studies have also found that this population is less likely to have high earnings and more likely to have low earnings than people without disabilities.[77] Women with disabilities have lower incomes and are less likely to be employed than their male counterparts.[78] Families of children with disabilities are more likely to live on low incomes, and financial problems were found to increase with the severity of a child’s disability.[79] As a result of their lower incomes, people with disabilities are also more likely to rely on government income support programs.[80]

I would like to say that women with disabilities—and particularly lone-parent mothers with disabilities—are the poorest people in this country. There’s no statistical argument that can be made that denies this fact. The lowest income level in this country belongs to women with disabilities. The poorest people in this country are women and children with disabilities.[81]

Bonnie Brayton, DisAbled Women’s Network of Canada

Just over 75% of adult Canadians with intellectual disabilities who do not live with their families are living in poverty. Children with disabilities are twice as likely as other children to live in households that rely on social assistance as a main source of income. Families of children with disabilities are more likely to live in poverty than other families.[82]

Anna Macquarrie, Canadian Association for Community Living

People with disabilities also have a weaker attachment to the labour force. In 2006, 43.9% of people with disabilities between 15 and 64 years of age were not in the labour force, compared to 19.8% of people without a disability (See Chart 1.10). Barriers to labour force participation include being prevented by the disability or limitation itself, the requirement of workplace accommodation, and discrimination in the workplace.[83] Witnesses who appeared before the Committee explained that this lack of access to the labour market is directly related to low-income levels among people with disabilities, and stressed that this situation is unacceptable.

We've been concerned for years about the fact that persons with disabilities in Canada face disproportionately higher rates of poverty than do other Canadians. One of the problems is that they can't get into the labour market and can't contribute to many of the social insurance benefits that we have, for example, the employment insurance sickness benefit or the Canada Pension Plan disability benefit, and, as a result, we have about 500,000 Canadians throughout the country who have to rely on welfare.[84]

Sherri Torjman, Caledon Institute of Social Policy

Employment statistics are staggering. Over 55% of working-age adults with disabilities are currently unemployed or out of the workforce. For people with intellectual disabilities that number goes up to 70%. These numbers are pretty staggering in a country as prosperous as Canada; frankly, they are appalling.[85]

Anna Macquarrie, Canadian Association for Community Living

h. Recent Immigrants and Visible Minorities

Poverty, as you hear over and over, doesn't affect everybody equally. I want to focus my comments on the fact that overwhelmingly one of the demographics that most experience poverty are immigrants, particularly more newly arrived immigrants and immigrants with refugee or refugee-like backgrounds.[86]

Jim Gurnett, Edmonton Mennonite Centre for Newcomers

Recent immigrants are more vulnerable to low income than other Canadians. The most recent Census found that immigrants who had arrived in the previous five years and who were in economic families had a low-income rate of 32.6% in 2005, while those who were unattached had a low-income rate of 58.3%. This can be compared to rates of 6.9% and 26.3%, respectively, among their non-immigrant counterparts.[87]

Over time, rates of low income among immigrants tend to decrease. This is evident in Census data, as well as in a recent study that found that immigrants who had been in Canada for one year had a low-income rate of 42.2%, compared to 30.3% among immigrants in Canada for 10 years (See Chart 1.11). The difference in low-income rates between immigrants and non-immigrants also decreases over time. The low-income rate of the 1992 immigrant cohort, for example, fell from 3.0 times the rate of the Canadian-born population in the first year in Canada to 2.2 after ten years. Although this trend persists, the 2002 and 2004 immigrant cohorts displayed higher relative rates of low income upon entry to Canada than cohorts in the 1990’s.[88]

Despite changes to Canada’s immigrant selection criteria in 1993 that led to a dramatic rise in the educational attainment of new immigrants, these individuals still encounter significant obstacles in finding employment. In 2008, unemployment rates among immigrants and non-immigrants were 7.1% and 4.9% respectively, while immigrants in Canada for five years or less had an unemployment rate of 11.8%, more than double that of the Canadian-born population. Moreover, the recession seems to have affected immigrants more severely: from 2008 to 2009, the unemployment rate increased from 7.1 to 10.0% among immigrants, and from 5.9 to 7.8% among the Canadian-born population.[89] Immigrants who do find employment also face a growing earnings gap. In 1980, immigrants who had arrived in Canada in the previous five years earned 85 cents for each dollar earned by their Canadian-born counterparts. By 2005, this earnings ratio had fallen to 63 cents for immigrant men and 56 cents for immigrant women.[90]

In 2004, the low-income rate for immigrants in Canada for one year was higher among skilled workers (42.4%) than among family-class immigrants (38.3%), while refugees had the highest low-income rate (54.7%). Of immigrants in the 2000 cohort who experienced chronic low income (in low income for four out of their first five years in Canada), 52% were skilled immigrants and 41% had a university degree.[91] The Committee heard that the reasons for this are multi-faceted.

Here's the challenge: in 1981, a principal applicant in the skilled worker class coming to Canada earned approximately $7,000 more than the Canadian average just one year after arriving here; in the year 2000, he was earning $4,000 less.

Meaningful economic engagement is the most significant challenge facing immigrants. Recent immigrants are doing worse economically than previous cohorts, despite higher education levels. Among recent immigrants—that is, those who have arrived in the five years between 2001 and 2006—64% have a post-secondary certificate, diploma, or degree, compared to 49% of Canadian-born adults, but 60% of these immigrants are not working in jobs for which they trained and were educated. The main common reasons for this underemployment or unemployment are lack of Canadian work experience, lack of recognition of foreign credentials, poor language skills, and other obstacles such as racism and discriminatory practices.

The impact of these obstacles to meaningful employment is that poverty rates for immigrants are the highest among all disadvantaged groups.[92]

Mario Calla, COSTI Immigrant Services

Research has found that individuals who belong to visible minority groups are also more likely to experience poverty.[93] One study revealed that visible minority immigrants were much more likely than other immigrants to live on low income, even after being in Canada for nearly two decades.[94] In 2004, 86% of recent immigrants living on low incomes were members of a visible minority.[95] Some witnesses who appeared before the Committee highlighted the importance of the relationship between belonging to a visible minority group and major social and economic indicators, including low income.

