Canadian Social Research Links

Ottawa Poverty Reduction Network Meeting June 22, 2009
Speaking Notes - Gilles Séguin
THE FEDERAL ROLE IN POVERTY REDUCTION IN CANADA

June 28, 2009
Le 28 juin 2009


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By Gilles Seguin:

On June 22, 2009, the Ottawa Poverty Reduction Network invited community members living in poverty to participate in an information/action planning meeting about the latest poverty reduction initiatives happening across Canada, Ontario and in Ottawa. I was invited to sit on a panel and to speak about "the federal role in poverty reduction in Canada". My speaking notes appear below, along with some background and contextual information.

It was a real honour for me to sit on a panel with, and to listen to presentations from two of Ottawa's respected social justice champions (Hélène Ménard and Lynn Brown) and Jacquie Maund of Ontario Campaign 2000. I apologize if some of the content below is cryptic - they're my speaking notes, not a treatise.

Most of the information below comes from the Antipoverty and Poverty Reduction Links page of this website:
http://www.canadiansocialresearch.net/antipoverty.htm

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MY SPEAKING NOTES:

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What a difference 20 years makes!
Well, actually, not much.

In 1989, the House of Commons unanimously resolved to “… seek to achieve the goal of eliminating poverty among Canadian children by the year 2000.”
Today, the level of child and family poverty in Canada is pretty much where it was in 1989, despite an unprecedented period of strong economic growth since 1996.


*****************************************

THERE'S A WINDOW OF OPPORTUNITY

Renewed interest in poverty reduction in Canada.
(United Nations Millennium Development Goals - incl. poverty reduction)

- two Senate of Canada committees studying poverty
- one House of Commons committee

Even the Conservative members of those committees are speaking out in favour of a national poverty reduction strategy, based on the testimony they heard in their Committee hearings

Several provincial and territorial governments including Ontario are developing their own poverty-reduction strategies, and there are ongoing discussions about the issue in national, regional and local media.

********************************************


WHAT THE FEDERAL GOVERNMENT DOES WELL
AND NOT-SO-WELL IN THE AREA OF POVERTY REDUCTION:


Seniors’ benefits (Old Age Security, the Guaranteed Income Supplement and the Canada and Quebec Pension Plans - all programs launched in the 1960s and 1970s)

From 1976 to 2006, poverty among the elderly dropped from 29% to 5.4%.
(Some groups of seniors – such as unattached senior women – have much higher poverty rates)
Canada ranks third best among 23 industrialized nations in poverty among the elderly; only Scandinavian countries are better.


Child benefits

Since 1997, families with children receive the Canada Child Tax Benefit (CCTB) from Ottawa under the National Child Benefit (NCB) program.
The maximum federal benefit increased from $1500 per child per year in the first year of the program, to almost $3500 as of next month
Social groups have set a maximum $5,000 CCTB as the child benefit target.

Without the federal benefit, the family poverty rate would be 15%
With the CCTB, the rate is 9.3%
With a $5000 CCTB, the rate would be 8.3%

The 2009 federal Economic Action Plan includes measures such as
* Employment Insurance Maternity and Parental Benefits for the Self-Employed
* Increases to the National Child Benefit Supplement and Canada Child Tax Benefit
* Personal Income Tax Relief for All Taxpayers

Help for the working poor

In 2007 the federal government created the Working Income Tax Benefit, a program that supplements the earnings of the working poor.

Maximum benefits were low in the first two years of the program and only those working poor employed part-time or part-year could qualify. The 2009 Budget almost doubled the
Working Income Tax Benefit for single recipients (from $510 in 2008 to $925 in 2009), and it went up by 50% ($1,044 in 2008 to $1,680 in 2009) for single parents and couples.

One of the initiatives under the Economic Action Plan is Enhancing the Working Income Tax Benefit:
- The enhancement will provide additional tax relief of $580 million for 2009 and subsequent taxation years.
But only if you have income from work.


Employment Insurance

Employment Insurance (EI) in Canada is a mess.

Nationally, coverage of the unemployed has fallen from 83 percent in 1990 to 47 percent in March 2009 (36% for Ontario) - the lowest ever.
In large centres, it's worse. In toronto, only one in four unemployed people qualify for Employment Insurance.

It tends to exclude the long-term unemployed, recent immigrants, the underemployed, new workers, part-time workers and workers in precarious jobs.
In fact, most low-wage workers (including the self-employed), are excluded from Employment Insurance.

