Thank you for the invitation to present here today.
I am speaking to you from Toronto, which is covered by Treaty 13 with the Mississaugas of the Credit and is the traditional territory of many other nations.
My name is Elizabeth McIsaac. I'm the president of Maytree. We're a private charitable foundation that works to advance systemic solutions to poverty and strengthen civic communities. We believe the most enduring way to fix the systems that create poverty is to ensure that economic and social rights are respected, protected and fulfilled for all people living in Canada.
At Maytree we've focused our policy and research efforts on income security and housing. As the committee undertakes its study of inflation in the current Canadian economy, I want to focus my remarks on two elements of that study: the rising cost of housing and the rising cost of food, and how they impact those who experience poverty.
For people who are living in deep poverty, by which I mean those whose income is less than 75% of what the Canadian government defines as the poverty line, the margins of a monthly budget are excruciatingly tight. Expenses to cover the basic essentials of food and shelter often exceed income. Even a slight cost increase can cause significant hardship and risk to life and dignity.
Results from a survey of food bank users tell us that food bank clients on average spend 53% of their monthly income on rent and 20% on food. As prices in these two categories soar, there will be no room to manoeuvre, particularly when the total monthly income is less than $1,000. When it's less than $1,000, you can imagine that every percentage point counts.
Welfare incomes in Canada, which include social assistance and income-tested tax credits, are inadequate and stagnating. In fact, the real value of social assistance and disability benefits has been falling steadily in some jurisdictions, like Ontario. While benefit rates increased slightly in 2020 as a result of pandemic-related benefits, these benefits were not extended into 2021, so it is likely that social assistance recipients will have had a decrease in their welfare incomes in 2021 and also as we go into 2022.
To be clear, though, the additional benefits that were available to people on social assistance were minimal. People receiving social assistance were still living well below the poverty line, in what is called “deep poverty”.
When we combine this reality with the current and projected inflation, without additional support the level of poverty people will experience will only deepen going forward.
As is common knowledge, and as you are hearing from across this panel and from others you have been listening to, we are in the midst of a housing crisis. For whom this is a crisis and at what cost depends on who you are and what your income is. The rising cost of rent is leading to significant housing insecurity. I would like to focus on the very affordable end of the housing spectrum, where we indeed have the most serious crisis.
According to analyses by Steve Pomeroy, between 2011 and 2016 the number of private rental units that were affordable to households earning less than $30,000 per year—that is, rents below $750—declined by 322,600 units, and this trend is continuing. At the same time, investment in the affordable housing program, together with unilateral provincial initiatives, mainly in B.C. and Quebec, have added fewer than 20,000 new affordable units.
The math is this: For every new affordable unit created, 15 existing private affordable units were lost. This is in the very deeply affordable category. For the record, when the average social assistance across Ontario is $1,000, $750 doesn't leave a lot of wiggle room.
The policy and program tools currently in use render our efforts to develop affordable housing moot. We're losing more affordable housing units than we're creating.
Deep affordability in the market requires government intervention. There is not a market-only solution for this. Enabling the development of affordable supply through programs like the co-investment fund is necessary, so that social housing providers and developers are able to leverage this opportunity. It must be adjusted to include greater grant support as part of that package, as well as rates, timing and access that make it doable.
People living in deep poverty are not contributing to what's driving inflation, but they will bear the brunt of it in the most personal and life-threatening ways.
As such, the Government of Canada must not use inflation as an excuse to forgo the government's duty to make income transfers to people living in deep poverty. In fact, the government needs to do the opposite. There remains a duty on the part of government to protect their right to life and to an adequate standard of living.
With respect to housing, this government has already expressed its intention to increase spending on that as part of its national housing strategy. This is essential. Within this investment, it will be imperative that deeply affordable housing and the human right to housing are prioritized. The lack of focus on developing deeply affordable supply has been acute and severely damaging.
Thank you for your time this morning. I'm happy to answer questions that the committee may have on the impact of inflation on people living in poverty and the opportunity for governments to address this.