It is essential and critical to understand that racialized groups are vulnerable to poverty partly because of their racialized status. And unless we understand that and establish that very clearly, whatever strategies we use are going to be limited in terms of their impact on the experience of poverty.[96]

Grace-Edward Galabuzi, Colour of Poverty Campaign

Poverty is not colour-blind. Race and poverty are absolutely linked in Canada. It is well documented that the gap between rich and poor in Ontario is widening. What is much less well understood is that the impact of this growing gulf is being much more profoundly felt by racialized group members: aboriginal or [F]irst [N]ations people, communities of colour.[97]

Debbie Douglas, Ontario Council of Agencies Serving Immigrants (OCASI)

i. Low-Wage Workers[98]

You will know, of course, that children are poor because their families and mothers are poor, because they live in poor families. And work is not always the solution for such poor families. Close to half of low-income children have at least one parent who is in the labour force full time. When jobs are poorly paid and costs are high, then employment is often the cause of family poverty rather than its solution. Data show us that rates of working poor parents have been increasing over recent years rather than diminishing.[99]

Susan Prentice, University of Manitoba

In 2007, 31% of all low-income families were working poor.[100] The same year, 5.9% of working families lived on low incomes, down from 8.3% in 2000, and 5.6% of children in working families, about 334,700 children, lived on low incomes.[101] Most of the working poor have strong attachment to the labour market, with 76% reporting full-time, full-year work in 2001. These individuals earned, on average, $12.00 per hour, which was 50% higher than the highest minimum wage in Canada at the time. The working poor are more likely than their counterparts who are not on low incomes to be young; to be single, separated, divorced or widowed; to have a work-limiting disability; and to hold less than a high school diploma. Recent immigrants and Aboriginal people living off-reserve are also over-represented among the working poor population.[102] Witnesses told the Committee that it is increasingly hard for some working families to get by, due in part to the prevalence of low-paying jobs.

We estimate that there are just under 690,000 Canadians, approximately, who would be considered the working poor.... Forty-four percent of working-poor families have children. I don't have a breakdown in terms of single parent or dual parent. However, certainly we're seeing an increasing level of struggle even for dual-earner families.[103]

Sean Tupper, Department of Human Resources and Skills Development

Someone said earlier that workers are finding it increasingly difficult to keep poverty at bay. Some individuals who used to have decent jobs no longer are able to make ends meet. The problem is less evident in Québec than elsewhere in Canada, but even in Québec, we now see more and more working people who have to rely on food banks despite being employed.[104]

François Saillant, Front d'action populaire en réaménagement urbain

A study based on 2001 data found that work did not provide a significant advantage over benefit dependency for low-income Canadians.[105] Working poor families, however, are significantly more likely to escape low income in the long run. Over the period between 2002 and 2007, 1.1% of main income recipients in working poor families were living on low incomes all years, compared to 25.7% in non-working poor families.[106]

1.4 Relationship Between Poverty and Physical and Mental Health

Taking action on poverty is literally a matter of life and death. There is an overwhelming amount of evidence that those who live in poverty and are socially excluded experience a greater burden of disease and die earlier than those who have better access to economic, social, and political resources.[107]

Theresa Agnew, Registered Nurses' Association of Ontario

It is widely acknowledged that the circumstances in which people live significantly influence their physical and mental health outcomes. These social determinants of health[108] include such factors as work conditions, education, culture, and social connectedness. Income is also recognized as an important determinant of health and health inequities.[109] Research shows not only that the poorest Canadians have worse physical and mental health than higher-income groups, but also that overall health follows a clear income gradient: the lower a person’s income, the worse his or her health (See Chart 1.12).[110]

However, because income interacts with other determinants of health, as well as various mediating factors, its direct impact is difficult to isolate. Despite this, studies have attempted to determine whether a causal relationship between poverty and ill health exists. Researchers have looked at whether societies with greater income inequality have worse population health outcomes than other societies with more income equality.[111] While such an association has been demonstrated, the relationship is less evident when focusing on the Canadian context and remains a subject of debate.[112]

At the level of the individual, however, the relationship between income and health is better understood. On the one hand, an individual’s ill health can lead to low income by creating barriers that preclude him or her from accessing community services and supports, securing adequate education, and successfully participating in the labour market. These challenges can result in lower earnings and lead to situations of poverty.

On the other hand, studies that examine the relationship between an individual’s income and well-being generally conclude that the main direction of influence is from poverty to poorer health.[113] One explanation for this is material deprivation: low income may deprive individuals of such things as a nutritious diet or adequate housing and thus create conditions that are adverse to good health. A second explanation recognizes that lower income generally results in less control and discretion over life circumstances and may lead to fewer opportunities for social participation and for leading a fulfilling life.[114] Ultimately, both accounts may be correct. Thorough analysis indicates that “[i]t is likely that both material or physical needs and capability, spiritual, or psychosocial needs are important to the gradient in health.”[115]

The Committee heard from many witnesses about how the pathway into low income is experienced by people with mental illness. Poverty is also a significant risk factor for poor mental health and mental illness.[116] While mental illness can affect people at all income levels, people living on low income report worse mental health than those in higher income groups.[117] Research shows, more specifically, that the prevalence of depression among low-income individuals is 60% higher than the Canadian average,[118] and a study of social assistance recipients in Ontario found that suicide attempts were 10 times higher among this group than among the non-poor.[119] These are very troubling statistics.

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.[120]

Ruth-Anne Graig, Canadian Mental Health Association

[T]he reality is there's lots of data that shows the lower your income, the greater the incidence of mental illness. There's a bit of a chicken-and-egg issue there: your income may be down because you had the mental illness, but the reality is that there is a very clear linkage between income and mental illness. The Canadian community health survey, the one done by StatsCan [Statistics Canada], shows very clearly that socio-economic status and mental illness have a very strong linkage.[121]

Hon. Michael Kirby, Mental Health Commission of Canada

People living with mental illness die as a result of suicide at a rate 40 times greater than people with HIV/AIDS. This does not include the deaths that result from other health problems associated with mental illness, such as heart disease, addiction, and diabetes, all of which have poor prognosis for people living with mental illness. This number does not address the effects of poverty and homelessness on the under-serviced mentally ill who are consigned to a life on the street.

