If you turn to the slide on page 3 of the handout, you will see a blue line that indicates the trends since 1980.
Sorry, I'll go back to English. I switched to French.
If we go back to the low-income trends since the early 1980s--in blue you have the LICO after tax rate--as Mr. Fedyk has mentioned, you see that there were two peaks following the two recessions in the early 1980s and in the 1990s, when low-income rates rose significantly. The message is that basically in the late 2000s, the low-income rate is roughly back to where it was in 1980. There are more people above the low-income rate because there is an increased population, but the rate was roughly the same in 2004 as it was in 1980. There was a slight decrease in 2005. We'll see next year if that trend is continuing.
I've talked about the MBM as being a relatively new measure. At the Canada level, if we look at the transfer of the MBM from 2000 to 2004, the Canada level gives roughly the same picture of a low-income rate slightly declining in the beginning of the 2000s.
If we move on to page 4, this apparent stability in the low-income rates masks some trends that are different among age groups. Again, this has been mentioned by Mr. Fedyk from HRSDC. The most noticeable trend is the significant decrease in the low-income rate, based on income after tax for seniors, from 1980 to 2005. That's the green line. You can see that there's been a significant decrease in the low-income rate.
There has been a slight increase for working-aged people, 18 to 64. It is about the same level for low-income rates for children under 18.
The source of the data we produce for our low-income rates is actually a longitudinal survey. That means you follow people through time. This allows us to see from year to year how many people move in and out of low income. People are followed for six years.
So if we look at our last six years of data, our last panel, which is from 1999 to 2004, basically 80% of Canadians were not below the low-income level in any of these six years. Twelve percent were under the low-income level for one or two years; 4.3% were there three to four years; and 3.7% were there five or six years, which may be more the group that you would call persistent low income.
There has been some research that has shown--and it was mentioned again before--that there are some persistent low-income groups, which are highly concentrated among five at-risk groups: unattached individuals aged 45 to 64, persons with a work-limiting disability, recent immigrants, lone parents, and aboriginal Canadians living off reserve.
With the current source of data, the survey of labour and income dynamics, because of sample size, I'd say there are some groups I'd prefer not to give statistics on. Our census of the population May 1 will release the income data from the census. You'll have a lot more detailed information. So if the committee is interested, there are more updated numbers, and following the May 1 release of the data, we'd be happy to provide you updated information.
I'm going to give you some trends on two groups in particular: lone parents and recent immigrants. The trend you have on the top line is that for lone-parent families. The overall message is that while low-income rates of lone-parent families have decreased from the early 1980s to what we see in 2005, they remain significantly higher than the low-income rates for families with two parents and children.
The next slide shows that for low-income families there's been an improvement, though it's still much higher. But there is a group, which we call the recent immigrants, particularly immigrants who have arrived in the last five years, for whom conditions have not actually improved.
For this we used a slightly different methodology. I have here not the low-income rates of recent immigrants, but more the relative position of low-income rates of recent immigrants compared to Canadian-borns. If you look at the chart on the left, it tells you that in 1980 the low-income rate of immigrants who had arrived in Canada in the last five years was roughly 1.4 times higher than the low-income rates of the Canadian-born population.
That ratio--the relative deterioration of the relative positions of recent immigrants--meant that by 1995, immigrants who arrived in Canada in the five years prior to the 1996 census had a low-income rate that was 2.7 times higher than the low-income rate of the Canadian-born population.
The last year for which we have census data is 2000. There was a slight improvement from 1995 to 2000, but using administrative data--a slightly different methodology—part of the decrease seems to have been due to the qualifications of some of the immigrants who came in, particularly one group where there were more in some of the high-tech and engineering groups. The situation improved a bit for some between 1995 and 2000, but because of the slowdown in high tech in early 2001, it has increased again. So the relative position of low-income rates of recent immigrants in 2002 has increased again to be close to 1995 rates. In the last two years it seems to have improved, but it hasn't quite recuperated yet.
I've talked about the market basket measures and the LICO. If you were looking at trends for children, seniors, and working-age adults, most of the trends are similar if you use the LICO or the MBM. However, if we look at provincial ranking and how provinces fare, the two measures give different levels and trends. If we look at 2004, which is presented on slide 4, you can see that on the blue line you have what is typically produced with low income after tax. On the red you have the market basket measure. You can see that Quebec, for example, which has one of the highest low-income rates under the LICO, has the lowest rate using the market basket measure of low income.
Why is there such a difference between the measure you choose for low-income rates between the LICO and the MBM? They are two very different methodologies. They don't use the same income measure for how much income you need. One uses income after taxes; one uses an MBM disposable income. There are also fundamental differences. The MBM is more a measure of cost of living.
If you look on slide 10, the methodology that was used with the LICO shows that you require the same amount of money for all cities that have 500,000 people or more. It would be the same for eight large cities in Canada, including Montreal, Toronto, Calgary, and Vancouver. Under the MBM, because it's more of a cost of living measure that is based more on geography, you actually reflect that the median rent in Montreal is about $5,000 less than the median rent in Toronto or Vancouver. So if you are looking at geographic background, that is why the MBM gives a very different picture than the LICO at the provincial level.
There are also other differences, such as how we handle transportation. That shows fewer differences between rural and urban with the MBM than with the LICO. Basically, the MBM assumes that in cities you will use public transportation. That's usually not available in rural areas, so because of that, low-income rates in rural...you need to have a car, so expenses are more. That's why the thresholds are higher, and that explains some of the differences.