Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 12 - Evidence - Meeting of November 28, 2006
OTTAWA, Tuesday, November 28, 2006
The Standing Senate Committee on Agriculture and Forestry met this day at 7:05 p.m. to examine and report on rural poverty in Canada
Senator Joyce Fairbairn (Chairman) in the chair.
[English]
The Chairman: Good evening, honourable senators, witnesses and our television viewing audience. Last May, this committee was authorized to examine and report on rural poverty in Canada. For too long, the plight of the rural poor has been ignored by policy-makers and politicians. This fall, the committee has been hearing from a variety of witnesses to provide an overview of poverty in Canada's rural areas. This work will then serve as a basis for the committee's planned travel to rural communities across Canada next year.
Our first witness this evening via video conference is Dr. Chris Sarlo, Associate Professor of Economics and Director of the School of Business and Economics at Nipissing University, North Bay, Ontario. He is also an adjunct scholar with the Fraser Institute. His work on a basic needs measure of poverty has helped to nourish a healthy, lively debate on the definition of ``poverty in Canada.''
Dr. Sarlo, welcome to the committee. We have one hour this evening to discuss this important issue with you. I invite senators to keep their questions as brief as possible so that our witness can respond fully and so that everyone can contribute to the discussion this evening. Dr. Sarlo, please proceed with your presentation.
Chris Sarlo, Senior Fellow, Fraser Institute (by video-conference): I have a short, prepared statement for discussion. I understand there will be sufficient time for questions as well. I thank the committee for the invitation to speak to you and discuss some important issues.
I want to say that there is real poverty in Canada. There exists, in this well-off country, people who are hungry, who are inadequately housed and who, for whatever reason, do not access the services they need. All of this threatens their health and well-being. I have travelled across this country as the song says, from Bonavista to Vancouver Island, and I have seen, first-hand, excruciating poverty in both urban and rural settings. Those of us who live comfortable, middle- class lives need to get out on the roads, in particular in Eastern Canada, to see some of the living conditions of our fellow citizens. There is no question in my mind that many Canadians live impoverished lives.
It is the job of the social scientist to measure such phenomena. We need to bring our rigorous skills and the scientific method to bear on this important problem. My concern is that if we do not have careful and credible measures, we will not have effective and accountable policy. The focus of my remarks today is on the measurement side of this important social and economic problem.
The federal government spends billions of dollars every year on policies and programs directed towards poverty. I include in this expenditure the transfers to the provinces, some of which are used for social assistance, housing and other programs. Let us suppose that someone, a reporter or a citizen, were to ask a member of the government about accountability for the funds spent. What would the government say? Let us be more specific: Suppose someone were to ask the Prime Minister how many poor people we have in Canada at this time. What would his answer be? Suppose that he were asked whether government policies over the last while have been effective in reducing poverty over the years. What would his response be?
In both cases, he would have to say, honestly, that he does not know. Those of us in the research community, if we are honest, would have to say that we do not know either. There are two main reasons for this unfortunate conclusion. First, there is no official poverty line or even a generally accepted measure in Canada. Second, the income indicator that we use to tell us how well-off people are is so badly flawed that we could not estimate poverty accurately even if we had a generally accepted poverty line. I will look at the second of those reasons first.
Income is used in almost all studies that estimate the number of poor people. However, income data that we all use for such estimates comes from Statistics Canada, and is largely drawn from surveys in which households are asked to reveal their income for the previous year.
The data we use is ``reported income,'' which may or may not be the same as actual income. For a variety of reasons, people do not always accurately report their income. One reason may be linked to the deliberate hiding of income as part of tax avoidance.
The 1999 Auditor General report focused some attention on this issue, and estimated that the legal part of the hidden economy was about 4.5 per cent of GDP. The illegal part, which includes such activities as gambling, prostitution, drug dealing and theft, would be significant as well. The report suggested that the problem with hidden income would grow over time due to the growth in self-employment and electronic commerce.
I should mention, as well, that there are newer databases drawn from tax filer data that are used particularly for the study of the dynamics of poverty. It is my understanding that these data are prone to the same kind of under-reporting as the Statistics Canada surveys. The Auditor General, again in its 1999 report, has estimated that the two levels of government lost about $12 billion annually as a result of this tax evasion.
I am convinced that a database does not exist in Canada that tells us accurately about the incomes of Canadians. By way of illustration, let me give you a little peak at the 2004 distribution of reported income, which is drawn from the survey of household spending. If you folks have it, there is a slide 1, entitled ``Distribution of Canadian Household Incomes — 2004.''
At the top end of the distribution, we have more than 1,000 households with a 2004 reported income of $3.7 million. You should understand that the survey is a random sample, so every record in the file represents a certain number of households in Canada.
At the bottom of the distribution, we have almost 2,000 households with negative reported incomes. That is due largely to small business losses. The average reported income in 2004 was $63,400, and that is average household income.
We are interested in poverty, so let us take a closer look at the bottom of the income distribution. That is all households with incomes of $5,000 or less. I turn your attention to slide number 2, entitled ``The bottom of the Income Distribution — 2004.''