Immediate and swift action must be taken in order to address the pandemic of mental illness in this country.[122]

Carmela Hutchison, National Network for Mental Health

Indicators such as life expectancy and mortality also reveal to what extent low-income Canadians have poorer health than other groups. A recent Statistics Canada study found that the poorest 10% of the population had significantly lower health-adjusted life expectancy[123] than the highest 10%, a difference of 11.4 years among men and 9.7 years among women. The same study compared this income effect to the burden of all cancers.[124] Other evidence suggests that if the rate of premature death of the entire population was the same as that of the most affluent quintile, there would be a 20% reduction in premature mortality among Canadians, an effect equivalent to eliminating all premature deaths from cardiovascular diseases.[125] These health inequities were also identified during Committee hearings.

There is another new Statistics Canada report that says poverty is twice as bad as cancer in terms of causing poor health and early death. This report says poverty—and we would say the government policies that cause poverty—is robbing poor people of about ten years of their lives.[126]

Jean Swanson, Carnegie Community Action Project

Poverty represents a significant threat to the health of our population and to the sustainability of our health care system. Study after study has identified the negative impact poverty has on our health.... Life expectancy alone varies by 15 years, depending on the area in which you live in our province.[127]

Daryl Quantz, BC Poverty Reduction Coalition

Canadians living on low incomes are more likely than higher-income groups to have multiple chronic health conditions and to suffer disproportionately from certain ailments.[128] Low income is highly correlated with diabetes, for example: people with the disease have a rate of low income nearly twice as high as that of the general population.[129] The prevalence of diabetes among Aboriginal people, one of the poorest population groups, is at least three times higher than among the general population.[130] Aboriginal people also suffer from tuberculosis at an alarming rate. Witnesses told the Committee about other conditions that are experienced at a greater rate by Canadians living on low incomes, including heart disease.

The Wellesley Institute has released its own research,[131] which looks at some of the issues around income and poverty.... Among other things, we looked at 39 health indicators by income, and we found that the poorest one-fifth of Canadians, when compared to the richest one-fifth, have more than double the rate of diabetes and heart disease, a 60% greater rate of two or more chronic health conditions, up to three times the rate of bronchitis, nearly double the rate of arthritis and rheumatism.[132]

Michael Shapcott, Wellesley Institute

It is important to recognize that poverty can have health consequences across a person’s lifespan. Irrespective of their social status in adulthood, children who grow up in low-income families are more likely to experience poorer health as adults, including conditions such as high blood pressure, circulatory diseases and weakened immunity.[133] Evidence also points to the cumulative effect of low income: chronic poverty has greater negative health consequences than occasional episodes.[134] The pathway model shows how early experiences such as economic insecurity set individuals on life trajectories that influence their future physical and mental health.[135] The Committee was also alerted to a study that explains how the physiological consequences of low income in the early years can damage health in the long term.

A study from Cornell University[136] described how low socio-economic status takes its toll on health. In the first longitudinal study on the physiological effects of poverty in young children, researchers reported that the longer 13-year-olds had spent living in poverty, the less efficient their bodies were in handling environmental demands...they were suffering from more stress-induced physiological strain on their organs and tissues than other young people.[137]

Canadian Nurses Association

Not only do low-income Canadians have poorer physical and mental health than higher-income groups, but inequities also exist in health care access and utilization. People in the lowest income quintile are more likely than the average person to report unmet health care needs, are less likely to have a regular family doctor or to consult medical specialists, and spend a greater number of nights hospitalized each year. In addition, Canadians living on low incomes have less access to health insurance for costs not covered by the public health care system, including prescription drugs, dental care, eyeglasses, and additional hospital charges.[138] Since social assistance recipients are eligible for certain health benefits, the working poor are at a particular disadvantage.[139] Over the course of its study, the Committee heard calls for a national pharmacare program that would remove this disincentive and provide much needed assistance to the working poor.[140]

It is evident that reducing poverty would go a long way towards improving Canadians’ overall health and well-being, and witnesses urged the government to act on this important issue. Recent research also suggests that a federal poverty reduction plan could eliminate the negative health effects of poverty in Canada.[141] The Committee believes that every Canadian should have an equal opportunity to lead a healthy and fulfilling life, and that steps to reduce poverty must be taken if we want to eliminate health inequities.

While exercise, diet and smoking cessation are all helpful in promoting health, eliminating poverty would be the single biggest step forward Canada could make in ensuring the health of all citizens.[142]

Sid Frankel, Social Planning Council of Winnipeg

1.5 Food Security

Food security exists when all people, at all times, have physical and economic access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life.[143]

Food and Agriculture Organization of the United Nations, Rome Declaration on World Food Security and World Food Summit Plan of Action

At the World Food Summit of 1996, a summit convened by the United Nations’ Food and Agriculture Organization, three pillars of food security were identified: availability, accessibility and usage. They were defined as follow:

• food availability signifies that sufficient quantities of food are available on a consistent basis;
• food access means having sufficient resources to obtain appropriate foods for a nutritious diet; and
• food use is the appropriate use of food, based on knowledge of basic nutrition and care, as well as adequate water and sanitation.[144]

Similar themes were raised during the Committee’s hearings, where some witnesses spoke about the right to food security and a few referred to a broader notion of “food autonomy”.

Several years ago, we developed a vision which is separate from what is known as food security, something many people often misunderstand. We refer to food security from the standpoint of food unfairness or the response to food insecurity. We believe that the right to food is far more than that, and thus we prefer to talk about food autonomy. That food autonomy is based on four major thrusts: providing access to healthy food at a reasonable cost; giving people purchasing power and the ability to choose their food; respecting the principles of sustainable development and the environment; and, responsible consumption, now and for future generations.

