Human Resources Committee on April 10th, 2008

[Sylvie Michaud]

But we do have some numbers for low-income single-parent males and single-parent females. We can provide you with those.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Oh great. I'd appreciate that.

[Ruby Dhalla, Liberal, Brampton—Springdale, ON]

Thank you very much, first of all, to all of you for coming here. Your presentations were extremely insightful and helpful, and I think a great start to what is going to be a very important study.

I wanted to touch on the first presentation that was given on poverty in Canada. I was quite alarmed by some of the statistics, where it states that Canada has a low-income rate comparable to Ireland, New Zealand, the U.K., and Australia, and a lower rate than the U.S.

What do you think are some of the contributing factors to those statistics?

[Frank Fedyk]

It varies very much in terms of the income security systems that are available, as we highlighted in all the presentations. In terms of seniors, we have a very generous income security support for seniors.

Another issue, in terms of the Canadian situation, is that we have a large measure of supports for our low-income population, getting at the root causes.

In terms of what the Americans are doing, I can't elaborate on that, but I can say that the efforts of all governments have been to target measures in terms of the needs of the low-income. So what we've noted is that through targeted measures we've been more successful in moving some of our trends down.

[Doug Murphy]

I would add, and I think Garnett and Sylvie will support this, that you do see a kind of clustering on the Anglo-American-type countries' market economies. There is convergence there. The U.S. is higher, using half of median income. But you see a pretty comparable rate between Canada, Australia, the United Kingdom, and Ireland in terms of about 12% or 10% of half-median income people living in low income.

[Ruby Dhalla, Liberal, Brampton—Springdale, ON]

Thank you.

The other point you indicated in your presentation was on the key targeted initiatives. You were talking about income support measures that are provided for the demographic. You mentioned the homelessness partnering strategy.

I think you probably know that funding for the homelessness partnering strategy is going to expire very shortly. Have you made recommendations to the minister and to the department with regard to its renewal?

[Frank Fedyk]

Obviously those issues of where we're going with the programs are up to the government to determine. We'll support them with the information they require in terms of that decision.

[The Vice-Chair, Liberal, Michael Savage]

Thank you.

We will move to the Bloc.

Monsieur Lessard, sept minutes.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Thank you Mr. Chairman.

I would also like to thank the witness and congratulate her for her presentation this morning. I had a series of questions that have already been answered, in fact, quite eloquently, so I have had to rethink my line of questioning.

I have a question that each one of you may wish to answer. I find it rather astonishing that with all of the research, all of the work that has been done on poverty, there is still no specific definition of the poverty threshold, even though I acknowledge the variables that you have so clearly demonstrated. Will this problem always exist or would it not be possible, in view of current knowledge, to clearly define a threshold? It would certainly go a long way in helping us find the appropriate solutions to the problem. Do you have an answer?

[Frank Fedyk]

Yes. As you rightly pointed out, there is no unanimity among researchers, policy advisors, or, I would even say, governments, as to what poverty is and how best to measure it. That's why most countries, like Canada, have developed this suite of measures that allow for different types of analysis in different programs. As our colleagues have elaborated, the low-income measure is best for international comparisons because everyone collects income data and it is relatively easy to look at average incomes.

We have also highlighted to our colleagues at Statistics Canada the advantages of regional distribution. The cost of living varies enormously across Canada. We would say that the market basket measure has distinct advantages of being able to look at the community situation where the low-income individual, or family, is living and better target measures that would address their particular needs.

Finally, because the LICO is our historical database, it is best in terms of being able to study trends. I think it's an enormous challenge for any government to say that one measure is the one measure we should go with. I think there are advantages to having multiple measures. As our colleagues have pointed out, most countries have multiple measures.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Studies in the United States had shown that child poverty can lead to $500 billion in economic and social costs. You are probably aware of those studies. Has anything similar been done in Canada? Earlier, Ms. Regehr spoke about social costs, and what that can lead to. I would like to know if a similar study has been done in Canada.

[Doug Murphy]

Nothing comes immediately to mind in terms of putting a dollar figure on the cost of child poverty. There's been a lot of work in terms of some of the social and emotional outcomes for children living in low-income families. But we can certainly look into that.