I used $5,000 as an arbitrary point, because a household, or even a single person, cannot survive in Canada on less than $5,000. They simply cannot purchase all the necessities. Yet, in 2004, 185,000 households apparently did. What is puzzling is that our last-resort program, social assistance, provides more than $5,000 per household in every province for those households in need. Therefore, there are real questions about the reliability of data that tells us that 185,000 households had incomes this low.
I should also mention that 41,000 of these households had zero reported income. Overall, this group had an average reported income of only $1,951 — less than $2,000 for all those households with reported income of $5,000 or less.
By anyone's standard, this group would be the poorest of the poor in Canada. However, the same Statistics Canada database that this information is drawn from provides additional information about these households. The average reported spending by this low income group of households was over $20,000, more than 10 times the average reported income.
This significant discrepancy between reported income and reported spending at the lower end of the distribution calls into question the basic data that we use to measure poverty. We will never be able to estimate the extent of poverty with any accuracy until we deal with the issue of reported incomes. In all my writings on poverty, I have pointed out this problem, and I have urged Statistics Canada and government policy-makers to address the issue of poor data.
The other reason that we cannot answer the question of how many poor people we have in Canada is that there is no accepted poverty definition to use as a basis for a poverty measure. There are two broad approaches to defining and measuring poverty. The relative approach identifies someone as poor if they have substantially less than most others in the society or the community. A commonly used relative measure is half the average income. This approach is popular within the social welfare community. It views poverty as a problem of inequality.
The other approach is the so-called absolute approach, and it views poverty as a problem of insufficiency. According to this approach, you are poor if you lack or cannot acquire any of the basic necessities of life. Clearly, though, there is even a relative component to this approach. The basic necessities must be those that are accepted within your own society or in your own community.
An example of a relative line that is frequently used in Canada is Statistics Canada's low-income cut-off, the so- called LICO. Many of you are familiar with that. There are concerns with this measure besides the fact that it is a complex construction and it is difficult to explain to Canadians.
One concern expressed by the provinces, which has prompted the development of the market basket measure, is the fact that the lines are too high to represent poverty as most people understand that term. The provinces were clear that they were tired of having their social assistance rates compared to the LICO lines as if LICO represented poverty.
Another concern is that Statistics Canada does not even support the use of LICO as a poverty line. Chief statistician Ivan Fellegi made this clear statement in 1997:
For many years, Statistics Canada has published a set of measures called the low income cut-offs. We regularly and consistently emphasize that these are quite different from measures of poverty. They reflect a well-defined methodology which identifies those who are substantially worse off than the average. Of course, being substantially worse off than the average does not necessarily mean that one is poor.
If we were to use the LICO measure, the so-called ``poverty rate'' for Canada is now exactly where it was in 1981 — 15.9 per cent. Using LICO, there has apparently been no improvement in poverty over this period, between 1981 and 2004. Campaign 2000, which uses the LICO as a measure of poverty, recently reported that the child poverty rate has increased by 17 per cent since 1989. They claim that now about one in six children is poor.
An example of an absolute measure of poverty is the one that I have developed, called the ``basic needs poverty line.'' One often heard criticism of this measure is that it is too low, even mean-spirited. I have always been puzzled by this critique. Why would we not, as part of our need to understand poverty, want to have a measure that could tell us how many of our fellow citizens simply cannot afford the basic necessities of life? These lines are low because they represent the cost of basic needs in the various parts of Canada.
In contrast to the rates that I gave you for LICO, the basic needs poverty rate has declined by about 31 per cent between 1981 and 2004. To refresh your memory, there has been no change in the LICO rate of poverty over that same period. The basic needs poverty rate declined about 31 per cent over that same period, from 7.1 per cent to 4.9 per cent. This estimate, of course, uses reported income and we have already talked about that. In contrast to the Campaign 2000 estimates using LICO, basic needs poverty among families with children has declined by 25 per cent since 1988.
It is my long-standing view that LICO should not be used as a measure of poverty. There is certainly some value in measuring inequality in Canada but LICO is not a good measure of that either.
The Toonies for Tummies campaign sponsored by the Grocery Industry Foundation of Canada has highlighted the problem of using LICO. The Toonies for Tummies campaign has received national exposure over the last two months. That campaign makes the claim, in national ads and on its website, that one in five Canadian children is hungry. There is absolutely no scientific study that demonstrates this claim. In speaking to reporters recently, I learned that the basis of the claim is the Campaign 2000 material which uses LICO as if it were a poverty line. Of course, LICO is a relative line and makes no claim to be able to determine the extent of manifestations of deprivations such as hunger.
My own basic needs poverty measure claims to get at real deprivation and I have concluded, based on the most recent data, which is 2004, that about one in 18 Canadian children live in households with reported incomes below the amount needed to cover all the basic necessities of life. This number is a long way from one in five hungry children, yet the Grocery Foundation campaign has a national audience. Canadians, in the absence of any questioning by their political representatives, may believe that 20 per cent of our Canadian children are hungry.