Food autonomy is not something that exists at an individual level; it is not just a matter of developing individual skills. It also refers to collective action, and communities need to develop the means to respond to the right to food.[145]

Germaine Chevrier, Regroupement des cuisines collectives du Québec

Food security is a multi-dimensional issue that can be analysed from different angles. Within the context of the Committee’s study, witnesses focused on food insecurity as a consequence of poverty, a relationship that is well documented: “[w]hile the relationship between income and food security measures is not linear, data clearly indicate that household food insecurity is a product of poverty.”[146] While Canada is a world leader in the production and supply of high quality food, and the vast majority of Canadians are food secure, the Committee heard that food insecurity is often a reality for low-income households.

Issues around poverty are interconnected, and together they effectively jeopardize the enjoyment of many other rights, such as access to jobs, housing, and food security.[147]

Heather Kere, African Canadian Legal Clinic

A Health Canada report based on the findings of the 2004 Canadian Community Health Survey on nutrition[148] confirms that low income is indeed a significant contributing factor to food insecurity. More than 1.1 million households (9.2%) in Canada were moderately or severely food insecure at some point in 2004. Food insecurity was found to be more prevalent among those in the lowest (48.3%) and lower-middle (29.1%) categories of household income adequacy.[149] Almost 60% of households relying on social assistance experienced food insecurity that year, as well as 29% of those relying on income security programs as their main source of income (e.g., worker’s compensation and employment insurance).[150] In Ontario, research shows that most recipients of social assistance cannot afford to purchase the content of a nutritious food basket,[151] and a recent report on the cost of eating in British Columbia found that “a family of four on income assistance would need more than 100% of their income for shelter and food only.”[152]

Some groups are more at risk of experiencing food insecurity than others. In 2004, food insecurity was more prevalent among adults (9.0%) than children (5.2%). Female lone-parent households experienced food insecurity at a rate of 24.9% compared with households headed by a couple, which had a rate of 7.6%. Aboriginal households living off-reserve[153] were more likely to experience food insecurity (33.3%) than non-Aboriginal households (8.8%). Finally, people who did not own their dwelling were more likely to report having experienced food insecurity (20.5%) than those who owned their dwelling (3.9%).[154] It should also be noted that individuals within households may experience food insecurity differently. Research on the role of gender in addressing food security issues found that when access to food is very limited, mothers are more likely to feed their children first and often compromise their own health to protect that of their family.[155]

One of my clients, Ella, finds that her health, well-being, dignity, and rights are compromised by the constant stress of paying rent and finding enough left over from her minimum-wage job for food and other essentials. Ella feeds her kids first and often goes hungry herself. She used to worry that the food from the food bank wasn't nutritious, but now she's worried that there might not be enough food in the food bank each month when she goes.[156]

Theresa Agnew, Registered Nurses’ Association of Ontario

Food insecurity is exacerbated by low wages and the high costs associated with shelter and utilities, which leave families with less money for food. A study in Nova Scotia assessed the affordability of a nutritious diet for households earning the minimum wage and found that these households were unable to meet their basic needs and were more likely to compromise their dietary intake in order to afford other essential expenses.[157] This confirms what we already know: having a job does not necessarily mean that one does not have to worry about how to put food on the table and pay the bills.

Certainly there is a high percentage of people who rely on food banks, who are regular clients or regular customers. There is no question. However, increasingly we are seeing people who are using the food bank only periodically. And in many cases these are seniors. They're working poor, people who hold down a job or may hold down two jobs, but at minimum wage. You do the math, and you know you simply can't support your family and household on that income on an ongoing basis. So periodically they come to the food bank when they are unable to provide for their families, maybe due to an emergency that has come up, or it may be that the car has broken down, or there may be some other thing that impedes their ability to purchase food.[158]

Wayne Hellquist, Canadian Association of Food Banks

I have noticed that a lot of people cannot afford their food because of housing. Rent here is so expensive that most of the time the money goes straight to that. Especially when there is a rise in the rent, we see more people coming in. I also noticed that when school starts, it's hard to pay for all the clothing with winter coming, and school materials are needed as well.[159]

Julie Ménard, Food Bank Society of Whitehorse

The lack of food security in Nova Scotia is a huge problem, as evidenced by the proliferation and high usage of food banks here and the large number of women who seek help from our centres with meeting this need. As of 2004, the number of households experiencing moderate or severe food insecurity was estimated at 132,400, or 14.6 per cent of the population. Statistics Canada reports show that while the overall cost of living in Nova Scotia has not increased in the past year, the cost of food increased by 9.2 per cent and electricity by 17.7 per cent. Often women are forced to spend their grocery money on utilities, and seek other ways to secure food. These cost increases are felt painfully by women living in poverty.[160]

Nova Scotia Association of Women’s Centres

Geography also plays a role in food security as people face different challenges accessing affordable and nutritious food depending on where they live in Canada. People living in disadvantaged neighbourhoods may not have access to grocery stores, which typically offer more affordable foods and a greater variety of food items including fresh produce. With the suburbanization of food retailers in North America, inner-city neighbourhoods, many with a higher concentration of low socio-economic status households may also have increasingly poor access to supermarkets.[161]

Low-income households in urban centres may nonetheless have easier access to supermarkets than those living in remote or isolated communities. In these areas, nutritious food is less available, and the cost of a food basket is often out of reach for those living on low incomes. This reality particularly affects people living in northern communities who do not have access to fresh food items at a reasonable cost or on a year-round basis. Aboriginal people also have less and less access to traditional foods that are culturally acceptable, healthy and safe. The Committee heard firsthand about these issues from Canadians living in the Northwest Territories when it held meetings in Yellowknife.

One factor that drives up the cost of living is our transportation system. Perishable food has to be flown into many communities on a regular basis. Basics are shipped in via barge or sealift in the summer or by ice roads during the coldest part of the year.

[...]