As Garnett pointed out, it is important in terms of the intergenerational transmission of low income. Adult children who were raised in low-income families tend to do pretty well. I don't know how good a proxy that is, but it is worth noting that Canada does well internationally on that front.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

I think that I may have just raised two key points for our study. First, what is the real poverty threshold, and what are its social costs? I think these two areas could help us direct our work.

There is another aspect which is not new but which is becoming more and more apparent: there are people who have regular jobs, who are employed full-time, etc., but who are nevertheless poor. I think this phenomenon is on the upswing.

And there is another phenomenon. I may be wrong, but I don't think the highest number of people living in poverty are necessarily located in the poorest regions, where the economy is weaker. For example, in Alberta, where employment is the highest, there are still people resorting to using the food banks.

Do you know what type of workers are living in poverty, when it comes to their income, etc.?

[Doug Murphy]

We have some detail on the working poor. This is an issue, because it's not just low income. The working poor tend to lack the types of services that other workers are more likely to get, such as dental plans and disability insurance. So there is a compounding effect. It's not just the income they don't have; it is also the lack of these benefits and services that support them.

In terms of what industries they're in, I'll just have to look at some material. We've done a fair amount of work in our department on the issue of the working poor. We could certainly provide you with the results of that research. It is an issue within the department.

[Frank Fedyk]

Very much they tend to be in the minimum wage service sector, and we have more detailed studies we can provide.

[The Vice-Chair, Liberal, Michael Savage]

Thank you, Mr. Lessard.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

I have a simple request to make. What type of job is it and how much do the workers make? Are these necessarily people who are earning minimum wages?

Could you tell us how many in that group earn more than $10 an hour?

[The Vice-Chair, Liberal, Michael Savage]

Thank you. I'll give you a few seconds if you want.

[Garnett Picot]

Regarding earnings, when I think about low income, I think of three components or three background areas. One is what is going on in the labour market. Second is what the state is doing to the tax transfer system. Third is demographic change, which also can affect low income. Of those three, probably what's happening in the labour market has been the most important. It is true that although GDP has been rising--we've been in an economic boom for a while--earnings at the bottom end of the earnings distribution really haven't risen. If anything, they've probably fallen a little bit. That's the real puzzle. That has a lot to do with why we haven't seen the low-income rate fall. Our low-income rate is still where it was 20 years ago. That's really what's happening at the bottom of the earnings distribution. It's what's happening in the labour market with respect to earnings. That's a big part of the story.

[The Vice-Chair, Liberal, Michael Savage]

Thank you very much.

We will now move to Mr. Martin, for seven minutes.

[Tony Martin, NDP, Sault Ste. Marie, ON]

Thank you very much. I do appreciate all the really good information that was put in front of us here today.

One of the first challenges that I think we're going to have to grapple with, and that has already been identified by the committee, is this question of how we measure poverty so that we're all sort of singing from the same hymn book and trying to deal with the same issue. I think you've laid out how complicated an issue it is and how difficult it would probably be. But we're getting there.

There are, as you said, different approaches in different jurisdictions that work fairly well, but we in Canada have not.... Has there ever been a serious attempt at actually defining poverty, bringing forward a measurement that we could all sort of agree with?

[Frank Fedyk]

Researchers have done all kinds of work on the issue, but it's more a government decision. In those countries like the U.K. and Ireland that have chosen to identify a particular measure, it was a government decision.

So I think the advantage of what Canada as well as other jurisdictions have done is that we have provided a basket or a range of measures that the government could use, and they're all using them toward helping to make the best choices in terms of the design of programs and benefits for them.

Regarding Quebec and Newfoundland—from what I understand, Quebec is using the international low-income measure.

[Sylvie Michaud]

The MBM. They're going for the MBM.

[Frank Fedyk]

As well, Newfoundland is considering the MBM in terms of its targets for moving forward. So it seems each jurisdiction needs to make its own choice in terms of how it decides against what its anti-poverty strategy would be used to measure progress.

[Tony Martin, NDP, Sault Ste. Marie, ON]

It seems to me that we need to be working cooperatively with the provinces as well. There are two of them now on the way. Ontario, I believe, struck a committee to actually look at measurement. We're going to have Mr. Mendelson here before us to talk to us about that, which would be really important.

But there are jurisdictions out there, you're saying, that have in fact arrived at a decision, however politically in terms of—