I have been consistent in my recommendation that Canada adopt a small number of measures, perhaps two or three, that would give us a clear picture of the prevalence of poverty in this country. One single measure may not tell us everything we need to know. In fact, this was precisely the recommendation of the Copenhagen Agreement in 1995 to which Canada was a signatory.
However, whatever we adopt in terms of measures we simply cannot make any progress in determining the extent of poverty until we settle the data question. I cannot stress this particular step strongly enough.
Let me conclude by saying that it is my hope that we, in the research community, can reach some kind of consensus about a measure or measures that accurately reveal the extent of poverty in Canada. The danger, of course, is that endless debate about the appropriate definition of poverty may deflect attention away from the poor and their predicament. At the same time, we all need to acknowledge that governments must be accountable for the substantial amount of money that is spent on poverty. To craft intelligent and effective policies we need a clear idea of the nature and dimension of this important problem.
Senator Mercer: Thank you for appearing this evening. We appreciate your time and your comments.
You have troubled me, though. You have said the Statistics Canada data is not doing the job. The data is not giving us the statistics we need. You talked about the Toonies for Tummies campaign using the number of one in five children in Canada being hungry. Then your measurement, which I am not sure I understand, says one in 18 children. That is a huge difference. It seems to me that there must be a better, scientific way of measuring this.
You are right in saying that Statistics Canada receives their data from people who respond to questionnaires, but is there not other revenue available that government has access to that could allow a more detailed analysis of income, that does not rely on people self-identifying as poor?
It seems to me you said a lot of people who say they are poor are not poor. I suggest they might have a little problem with that.
Mr. Sarlo: There are two ways in which we extract information from Canadians to form the databases that we use, to see how well off Canadians are. One is through surveys; we ask people to report their incomes for the previous year. The other is through tax filer data. We know from various reconciliation work with Statistics Canada and we know from the Auditor General that the data is not reliable. The Auditor General has pointed out that Canada loses billions of dollars every year because of tax evasion, so a certain number of people, and I am not saying all, are not reporting their incomes accurately. Certainly, that happens on the surveys.
I would welcome some kind of government study into how to obtain good and accurate information. I am frustrated, as you people are. I am a poverty researcher. I am trying to obtain good data so I can report as accurately as possible. I am not confident in the estimates that I make. I think they are broadly in a ballpark, in terms of basic needs. I can use those and publish those estimates, but I always have the caveat that I am not confident of the numbers precisely because of the problem of unreported income.
Senator Mercer: Tax evasion is not poverty. It is illegal and a bit of a sport for some people, but it does not help us measure the rate of poverty, specifically in rural Canada. You are telling us that the data we would normally go to, that of Statistics Canada, is unreliable, but nobody, including yourself, has given us a hint as to where reliable data is.
I suspect that reliable data may rest with the municipalities who deal with the poor on a day-to-day basis, people who cannot feed their children and the children go to school hungry, and who cannot pay the bills because there is no money coming in for various reasons, or the money that is coming in is not managed properly, because that is another type of poverty.
Is there an answer?
Mr. Sarlo: I appreciate what you are saying. In the absence of any reliable measures, people at the local level, the helping professions and the voluntary groups, have to feed the poor and assist them. I am just saying accountable government needs accurate measures. They need to be able to say to the Canadian population, we know what poverty is, we have defined it, and we have reliable information that tells us how many poor there are, and whether they are rural or urban. Then we can use that data as a baseline. If we have a policy, we can go back and say that policy is effective or not effective.
I am saying, in terms of accountability, I think it is important for politicians to have accurate measures and in the meantime, we obviously need to help the poor, but I think accurate measures are absolutely essential.
Senator Mercer: We have created a system where we have strict privacy laws — although some people would say liberal access to information laws — that limit our ability to study these numbers, in reality. Have we snookered ourselves? We recognize there is a problem because the data support that, but have we created an environment whereby we cannot access that data because of rules we have put in place?
Mr. Sarlo: I would be interested if members of the committee would talk to officials from Statistics Canada. Other countries have the same kinds of issues and might have solutions that would be worth considering. I would be interested to hear what they say because I have been working with this problem for a long time. It is frustrating and I wish there were a solution. Privacy issues are understandable but if we are to spend billions of dollars, then we need clear definitions and information.
Senator Mercer: You made reference to other countries. My last question is: Who does it better? Should we look at a particular country in respect of how it measures poverty?
Mr. Sarlo: I do not study poverty issues all around the world but I look at the American data. A serious attempt was made in 1995 to account for many things missing in the data, such as subsidized housing. That made a difference in people's lives because they had access to affordable housing. Whatever income they had was perhaps understated because they had subsidized housing. In Canada, perhaps we would include health care, and so on. There are ways of taking a more comprehensive look at this issue. It will not be easy but some of the American studies might help.
The Chairman: Mr. Sarlo, we have heard from Statistics Canada officials on this topic. We would be happy to send you a copy of their contribution to the committee.