Half our communities still don't have year-round road access. While we don't expect roads to all of our communities, improving transportation links is essential.[162]

Gordon Van Tighem, Northwest Territories Association of Communities

The other thing you might be interested in is that this Thanksgiving we got a picture of a turkey in Arctic Bay. It cost $200 to have a turkey for Thanksgiving. The milk cost $13 for three litres. The price was dropped on the turkey when CBC phoned the store and said, “What's that all about?” All of a sudden the turkey cost $90.

So there's a huge challenge around food in the north. There's more of a freight allowance or freight subsidy for junk food and for alcohol and lots of other things than for food. Issues around nutrition/malnutrition are really critical in the north.

There's also an assumption that traditional food or the hunting lifestyle is going to sustain families, but that's really changed over the years. Not only has it changed because families have changed, but the animal patterns have changed, the caribou patterns have changed. We're really concerned about the perception that people rely a lot on traditional food or wildlife to supplement their food.[163]

Arlene Hache, Yellowknife Women’s Society

The federal government has taken some steps to address the issue of food security in Canada. At the 1996 World Food Summit, Canada joined 186 other nations in supporting the goal of reducing the number of undernourished people by half by 2015. Two years later, the federal government launched Canada’s Action Plan for Food Security,[164] a plan to achieve food security domestically and internationally. Among the commitments identified in the document, and of particular interest to the work of our Committee, was the recognition that poverty reduction is essential to improving access to safe and nutritious foods.[165]

Municipal, provincial and territorial governments have also developed numerous programs and policies to address the issue of food security, including economic, social and environmental concerns surrounding food security.[166] The Government of Québec recognized food security as a key element of its poverty reduction strategy and invests an estimated $3.2 million annually towards food security initiatives. Most of the money (75%) is spent on programs to foster individual self-sufficiency and the rest (25%) goes to food banks, community kitchens and other emergency food resources.[167] Another interesting provincial initiative, among others, is the Air Foodlift Subsidy Program[168] established in 1997 in the province of Newfoundland and Labrador. The program provides subsidies that reduce the cost to retailers of transporting nutritious foods to isolated Labrador communities and thus makes healthy foods more affordable in northern regions of the province.[169]

Action to address food insecurity in Canada largely takes place at the community level. More and more low-income Canadians are turning to their local food banks for help, and the situation has further deteriorated with the economic downturn that began in the fall of 2008. Research shows that more than 790,000 Canadians—293,000 of whom were children—approached a food bank looking for help in March 2009, an 18% increase over March 2008. Provinces that were hit hardest by the recession saw the biggest upsurge over this period, including a 61% increase in food bank clients in Alberta.[170] While most of the clients relied on income support programs (e.g., pensions, disability-related income assistance, and social assistance), nearly 20% reported income from current or recent employment yet were still unable to make ends meet. About 9% of people assisted by food banks in March 2009, more than 72,000 individuals, were turning to a food bank for the first time.[171] Many people who testified before our Committee talked about the distress experienced by first-time food bank users, as well as the strain experienced by organizations that are struggling to meet demand.

As people face financial ruin, they rely on the services of the not-for-profit sector to receive very basic services. Faced with either paying rent or feeding their children, more and more families are forced to use food banks and community kitchens. Across the country, food bank usage is rising. In Toronto, according to the latest figures I've received from Daily Bread Food Bank, usage is up 15% year over year and is growing.[172]

John Andras, Recession Relief Fund Coalition

Even though food banks have been around for more than 20 years and have become quite good at soliciting and sharing food with those who need it, it remains that there are real limitations in the ability of food banks to meet the need for emergency food assistance. This is the larger point I would like to make today.

One figure that I think highlights limitations in food banks' ability to meet the need is the difference between the number of people who report not having enough food to eat and the number who are actually assisted by food banks. We know from the Canadian Community Health Survey of 2004 that 1.1 million Canadian households containing 2.7 million individuals reported being moderately or severely food-insecure, meaning that they had compromised quality and/or quantity of food consumed or had a reduced food intake and disrupted eating patterns. These 2.7 million people are about 8.8% of the population. I compare that with the fact that food banks serve about 2.2% of the population. In other words, there are a significant number of hungry people who are not being assisted by food banks.[173]

Shawn Pegg, Canadian Association of Food Banks

The Committee also heard that some food banks are moving beyond providing emergency food to offer other services that address the root causes of food security issues. For example, the Regina and District Food Bank is now offering training and education programs in an effort to provide a longer term solution to food insecurity among their clients.

As was mentioned, hunger and poverty is a multidimensional issue, and I don't think the solutions are simple either. We've been focusing our work at the Regina food bank on moving beyond simply providing emergency food to providing training and education for the people who use the food banks. We believe that in the long term the best solution is to ensure that people have access to employment, access to life skills training, access to employment training.

We've just finished a research project looking at the possibility of food banks becoming a labour force intermediary. We believe as well that food banks can be a unique portal to other agencies and other services in our community, including access to employment training and access to employment. We certainly need to find those kinds of unique and innovative solutions, utilizing not just food banks but other community-based organizations that can, I think, be part of the framework of helping to resolve this long-standing issue of hunger and poverty in our communities.[174]

Wayne Hellquist, Canadian Association of Food Banks

In addition to food banks, there are other relief strategies to food insecurity including soup kitchens, food-buying coops, school meal programs, and community kitchens and gardens.

The community kitchens concept was developed in 1982. It is important to understand that it grew out of the desire of two people living in poverty to take control of their lives and do more than simply receive gifts of food. So, the basic principle is empowerment.

This group was created in 1990 and now includes some 1,400 groups across the province and more than 37,000 people. Community kitchens were developed by five or six people who got together and pooled their money, skills and energy to prepare meals that they would take back home. Skills development and improved purchasing power are the fundamental principles behind the community kitchens concept.

[...]