Benefits are low - when you take inflation into account, the maximum weekly benefit of $447 in 2009 is just three-quarters of what it was in 1995

---

Recently, the Prime Minister and Leader of the Opposition created a working group of Conservative and Liberal MPs to look into possible improvements to EI during the summer and to report back to Parliament.

The positive view on this is that Canadians *might* see some changes for the better in the EI program in the near future. The negative view is that the working group will either fall apart along political party lines, or it will produce a report that is sure to trigger a federal election in the fall.

And by the way, the EI fund surplus held by the Government of Canada was $57 billion in 2007-2008.

***
Changes under the Economic Action Plan to the current EI system include:
* eliminate the two-week waiting period for benefits
* extend the maximum benefit period
* establish uniform eligibility requirements (# of hours)
* and so on


***

Housing

The Canada Mortgage and Housing Corporation estimated that as many as 1.5 million Canadians are currently experiencing core housing need, meaning that they are under-housed or face an unsustainable financial burden to maintain their current housing situation.

Canada is the only major industrial nation still without a national affordable housing strategy.

A few years ago, a United Nations Housing Envoy found a “national housing crisis” in Canada. He recommended that the federal government needs to commit stable and long-term funding and programmes to realise a comprehensive national housing strategy; and a comprehensive and properly-funded poverty reduction strategy based on Canada's human rights obligations.

The Economic Action Plan:
Canada’s Economic Action Plan provides a total of $7.8 billion for housing, including more than $2 billion through CMHC to build new and renovate existing social housing, for more than 200,000 Canadian households. This will include $400 million for housing for low-income seniors.


- one-time $1 billion injection (with matching dollars from the provinces) over the next two years for renovation and energy retrofits to improve the quality and energy efficiency of up to 200,000 social housing units throughout the country. Critics say that the stimulus package gave tax breaks to people who build decks at their cottages, and pave their driveways but not $1 dollar for new affordable housing.

The 2009 federal Budget also allocated targeted funds ranging from $75 million to $400 million over two years for First Nations reserves, seniors, the North and persons with disabilities.


The Harper Record on Housing:

· Since become Prime Minister, Harper has been steadfast in his refusal to support a national housing strategy.
· Has continued the housing policy of the last government that locked in a decreasing annual budget for housing.

Groups are calling on the federal government to :
· Maintain the current investment in affordable housing
· Meet Canada's international housing obligations by adopting a comprehensive and fully funded national housing program.
· Establish a minister responsible for housing, with wide?ranging mandates and responsibilities.
· Increase the availability and accessibility of money in the stimulus package and Build Canada fund for use by the Provinces for repair of existing social housing and the construction of new affordable housing


***

Early Learning and Child Care

Canada is far behind other advanced nations when it comes to early learning and child care - we're tied with Ireland for last place among 25 so-called advanced countries in a recent survey of early childhood care and education

Canadians need good-quality, affordable child care in order to participate in the labour market.
Canada needs a national child care program.
Period.

Childcare has become a political football game that all the parties in the House of Commons play.
- For 13 years under Chretien and Martin the Liberals talked about a national childcare policy at election time, followed by excuses about “deficit fighting” and did nothing.
- In 2005 the NDP helped Harper defeat a national childcare policy for its own partisan political ends according to some groups
- Harper has re-introduced the Baby Bonus (which benefits affluent Canadians the most) - the Universal Child Care Benefit ($100/child/month) - and called it a national childcare policy.

Somebody forgot to tell the Conservatives that day care costs more than $100 a month, and that working parents with kids over 6 years of age ALSO need help with day care.


***

Disability income

Under Canada's Economic Action Plan, the federal government is providing
$75 million over two years to build housing units for persons with disabilities.

The Registered Disability Savings Plan is a savings plan designed specifically for people with disabilities in Canada. The first of its kind in the world, this new tax-deferred savings vehicle will assist families in planning for the long - term financial security of their relatives with disabilities.


BUT
An estimated half million Canadians with disabilities still rely on provincial and territorial welfare programs for their income. As a result of welfare reforms in all Canadian jurisdictions starting in the mid-1990s, welfare caseloads were cut in half and the vast majority of able-bodied clients were "liberated from the shackles of welfare", to quote Mike Harris in 1995.