Mr. Sarlo: I would like that.
Senator Callbeck: Mr. Sarlo, you talked about the importance of a credible measure for poverty and you mentioned that you developed a measure of poverty called the basic needs poverty measure. Where do you get your figures for this measure? Do you prepare measures for every province? Are they different for rural and urban areas?
Mr. Sarlo: Yes: I have a list of basic needs, which I have published since 1992. I have adjusted the needs in my most recent list from 2001 to take into account comments and criticisms from various quarters about what should and should not be included. I have that list of items that, arguably, would be on most people's list of basic needs. I cost out those items for various cities in Canada. For example, I have information from CMHC that tells me about average apartment rental costs in the various cities. I have information from Statistics Canada on food costs and from social agencies on the costs of clothing, et cetera. It is a tedious exercise but student assistants help me compile the data to determine costs in urban areas. I have not excluded the rural poor, where I understand there are real problems, but it is difficult to gather data on small communities. For example, CMHC has information only for communities of 10,000 or more, so I am limited by data constraints. I imagine some of the larger agencies, such as Statistics Canada, would have greater access to information that could extend such research to rural areas.
Following that costing out, I prepare a kind of weighted average for each province and for Canada as a whole. The weighted average begins at the community level because there are big differences in costs of living between places such as Vancouver and Toronto versus smaller communities in the Maritimes.
Senator Callbeck: Have you been doing this since 1992?
Mr. Sarlo: I started before that. My first publication was in 1992 but I have been working at this since the late 1980s.
Senator Callbeck: Are the declines that you spoke to in your presentation based on your measure?
Mr. Sarlo: That is right.
Senator Tkachuk: I have a question or two on regional breakdowns. In response to Senator Callbeck, you said that your numbers are taken from the urban population and not from the rural population. Where are the poor in this country, according to your measurement? I do not think that the LICO measurement used by Statistics Canada is a good one.
Mr. Sarlo: I prepared a provincial breakdown in the 2001 publication although it is not in the most recent publication, which came out this fall. Those results are available on the Fraser Institute website. At that time, B.C. had a high poverty rate compared to Quebec, for example. When I looked at that differential, it was curious because the distribution of income in both provinces was similar and the average income was similar.
As an economist, I think the difference that we can point to is that the cost of living in B.C. is much higher, in particular accommodation costs. The poverty lines reflect the costs that people have to pay to live, and they were much higher in B.C. than they were in Quebec, despite the fact that the two provinces had a similar income distribution. A high poverty line in B.C. means that more people live below the line because the line is higher. There is some explanation for that. I could look at a broad spectrum and backdate the poverty lines to the data from the 1950s and 1960s, and I have had information on the provinces since 1973. Typically, the Maritimes have had more poverty than other parts of Canada — Newfoundland in particular. My focus has always been on Canadian poverty rates. I appreciate that this committee wants to look at poverty from a regional perspective, so I am not of much help. Certainly, I know that traditionally the Maritimes have been a poor area.
Senator Tkachuk: Who are the poor? Do you have a profile of the people that you identify as poor?
Mr. Sarlo: Yes: Again, the most recent publication does not include such a breakdown because it was a short item. Those experiencing high rates of poverty are young people under two years and single parents. One notable thing and the phenomenon that you will hear from most of your witnesses is that poverty among the elderly has declined substantially. That is true whether you use the LICO or basic-needs approach. We have had a decline in poverty among those 65 years of age and over. There are regional differences but I would not draw attention to those. The two groups that I identified, the young and single parents, are particularly vulnerable.
Senator Tkachuk: Is part of the problem because of the education level of the young? It seems to me that their incomes would be lower because they are starting into the workforce after Grade 12, and might have a job at minimum wage. Perhaps some people have difficulty finding work at the outset, although in today's world I find that difficult to believe. In the past, that was the problem. Is it more at the start-up level or is it a chronic group of young that are always poor because of certain parental, psychological or educational reasons?
Mr. Sarlo: My finding is that it is the former, that people are simply starting up. It is difficult sometimes to find that first job. Some people start part-time work first and their annual income is low as a result. Some people perhaps are not settled in their idea of what they want to be so they move from job to job. Again, that movement adds to a lower income.
As well, it is important to recognize that college and university students are included in that group. Statistics Canada includes as income only any earnings that these folks have or any scholarships, and the combined earnings and scholarships may be low. Statistics Canada does not include student aid, which is the largest component for most students. I understand why they do not; a student loan is not income. Nevertheless, we understate the real situation of more than 1 million college and university students who attend university or college when we use only reported income.
Senator Tkachuk: Of course, it would not include the income from parents who send cheques, perhaps, to help with the rent, food or whatever, because that money is already tax-paid dollars.
Mr. Sarlo: You are right. Gifts from parents or from anybody are not included as income.
Senator Tkachuk: I wanted to ask about the second group. These two groups have come up before. When I have been in committee, we have never had a good discussion on who these people are — both the young and the single parents, which is a social problem not only in Canada, but also south of the border.