We know that community kitchens are a means of helping people to save and reducing the effects of poverty while improving their lifestyles, that they have a major impact on people's physical and psychological health, and that they strengthen self-esteem and develop skills, as well as creating mutual assistance networks. These are ways of fighting poverty.[175]

Germaine Chevrier, Regroupement des cuisines collectives du Québec

One of the examples I was going to use involves a retail store in Winnipeg, which is an [A]boriginal worker co-op. They operate a retail store in the inner city of Winnipeg. It's a neighbourhood with a large[A]boriginal population and high rates of poverty and homelessness. The workers provide a grocery store for people where there isn't a store—we know about what are called food deserts. They promote healthy living and foods that will help with the incidence of diabetes in the [A]boriginal population. People are members of that store, and they feel a great sense of connection, more of a connection than with another kind of store.[176]

Lynne Markell, Canadian Co-operative Association

The Committee recognizes that food is a basic need and human right. All members are very impressed with the work being done by organizations across Canada to alleviate some of the food insecurity experienced in our country, work that is often done on a volunteer basis. Members of the Committee also understand the challenges non-profit and charitable organizations face in delivering services and how much more difficult this has become due to growing demand and rising food prices. We believe that community organizations are key players in the fight against hunger in Canada and that their work needs to be better recognized, better supported and better integrated through partnerships with various levels of government.[177] Food security in Canada can only be achieved if all stakeholders, including governments, private sector, non-profit organizations and concerned individuals work together towards the same goal of reducing poverty and hunger. A national coordinated approach to monitoring the cost of food and other basic living expenses against the income of Canadians is also needed if we are to devise successful policies to address income-related food insecurity over time.

1.6 Poverty, Housing and Homelessness

I think everybody would agree that housing, along with health and education, is a fundamental building block of civilized society in Canada and in all countries throughout the world. People who cannot afford the housing they need are obviously not going to escape the trap of poverty.[178]

Nicholas Gazzard, Co-operative Housing Federation of Canada

Members of the Committee believe that a place to call home is a fundamental need and a basic human right. Unfortunately, many people living in poverty are unable to meet their housing needs. Securing acceptable accommodation often requires that they spend a disproportionate amount of their household income on shelter, leaving little money for other necessities such as food and clothing. They may also be compelled to choose accommodation that is unsafe or unsuitable. Too many people who cannot afford decent housing also find themselves homeless.

In Canada poverty is largely a function of two things, income and shelter cost. Too many Canadians are forced to make unreasonable and unjust choices between shelter on the one hand, and such things as food, child care, and electricity on the other.[179]

Wayne de Jong, Habitat for Humanity Canada

Another cause of poverty is the lack of decent and affordable housing. People said that rents are so high there's not much left over to meet their other basic needs. Often, people said that families and individuals are sacrificing nutritious food in order to pay their shelter costs. We all know that safe, adequate, and affordable housing is a fundamental building block for societal well-being.[180]

Phyllis Mockler-Caissie, Poverty Reduction Initiative

While living on a low income can create housing challenges, a lack of adequate housing can equally prevent individuals from escaping poverty, keeping them trapped in situations of low income. Safe, reliable housing is often essential to securing employment, developing healthy relationships, caring for one’s physical and mental health and succeeding in school and work. Witnesses agreed that acceptable housing is an important precondition to escaping low income.

If somebody doesn't have housing, doesn't have a place to live—and I'm not talking about a shelter—nothing else matters. They're trying to get by each day, to survive in the environment of a shelter, to survive to get something to eat. If they have some housing, that basic little room, that apartment, then that starts to become the transition that takes place.[181]

Brian Duplessis, Fredericton Homeless Shelters

Decent and affordable housing provides an important foundation for healthy social, physical and mental development, and it has been argued that acceptable housing is a basic right that transcends economic or social status. Among other treaties and legal instruments recognizing the right to adequate housing, Canada is a signatory to the United Nations International Covenant on Economic, Social and Cultural Rights, which came into force in 1976. According to article 11 of the covenant, states that are a party to it “recognize the right of everyone to an adequate standard of living for himself and his family, including adequate food, clothing and housing, and to the continuous improvement of living conditions”.[182] In 2007, the UN Commission on Human Rights’ Special Rapporteur on adequate housing, Mr. Miloon Kothari, visited Canada and noted concerns “about the rise in the number of the homeless and people in inadequate housing and living conditions, rising prices in the housing sector affecting an increasing number of people with various levels of income, and the decrease in public housing”.[183] Many witnesses who appeared before the Committee maintained that housing is best understood and addressed in a human rights context.

As you know, a critical aspect of international human rights is the commitment to the right to an adequate standard of living, which includes the right to adequate food and adequate housing. So it's useful in the context of what we're talking about today that the international human rights framework links an adequate standard of living to adequate housing. You can't address one without the other, and I think that's true within a policy framework in Canada.[184]

Bruce Porter, Centre for Equality Rights in Accommodation

I'm referring to the rights contained in article 11 of the International Covenant on Economic, Social and Cultural Rights which include among other things the right to adequate housing and sufficient food. These are rights that are not being respected right now if you consider the poverty that surrounds us and the gravity of the housing problem.[185]

François Saillant, Front d'action populaire en réaménagement urbain

Unfortunately, many Canadians remain unable to afford decent housing. In 2006, 11.4% of Canadian households[186] lived in housing that cost more than 30% of their before-tax income, exceeding the Canada Mortgage and Housing Corporation (CMHC) affordability benchmark, and were unable to access accommodation that met this standard. The same year, 12.7% of Canadian households, nearly 1.5 million, lived in “core housing need,” a situation where a household occupies a dwelling that does not meet affordability, adequacy, and/or suitability standards, and cannot obtain acceptable alternative housing.[187] This can be compared to a rate of 13.7% five years earlier.[188] Housing affordability problems are compounded by low vacancy rates in many urban centres, as well as rising housing costs.[189] While the incidence of core housing need is highest in the territories,[190] witnesses who appeared before the Committee emphasized the fact that housing affordability is a challenge for Canadians across the country.

In Canada, the housing market, together with the existing affordable housing that we have, meets the housing needs of about 85% of the Canadian population. This is pretty good for them, but it means that about one in seven Canadians is left out. They cannot access housing at a price they can afford, and the market can't supply it at a price they can offer to pay for it. That's not a political opinion; it's just a question of economic fact.