Persons with disabilities, including those with multiple barriers to employment, now make up close to half of the social assistance caseload throughout the country.
That's unacceptable.

Canadians with disabilities need a national disability insurance program, like the Old Age Security System, and with benefit levels similar to the Old Age system ($5000+ more than welfare)

****

Urban Aboriginal People and Poverty

The federal government has jurisdictional authority for all Aboriginal people, and it exercises that authority via the Indian Act, which focuses on status Indians living on reserves and on the Inuit living in the far north. The connection between the federal government and other Aboriginal groups, such as the Métis, Aboriginal Women and urban Aboriginal people has been less consistent and evident.

Through Canada's Economic Action Plan, the federal government is investing $20 million over two years to change child and family services on reserves. The federal plan also includes $100 million in federal funding for the Aboriginal Skills and Employment Partnership (ASEP) program and $75 million of new funding over two years to establish the Aboriginal Skills and Training Strategic Investment Fund.

According to the
ONTARIO FEDERATION OF INDIAN FRIENDSHIP CENTRES:

"The causes of poverty in the Aboriginal community are so distinct from all other groups experiencing poverty in Canada that we feel there is a need to develop a distinct Aboriginal Poverty Reduction."

***

New Canadians

* Ethno-racial minority group members (people of colour) make up over 13% of Canada’s population; by the year 2017, this number will rise to 20%.

* Nearly one in five immigrants experiences a state of chronic low income --- more than twice the rate for Canadian-born individuals.

* Thirty-four per cent of children in racialized families, and 49% of children in recent immigrant families in Canada live in poverty.

No new Economic Plan measures specifically for new Canadians, except for accelerated recognition of professional credentials from their country of origin and other measures that apply to all Canadians.

***

Federal Contributions to provincial welfare
and the Federal Role in Poverty Reduction

A few weeks ago, the federal govt told the United Nations Human Rights Council that initiatives to address deep and persistent poverty and income inequality in Canada are mostly the responsibility of provinces and territories (and not the national government).

Over the years, Canada has signed a significant number of international human rights treaties that are legally binding in international law, but the Harper Government's position on that is "Hey - just because some old dudes got together back in the 1950s and made some international human rights commitments doesn't mean that we in 2009 should feel bound by those commitments." A position like that undermines Canada's credibility in the international community, because it makes other world govts wonder what*other* international covenants and agreements Canada might welch on in so many other areas.

BOTTOM LINE:
Canada *must* be accountable for its international commitments in human rights.
Our international reputation depends on it

The Harper statement that provinces are responsible for initiatives to address poverty and income inequality may be true under the Canadian Constitution, but the feds have used their own constitutional spending power over the years both to create many national social programs - Old Age Security, the National Child Benefit, etc. - and to influence provincial programs to move in certain desired directions. The relevant example in this respect is the Canada Assistance Plan, the federal-provincial-territorial cost-sharing program that enabled the federal government to share 50% of provincial-territorial welfare costs. [ More information about the Canada Assistance Plan ]

The federal government sends billions of dollars each year to provinces and territories in a lump sum known as the Canada Social Transfer or CST, as its contribution to provincial costs related to social assistance or welfare. However, the lump sum also covers post-secondary education, social services, and early learning and childcare, and the provinces are free to re-allocate amounts among those components as they see fit. The result is NO accountability by provincial governments to the people of Canada (i.e., Parliament) with respect to federal dollars for welfare programs.

The federal govt must establish a national standard of accountability by prov. govts for the money it spends on provincial welfare programs, and the best way is to create a dedicated federal fund specifically earmarked for provincial welfare. There *was* such a national standard in place from 1967 until 1996: it was called the Canada Assistance Plan.

There was a big squabble some years back as the federal and provincial governments couldn't agree on the amounts that each level of govt was spending on health care. That's because, in 1996, Ottawa had replaced the Canada Assistance Plan and its detailed reporting requirements - including an annual report to the people of Canada in the House of Commons - with the Canada Health and Social Transfer, a block transfer that included the federal contribution to welfare AND Medicare AND post-secondary education.

The federal govt's solution was to hive off the Canada Health Act into a separate fund called the Canada Health Transfer, which required the provinces to report separately on their health care costs. As for welfare, it was folded in with post-secondary education and social services under the Canada Social Transfer in 2004, where it remains today. It's truly mystifying to me why the federal govt, which likes to get its share of the credit for its share of spending on social programs, doesn't just create a new Canada-Assistance-Plan-like mechanism to allow for public disclosure of exactly how much each province is spending on its welfare programs.
[Or maybe that would look too much like "federal involvement in a field that's under provincial responsibility..."]