Are they single parents that have been married or single parents, period, because they had children out of wedlock when they were in high school?
Mr. Sarlo: To be honest, that question takes me beyond my expertise. There are demographers who can inform you much better about the breakdown of single parents. I know there is a mix of the two — people who were never married and those who have been separated or divorced — but my studies do not go into that.
Senator Tkachuk: It seems to me governments should address the cause of poverty, as well as poverty itself. To bring down the poverty rate among single parents, we need to have fewer single parents — fewer teenage pregnancies would help to cut down the poverty rate. That is one social issue.
The other social issue is, in divorce, fathers need to be responsible for their children. Are governments doing that kind of thing, or am I a lone voice in saying we should address these issues rather than the ones we are addressing?
Mr. Sarlo: I do not disagree that government policy-makers should look at the causes of poverty. I do not know that there is a large scientific literature on that. I have been interested in that myself.
On the issue of separation and divorce, we read about more aggressive approaches to going after non-custodial parents for care of children. Beyond that, my research has looked more at measurement issues and trying to find accuracy in the nature and dimension the problem. For the policy issue, I think you are absolutely right. You want to look at the causes because government is responsible for the money they spend and Canadians want to ensure that the causes are attacked, not only the symptoms.
Senator Mahovlich: When I was a young boy living in Timmins, I did not think anyone was poor there. Perhaps it was because we were all poor, and the reason no one felt poor was because we helped each other. We were all labourers; the government had nothing to do with it.
Should society rely on government now to solve this problem, or should we solve this problem for ourselves? Is it a job for governments?
Mr. Sarlo: I will try to answer that. It is notable, when one looks at the research I have done, that from 1951 to about the mid-1970s, we had the greatest decline in poverty in this country. That was a time when we did not have much in the way of government social programs.
However, since that time, poverty has come down much less so — at least the poverty that I measure. We moved from about 40 per cent poverty down to about 10 per cent poverty through the strong economic years of the 1950s, 1960s and early 1970s.
I think we are looking at a different type of poor person now than we might have then. People for whom a good job and a higher paying job would move them out of poverty are still there, but largely we are looking at people at this point in time who are having more struggles than those people in the 1950s and 1960s had.
Maybe they are struggling with coping with life, single parenthood, drug addictions and so on. There are many more issues in dealing with this group. It may be more difficult to reduce poverty from 10 per cent to 5 per cent, or from 5 per cent to 2 per cent than it was to reduce it from 40 per cent to 10 per cent in the days when people needed only a good job and higher real wages to improve their living standard.
We need to appreciate that the character of poverty may be different now than it was back then. However, I think many Canadians would agree that in the 1950s and 1960s, we had a tremendous amount of helping of each other, much less government intervention and people did move out of poverty.
Senator Mahovlich: I guess times have changed. You mentioned that British Columbia has high living costs and high poverty. In Ontario, in the city of Toronto, it is expensive, I find; it is high cost. Do we have more poverty in Toronto than anywhere else in Canada?
Mr. Sarlo: I have not looked at poverty in individual cities per se. The reason for that is that we have low counts in the surveys that we do — low enough counts that it is difficult to do that accurately.
However, you are right; the city of Toronto would have high costs. To the extent that people's incomes are low, many more people would be below that line, and other studies indicate that. As for the rest of Ontario, there are differentials, but where I live in North Bay and where Senator Mahovlich lives in Timmins — together with other places — things are much less expensive. Many communities also are lower cost and we need to factor that in, but you are right that a big city such as Toronto weighs heavily in the Ontario statistics.
Senator Segal: Dr. Sarlo, welcome and thank you not only for your time tonight but for all the outstanding work you have done on this issue of measuring poverty. It has enriched the debate in the country and helped us break out of sometimes unconstructive orthodoxy which, as you indicate, is not statistically as sound as some would have us believe.
I want to ask a specific question about your basic needs standard, and then ask for some advice on the challenge of rural poverty specifically.
If one assumes there are problems with the LICO measure because it is a relative measure as opposed to an absolute measure, and one compares it to the benefits of the basic needs measure, it strikes me that we have a couple of anomalies. Having the money to buy food and shelter, for example, and using that as the cut-off, does not necessarily address the stigma of poverty.
To be fair, an economic measure cannot address those other things. I think here and in society generally, we all worry about that, a child who senses that everyone else in the class can afford to go on a field trip but them, so they have that sense of being outside the mainstream.
We could find ourselves in a circumstance where a kid in a farm family, for example, ends up being hungry in a particular week or time frame because $40 that might have been used for food normally has to be used that week for higher energy costs, or maybe to buy a new sets of boots. That happens from time to time as kids grow.
Even if families have exactly enough to clothe, feed and shelter themselves and meet obligations, it does not mean necessarily they are not poor. What if, for example, they live in an area that — by your measure, I think — calls for the use of public transit, but they live in a rural area where there is not public transit and they cannot afford a vehicle for various reasons?