It means that in Canada we see a disproportionate effect of housing costs on Canadian families. The average Canadian family spends 19% of gross income on housing, whereas the households in the lowest ten percentile of income groups in Canada pay fully 66%. You can well imagine that any household paying 66% to put a roof over their heads can barely afford the other necessities of life, let alone build a platform and a future they can rely on for self-determination in the future.[191]

Nicholas Gazzard, Co-operative Housing Federation of Canada

Quite simply, a lack of affordable housing is a major contributor to poverty, as many Canadians are paying more than 30% of their income on housing. In New Brunswick, there are 30,000 households that are paying more than 30% of their income on housing.[192]

Gary Glauser, New Brunswick Non-Profit Housing Association

In Ontario, one in five tenant households spends more than 50% of their income on rent. This means that there are over 260,000 households in Ontario that routinely choose to either pay the rent or feed the kids.[193]

Diana Summers, Ontario Non-Profit Housing Association

Certain population groups are more likely than others to face unsafe, inadequate and unaffordable housing conditions. The housing situations of many Aboriginal people in Canada are particularly worrisome. Over 20% of off-reserve Aboriginal households experienced core housing need in 2006,[194] and one in five Aboriginal dwellings across Canada required major repairs. The problem of overcrowding affects a significantly higher percentage of Aboriginal people than non-Aboriginal Canadians, and is particularly prevalent in Inuit communities and on-reserve, where the housing shortage is estimated to be between 20,000 and 87,000 units. A related concern is mould contamination, a serious health risk particularly in First Nations and Inuit housing.[195]

We have 320 members in our band and more than half of them live off the reserve because we don't have any housing. And it's inadequate housing as it is. We've got people all crammed and living together in a house. Some of the houses are extremely old. We have mould problems in our communities. We have leaky roofs in our community…[196]

Chief Fred Sampson, Nicola Tribal Association

Canadians with disabilities are another group that is particularly likely to face housing affordability challenges.[197] Over the course of its study, the Committee heard that much of Canada’s affordable housing stock is unable to accommodate the needs of people with disabilities, who are forced to pay more for barrier-free accommodation or choose housing without the supports they require. People with a mental illness also have difficulty finding and maintaining housing.

We heard that there is a lack of subsidized housing, a lack of housing options, particularly for persons with mental health issues and those with physical disabilities.[198]

Phyllis Mockler-Caissie, Poverty Reduction Initiative

I identified priorities for us. The first and foremost one that has come up in every discussion we've had, whether it has been with the NGO sector or with individuals themselves, is that there is a tremendous need in this country for adequate barrier-free safe and secure housing. It was unanimous.[199]

Rick Goodfellow, Independent Living Canada

The single most important thing for dealing with individuals with a mental illness, frankly, is more supportive housing. If you look at the Senate committee report, we recommended a very significant increase over a decade in supportive housing units. That would be number one.[200]

Hon. Michael Kirby, Mental Health Commission of Canada

Women also experience unique housing challenges as a result of economic, social and cultural barriers. Violence against women, a troubling problem in too many Canadian communities, is closely linked to women’s ability to access safe, affordable housing.

Women do become homeless for a very different reason than men do. Usually, it has to do with domestic violence, and they can't afford a place to go once they try to leave their domestic violence situation.[201]

Wendy Myshak, Homeward Trust Edmonton

Women leaving violent situations are at great risk of homelessness ... Lack of adequate affordable housing increases the likelihood that women and their children will return to violent situations.[202]

Beverley Wybrow, Canadian Women's Foundation

When I asked them to imagine a better situation, they're just looking for the best of a bad situation, so they may be staying in a relationship that's bad because they can't afford housing on their own and because they know, on the street with their child or moving from place to place, they're even more vulnerable...[203]

Nyingje Norgang, Victoria Faulkner Women’s Centre

In addition to the groups mentioned above, a CMHC study identified visible minorities and recent immigrants as groups being more likely to live in housing that exceeds the affordability benchmark.[204] There is also evidence of discrimination in the rental housing market on the basis of race and country of origin.[205]

When we look at housing, there are higher levels of under-housing and homelessness, with a re-emergence of what is being referred to as racialized residential enclaves, particularly within the city of Toronto but also in some of the other cities in Ontario.[206]

Grace-Edward Galabuzi, Colour of Poverty Campaign

The increasing racialization or colour-coding of all the major social and economic indicators can be gleaned not only from the statistics on income and wealth, but also from any one of a number of different measures, such as inequalities with respect to…under-housing and homelessness.[207]

Debbie Douglas, Ontario Council of Agencies Serving Immigrants

Furthermore, too many Canadians have no home at all. Unfortunately, there is insufficient information about the scale of homelessness in Canada.[208] On any given night, about 40,000 individuals stay in homeless shelters across the country, but estimates of the total size of the homeless population range from 150,000 to 300,000 people.[209] Many individuals experiencing homelessness are not visible on the street but reside in sub-standard accommodation or rotate between the homes of relatives and friends. The Committee heard that “hidden homelessness” is particularly prevalent in northern Canada.[210]

Homelessness is a pressing issue in Whitehorse, and the picture of homelessness in the north can be different from that in southern Canada. It can be hidden, with few visibly homeless people.…In the north it is typically experienced as unsafe, inadequate, substandard, couch-surfing, chaotic, unaffordable, and overcrowded. This is what homelessness looks like in the north.[211]

Patricia Bacon, Outreach Van

The past twenty years have seen both an increase in the number of homeless people and a change in the demographics of the homeless population. While homelessness has long been associated with single men with mental health and addiction issues, Canada’s homeless population now includes growing numbers of women, youth, and families, as well as Aboriginal people and immigrants. The Committee also heard that many people are newly homeless as a result of the economic downturn.

Front-line community agencies are seeing a new type of homeless people—those who, until very recently, were employed and who find themselves displaced and confused, angry and dismayed.[212]

John Andras, Recession Relief Fund Coalition

To put it in perspective, by the way, although nobody knows the exact number, somewhere around 50% of the people who are on the streets have a mental illness of some kind. A lot of them also have a substance abuse problem. The incidence of mental illness and homelessness is very high.