***

THE FEDERAL ROLE IN ONTARIO'S POVERTY STRATEGY

According to Ch 7 of Breaking the Cycle, the Ontario govt's blueprint for poverty reduction, the success of the provincial initiative will require the following support from the federal govt:
* increase support to the NCBS and WITB programs
* address the shortcomings of the present EI program
* sign agreemnts with provinces in support of quality child care
* renew the Affordable Housing Program (due to end in 2010)
* work together with Aboriginal groups to improve the quality of life of Aboriginal people

***

A FALL FEDERAL ELECTION??

- likely to be triggered when Parliament reconvenes after summer recess, because of anticipated disagreement on proposed reforms to the Employment/Unemployment Insurance program or some other matter on a non-confidence vote.

The choices:

Stephen Harper, who just stated on an international stage that poverty is a provincial, not national, responsibility. Conservatives didn't propose any poverty-reduction plan in the 2008 election and are not expected to do so the next time.

In the 2008 election, Stephane Dion promised would reduce the number of Canadians living in poverty by at least 30 per cent and cut the number of poor children by half within five years. We know what happened to Mr. Dion. Michael Ignatieff, Liberal leader since the end of 2008, hasn't really told us yet how the Liberals would tackle poverty under his leadership. More to come on that.

In the the 2008 election, the federal NDP promised to introduce a Poverty Elimination Act to end poverty by 2020, with a goal of cutting overall poverty by 35 per cent and halving child poverty within five years. Jack Layton is still NDP leader, so it's possible that same offer will be on the table in the next election

In 2008, Elizabeth May of the Green Party promised ("if elected"), to introduce a new Guaranteed Liveable Income to ensure no one lives in poverty and to eliminate income taxes for those earning less than $20,000 annually. The Greens didn't elect anyone in 2008, so Ms. May didn't have to provide more detail on the "bare subsistence levels" that would make up the liveable income. The right-wing Fraser Institute in Vancouver is a strong promoter of guaranteed annual income, but, like the Green Party's guaranteed liveable income promise, the Devil's in the details...

What YOU can do:

Get informed.
There's a world-wide movement to reduce poverty, and it has sparked interest in a national poverty reduction strategy in Canada.
"Window of opportunity"

Get involved - by attending meetings like this one.

Get in touch with your MP to let him or her know that poverty reduction is important for ALL Canadians.

Make your vote count for social progress in Canada.

 

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WHAT WOULD A NATIONAL
POVERTY REDUCTION STRATEGY LOOK LIKE?

Solving Poverty: Four cornerstones of a workable national strategy for Canada
Winter 2007
"(...) When the National Council of Welfare started looking into anti-poverty strategies, it became quickly apparent to us that if there is no long-term vision, no plan, no one accountable for carrying out the plan, no resources assigned and no accepted measure of results, we will continue to be mired in poverty for generations.

The four cornerstones:

1) creating a national anti-poverty strategy with targets and timelines;
2) developing a coordinated plan of action;
3) ensuring accountability; and
4) establishing official poverty indicators.

Source:
National Council of Welfare
The National Council of Welfare is an arm's length advisory body to the Minister of Human Resources and Skills Development on matters of concern to low-income Canadians.

***

Key Challenges

- Canada has yet to adopt an official poverty line or other benchmark by which to measure the extent of poverty in the country (need for more information on the actual living standards of Canadians living in poverty or at risk of poverty).
- the sharing of constitutional powers within Canada’s federal system makes it more difficult to develop and implement an integrated approach to the reduction of poverty and social exclusion.

BUT joint action on the part of the federal and provincial/territorial governments is required to significantly reduce poverty in Canada.

Source:
Poverty Reduction in Canada - The Federal Role
Parliamentary Library
23 October 2007

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Quotable quote:

"It is high time we engage in a national campaign, in provincial campaigns and municipal battles where poverty is at the centre of the debates and competing platforms."
- Hugh Segal, Conservative senator

(Queen’s University School of Policy Studies, International Institute on Social Policy, Kingston - August 20, 2008)

 


- Go to the Anti-poverty Strategies and Campaigns page: http://www.canadiansocialresearch.net/antipoverty.htm



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