I was fascinated and attracted by the anomaly that you pointed out relative to reported income versus spending. There are two ways to look at that. I do not suggest this is what you suggest at all, but one could look at that and conclude that the poor tend to cheat the system sometimes. Of course, the other approach might be that if you are poor, cheating the system might be the only option you have of getting by in some fashion. I do not advocate either one of those, but I make the case that cheating the system may emerge as part of our problem.
The question is the extent to which the kind of core humanity that Senator Mahovlich talked about, people helping each other and being part of the mix, is community-based.
The second question then, and the one I think perhaps where you can give us immense advice and counsel is the different nature of rural Canada. We know, in terms of farm income, we are at all-time lows. We know that the incidence of food banks is up massively across the country in rural areas. We know that the amount of farms moving from generation to generation in Ontario is now down to 7 per cent because making that transition is not viable. I accept the economic frame that people should move to where the jobs are and the destructive force of a dynamic economy: one thing collapses, something else is the new force and people move to that. I understand how that works and I do not think it is a bad thing all the time. However, in the interim, human lives are affected. I think part of what we are trying to do around this table is to find the most constructive way for government to help. It may well be for government not to do some things, and, in fact, to step back from doing some things so the community can do some things more effectively.
I am interested both in your reflection on some of the challenges in your own standard and what advice you would give us, in terms of the rural poverty issue such as it is, however ineffectively measured it may be in various ways.
Mr. Sarlo: In my writings, I suggest that the construction of basic needs poverty lines is a kind of average. It looks at people in general; it looks at people particularly who are healthy. Particular situations differ from the norm: a disabled person, or a person with particularly high medical costs or other costs. We need what we call personal poverty lines. Everyone has their own personal poverty line. I cannot do anything, though, with 30 million personal poverty lines. When looking at rural Canada, for example, if we wanted to obtain good data, we need to look at where things net out for most people, taking into account particular situations.
For example, as you mentioned, transportation costs may be much higher in rural areas but the accommodation cost may be lower, depending on the situation. Where do those factors net out and where can we find a line that is useful in telling us what is going on?
That can be done. Again, I do not have the resources to do that, but there are agencies that do.
On the stigma issue, you raise a good point. I think we would like to address that as well. I focused attention on basic needs not because — and I think there is a real difficulty in understanding this — I think the poor should be there. I have received criticism that Sarlo wants the poor to have only this much. I hope that we find a day when no one is below the basic needs line, but in the interim we need to measure those needs as part of our understanding of poverty. We need to find out how many of our fellow citizens cannot afford basic needs. If we can get around the problem of income data, this will help us a lot in understanding where we are at, and to provide policy-makers with good data to begin work.
I am not qualified to talk much more than that about rural issues, and I appreciate the challenge you have. It is of value to look at that. I have not been able to simply because of data constraints, but I understand it is there. In travelling with my children across this country I have seen houses that we would not want animals to live in. There are sad situations and I wish the committee well in addressing that issue and finding solutions. Again, it is beyond my expertise to suggest anything.
Senator Segal: How might your basic needs measure apply, to the best of your understanding, relative to the challenge we face in rural Canada with our Aboriginal First Nations? Would you break them out in some way or would you measure them in the same fashion because the numbers are the numbers, in essence, and if they are sufficient for one family they should be sufficient for any family? I do not have a bias, but I would be interested in your perspective.
Mr. Sarlo: I would not do too much adjustment. I think that if there is a compelling case that one particular group has significantly higher costs for a good economic reason, then that is fine and you can make that adjustment. However, generally I would say, go out and measure the cost of basic necessities in each community you look at and find out how many people have incomes that cannot cover that cost. That would be my suggestion.
Senator Peterson: Thank you, Dr. Sarlo. Therein lies the problem. You are not enthused about the information from Statistics Canada and you seem to have defined what poverty is, but we do not know how many poor there are or where they are.
Is there some way to find this information? I know there are privacy concerns, but if we had some type of template, would it be possible to go to a provincial social services department and have them fill in numbers for us? How do we go about finding out how many people? Before we solve the problem, we need to know how many, I think.
Mr. Sarlo: Absolutely: I do not want to minimize the problem. I have struggled myself with how to find good data. Again, some of the U.S. studies might be helpful. I think you have experts in Statistics Canada. I do not know. You said Statistics Canada has already addressed the committee. Have they laid out the problems they have with income? If they have not, maybe they need to come back and face that challenge. Is that data reliable? Can we say that someone who has a zero-reported income actually has a zero income? If that is reliable, you can ask: How are they living? How are they existing if they have a zero income? Those folks need to take on perhaps some the challenges of getting good data before the senators and parliamentarians can craft policy. It is a difficult issue. You may need to use focus groups or another method to get at the real truth. There may be indirect ways of getting at that information, but I can say that I have found real problems and real frustrations in doing the work I do. As I say, I think I have a ballpark idea of how many poor we have in Canada using my basic needs measure. I have a general idea, but I know I am missing something. I know there are gaps. I still publish it because I think it is of value and should be out there as part of the debate, but I wish Statistics Canada would address that issue.