[…]

The incidence of mental illness among Canadians is going to increase significantly during the recession. It always does, because when people are suddenly out of work, they have a problem, there's a huge stress in families, and the impact on the family and children is very staggering.

Just to give you a couple of instances, in the first three months of this year, in Oshawa—and I'm saying Oshawa just because I happen to know the numbers—the number of people seeking help for mental health problems increased by 20% over last year. We know that in a place like Windsor, the numbers are substantially higher than that. We know it's also, unfortunately, having a very significant impact on children, because the impact of increased stress in the house as a result of layoffs—in some cases of both breadwinners—is such that it adds huge stress on the family and huge pressure on children.

So there is a clear linkage on the income side, and we have started to ask ourselves if there is anything that could be done to begin to look at trying to help reduce the impact of mental health problems on individuals during the recession.[213]

Hon. Michael Kirby, Mental Health Commission of Canada

Strategies for addressing Canada’s housing affordability and homelessness challenges are elaborated in Chapter 5 of this report.

1.7 Socio-Economic Costs of Poverty

And the choice is clear: we can pay to address poverty now or we will continue to pay for it massively and for generations. We pay for it through lost productivity, lost opportunity, and increased family violence. We pay for it through the health care system, our criminal justice system, and through growing demands on an already frayed social support system. We pay for it through the lost opportunities of children and their reduced life chances, employment opportunities, and the earning capacity of themselves and their children.[214]

John Campey, Community Social Planning Council of Toronto

Most people feel that poverty should be reduced on moral grounds: it is unjust and unacceptable that, in a country as wealthy as Canada, a significant portion of the population lives in poverty. Some people also suggest that reducing poverty makes economic sense: the economic benefits of reducing or eliminating poverty would exceed the associated costs, such as education funding or increased social transfers. Certain witnesses supported this point of view.

There are very few Canadian studies on the socio-economic costs of poverty. The Ontario Association of Food Banks (OAFB) recently looked into the subject.[215] A representative of the OAFB shared the study’s major findings with the Committee.

Poverty has a staggering price tag. As a function of increased remedial costs of health care and criminal justice, intergenerational costs, and lost productivity, the combined public and private cost of poverty in Canada ranges between $72.5 billion and $86.1 billion every year. The combined loss of provincial and federal tax revenues is $25 billion. Accordingly, investments in poverty reduction measures generate a significant rate of return.[216]

Adam Spence, Ontario Association of Food Banks

The cost of poverty lies primarily in increased government health care spending. People with lower incomes are in poorer health. There are several reasons for this: they are more likely to suffer from malnutrition and obesity, they have less access to prescription drugs as well as eye and dental examinations, and they have higher stress levels. The result is higher costs for the public health system. A second area of increased cost is crime. There is some relationship between on the one hand, education, literacy levels or success at school, and on the other hand, the likelihood of becoming involved in crime. Intergenerational poverty represents a third area of increased cost: children who live in poverty have a greater chance of being poor when they are adults. Reducing child poverty would result in a higher income for these individuals once they reach adulthood and increased government revenues. Lastly, the fact that some people with low incomes have lower skill levels or less education means that they are less productive and have lower wages. Increased skill levels would mean increased revenues both nationally (higher GDP) and individually, as well as higher government revenues and lower expenditures in the form of transfer payments.

According to the OAFB study, the estimated total cost of poverty in Canada is $72.5 billion to $86.1 billion: private costs accounting for $48.1 billion to $55.6 billion and social costs accounting for $24.4 billion to $30.5 billion. The total cost for Ontario is $32 billion to $38 billion, or 5.5% to 6.6% of Ontario’s GDP.

A less comprehensive study was conducted for the United Way of Calgary and Area. It concluded that the cost of poverty for Calgary ranged from $8 million to $57 million. These external costs consist solely of the costs incurred by people other than those living in poverty, and include increased costs for health care, education, justice, and social and income support.[217]

Other countries have studied these issues as well. For example, according to a recent U.S. study,[218] the economic cost of poverty related to lower output, increased crime and higher health costs is about $500 billion per year, or about 4% of the GDP. The authors believe this cost is understated since it does not include the direct costs of transfers or the intergenerational costs of poverty. Finally, a British study[219] demonstrated that the cost of child poverty is at least £25 billion annually, or about 2% of the GDP.

The methodology used in these studies may spark debate, and the cost of reducing poverty to the levels cited in the studies deserves careful thought. A greater redistribution of income or higher taxation to fund the necessary initiatives could cause some economic loss, particularly by decreasing incentives to work. The costs and benefits also depend on the approach taken to reduce poverty. Investments in education and early childhood development could lead to significant benefits, but they may not be felt for several decades. It is also difficult to make a connection between investments in education and improved incomes for senior citizens or workers nearing retirement. In these cases, larger transfers are needed. Although the full extent of the net benefits is unknown and depends on the approach taken to fight poverty, the Committee is of the opinion that reducing poverty would have long-term net benefits.

As many Scandinavian countries have shown, it is possible to have an effective labour market, very high productivity, relatively high public spending and lower poverty rates. These statistics are given in Table 1.6, and the Scandinavian example was cited by several witnesses.

It's a real frustration that the countries that have taken that longer perspective—the Scandinavian countries, in particular, where those investments have been made over a number of years—are now seeing a payback in terms of being among the most productive economies in the world, with the lowest poverty rates, highest literacy levels, and among those with the highest standards of living on almost every indicator of quality of life. Countries that have taken that long-term perspective and invested in the security of children and families have seen enormous dividends in their quality of life.[220]

John Campey, Community Social Planning Council of Toronto

Table 1.6 - Low-income Rates and Other Indicators, Selected Countries

Source: 1) United Nations Development Program, Human Development Reports, 2007–2008 Indicators, http://hdrstats.undp.org/en/countries/; 2) OECD, OECD Economic Outlook, No. 85, Table 25, http://www.oecd.org/dataoecd/5/51/2483816.xls; 3) The Conference Board, and Groningen Growth and Development Centre, Total Economy Database, June 2009, http://www.conference-board.org/economics/downloads/ted09I.xls