My presentation will be in English, but please feel free to ask your questions in either French or English.
I'd like to thank the members of the committee for having us here. I'm with Garnett Picot. He's the director general of the analysis group, and he's the one who can give you more details on some of the findings in the detailed studies, if you're interested.
As has been mentioned by Mr. Fedyk, Canada doesn't have an official measure of poverty, and there's no international standard on the definition or measurement of poverty either. Statistics Canada has always maintained that it is not the role of a statistical office to define and measure poverty; we could lose a bit of the neutrality that is part of the agency.
While there's no consensus on the measure of poverty in Canada, in the early 1960s, Statistics Canada realized there was a need to have something that would show what's happening at the bottom of the income distribution. So since the early 1960s, we've been producing statistics on what we call the low-income cut-offs, the LICOs.
In the supplementary slides at the end of my package, I talk about the LICOs and the LIM, and I give background about what's done in other countries for poverty measurement. But for the sake of simplicity, the LICO is basically spending, on average, 20% more than the average family on food, shelter, and clothing. That's the basic methodology behind the LICO.
We use two kinds of incomes to calculate how much income you need. We calculate a total income before taxes and a total income after tax. We suggest you use the total income after tax because it takes into account the two mechanisms that are used for government for redistributing income, and those are taxes and transfers.
We produce these rates on an annual basis. We also produce the low-income measure. The low-income measure is half the adjusted median income. This measure is usually used for international comparisons. It's a relative measure. It has different statistical properties. So it's not a measure that we feature prominently; it's more something that we use to compare Canada with other countries in the world.
Since the late 1990s, HRDC has produced an alternative measure to our current LICO methodology. It was trying to address two limitations of our current LICO methodology. One is having more detailed geography, and the second is having more of an absolute measure of low income.
While that measure is relatively new, I'll present trends with the LICO and with the MBM, to put the two measures in context.