Senator Gustafson: As we are all aware, this challenge is difficult. As you said in your presentation: How do you measure poverty? This committee is an agricultural committee and part of our work is to measure poverty in agricultural areas. Over the last three years, in certain areas of agriculture there has been no income at all — there has been negative income. Some people are living off of what they have accumulated to that time. There are serious problems. I do not want you to come at me too strongly but what is your take on the idea of a guaranteed income?
Mr. Sarlo: Are you asking about a guaranteed annual income?
Senator Gustafson: Yes, what is your view on a guaranteed income sponsored by the government?
Mr. Sarlo: Curiously, I have written on that topic. In a serious way, I have tried to evaluate that and determine what a basic cushion would look like that would encourage and promote a work ethic for every Canadian to ensure that no one falls below a certain level. There is merit in looking at the idea and it would generate a great deal of debate. We have it in a sense, some might say, with our social assistance programs in every province because they are akin to a guaranteed annual income that people do not fall below. Maybe some reworked social assistance that positively promotes work but covers people in cases where they cannot work is needed. I have written about how that might play out and what advantages and disadvantages there might be. It is worth looking at.
Senator Gustafson: Have you done any work on family allowance in the different provinces?
Mr. Sarlo: I understand there is a National Child Benefit that is, I believe, the same for every family in the same situation. I understand that benefit has been enhanced over the last several years.
I look at total income, so that includes all resources available to the household, with the exclusions I mentioned earlier. Thus, family allowance is included as part of family income.
Senator Gustafson: My background is much like that of our hockey player, Senator Mahovlich. We were told by our parents that if you work hard, it will all come about, which it did, and that with good hard work, somehow you can get through. However, times have changed. It is difficult to find farmers today that butcher their own beef or that raise chickens. These things are all directly related to what we expect out of life, in some ways. Yet, as Senator Mahovlich said, things might have been more stable then than they are now.
What can we do about something like that? I suppose there is not much we can do.
Mr. Sarlo: I would mention something that my colleagues in the social welfare community would probably emphasize: People have difficulty coping for a variety of reasons — mental health issues, addiction issues and family violence issues, et cetera. Some people might have real difficulty at this time and we hope to help them get over such problems but, in the meantime, they might fall below the poverty line. We need to decompose all those things so the policy-makers can have the information needed to develop better policy.
Senator Gustafson: I have one more question on food banks, charitable donations and government support to families. Are Canadians charitable?
Mr. Sarlo: My understanding is that we are reasonably charitable. I know that level varies across the country. I understand Newfoundland is at the highest level in terms of charity. It is important that people give to others in their communities. Some help provided by charities might be more effective in some ways than government assistance. People sense a more direct ownership of the people in their community when they do the giving and that might be a more effective way for them to help out rather than simply through a government cheque.
Senator Gustafson: It is possible that the greater part of our charitable giving takes place at the international level than at the national or local level.
Mr. Sarlo: That point is an interesting one. Perhaps there is a perception that poverty is worse in other countries.
Senator Tkachuk: I will follow up on questions of other senators as well as my earlier questions. I have always believed that to give cash only does not help to solve the problem. Some people are poor through no fault of their own, whether a disability or other factor might be the cause. You mentioned that it is easier to solve the problem for larger numbers because it is a matter of addressing employment or economic issues. Once those issues are addressed, the numbers begin to fall. Then, it becomes more difficult to deal with the bottom end of the strata because the problems are more difficult.
As well, you said that the greater numbers of poor are single parents and people under 25 years of age. We have discussed that in rural areas and have found that programs need to accompany the cheques. For example, addicts need an addictions centre and counselling, et cetera — all the things that society expects a person to have to solve the problem so the person is no longer on welfare. As well, there are social issues that cause poverty. It does not do someone on welfare any good to have additional children out of wedlock and continue to receive welfare cheques, which is another issue. When someone receives assistance, there needs to be another vehicle to address the problem, perhaps through education.
Mr. Sarlo: I have one or two quick comments. I have always believed that the more difficult poverty issues that we might face today, as opposed to those faced during the 1950s and 1960s, probably require more one-on-one help whereby the experts are brought in to assist people on that basis. Whether that is tied to the cheque as a mandatory part of welfare or other government assistance, I do not feel qualified to say. I have not studied that aspect in any detail but there are people who could comment more intelligently on the matter.
It seems that some people are not ready at this point in their lives to take a job that would get them out of poverty. They are not prepared for whatever reason, and I would leave that to professional assessors to make that determination and to professional counsellors to assist them in getting to the point where they can take a job. I agree that the assistance required could be part of a problem.
The Chairman: Thank you for taking the time to appear before the committee this evening. It has been an interesting discussion. Please contact the committee, Mr. Sarlo, should you have additional information for our study. We would be glad to hear from you.
Senator Tkachuk: We should hear from Statistics Canada on some of these issues. This is interesting stuff; he is right — these people are reporting income.
The Chairman: Our next witnesses are from Citizens for Public Justice and they will be with us for the next hour or so. Citizens for Public Justice is a faith-based policy and advocacy group that has worked to make poverty eradication a policy priority.
Harry Kits is the executive director of Citizens for Public Justice. Mr. Kits sits on the boards of a variety of non- profit and charity organizations, and is actively involved in policy work. Most recently, Mr. Kits has been involved in trying to ensure that refugees have access to Canadian student loan programs. He is also interested in the non-profit sector's role in our society.
With him tonight is Greg deGroot-Maggetti, a socio-economic policy analyst at Citizens for Public Justice. He represents Citizens for Public Justice on Campaign 2000, the campaign against child poverty, two national poverty coalitions and the Interfaith Social Assistance Reform Coalition. He is also a member of the National Council of Welfare, a citizen advisory board to the Minister of Human Resources and Social Development.
We welcome you both and thank you for your patience this evening. We have an hour ahead to discuss this important issue with these witnesses. I invite my colleagues, as always, to keep their questions as brief as possible to allow our witnesses to respond fully, and to allow everyone to contribute to the discussions this evening.
Harry J. Kits, Executive Director, Citizens for Public Justice: We are glad to be here to meet with you about this important topic of poverty and, in particular, your interest in rural poverty.
We believe, at Citizens for Public Justice, that the time has come for Canada to develop a national poverty reduction strategy so that we come together to think about what it means to address the issue of poverty and to develop a strategy. Our call echoes calls from the National Council of Welfare, from the Make Poverty History coalition and other groups who are talking about this more and more.
We also believe a strategy would complement official plans that exist, for example, in Quebec and Newfoundland and Labrador. Other jurisdictions, such as the U.K. and Ireland, have already had success in reducing poverty rates as a result of having a strategy to address poverty.
We argue that Canada needs a national poverty reduction strategy because it is something that helps to ensure that everyone has adequate income and services to meet their basic needs. However, we also need a strategy that reduces inequality, develops human capabilities, strengthens communities and that is ecologically sound. We try to bring these concerns together in thinking about those issues.
We also believe that all sectors of society must come together to make this possible. Governments need to take a lead responsibility as part of their public justice task. Government has the ability to shape choices through its regulatory, taxing, social, economic and environmental programs; but businesses, unions, the media, non- governmental organizations, faith communities and families all have their own role to play as well.
For Citizens for Public Justice, the goal of reducing poverty and inequality stems in part for us, as a Christian organization, from the biblical call to do justice. As a national organization engaged in active citizenship, Citizens for Public Justice takes seriously the biblical command to create a society where there is no poverty, from Deuteronomy. God's will is that there should be no poverty in our society and we are called to help make that vision a reality.
Citizens for Public Justice's understanding of public justice makes us aware that the call to do justice cannot be reduced to a call for everyone to take only personal responsibility for their actions. It is not simply a call for us as individuals to be charitable toward our neighbours, although that is part of what justice requires, as personal responsibility is part of it. It is not that we meet the needs of the poor simply through voluntary and charitable organizations, although that too is part of the call to address this issue.
We also need to look at the nature and role of the economy in terms of providing good jobs: jobs that are stable and that provide an adequate living wage. In addition to all that, public justice means that the role of government is to create policies, programs and structures that can help to reduce poverty, and to distribute resources equitably in a society so that all people and all parts of society can flourish and fulfill their callings, contributing to the common good.
An apt biblical example can be found in the sabbatical and jubilee laws of Leviticus and Deuteronomy. The jubilee laws have been publicly recalled in efforts to eliminate the international debt of our countries. Those laws also called for periodic redistribution of the means of production, land, grain and livestock. They called for public policies to allow periods of rest for all people, animals and the land.
We believe these Sabbath and jubilee principles are still relevant and we can make them practical in the policies that government puts together. They indicate that we need to create policies that ensure people have the means to exercise a sustainable livelihood that provides a liveable income. They require that we make sure that everyone has access to an adequate income and the services to live a good life when we are not able to secure all we need through paid work. They also indicate we must exercise care in the use of our natural resources and we must respect the world of which we are part.
A poverty reduction strategy needs to address the causes of poverty, and it needs to include those who are experiencing poverty in determining the best ways to do that.
Poverty in rural Canada will have different dimensions than in urban places, so it is good that the Senate is taking the time to focus on ways to eliminate poverty in rural Canada, particularly if this study is part of an integrated national strategy that addresses poverty overall in Canada.
We were invited, in particular, to address this committee around measures of poverty. As an organization, we, unfortunately, like your previous witness, do not claim special expertise about rural poverty. However, we have spent some time examining the poverty measures that exist in Canada and we are glad to share our perspectives on that. My colleague Greg deGroot-Maggetti will continue with that part of our presentation.
Greg deGroot-Maggetti, Socio-economic Policy Analyst, Citizens for Public Justice: There are essentially three things that a poverty measure can tell us. First is the number of people living in poverty. Second is how deep in poverty people are living. Third is how long people are spending in poverty.
A fourth useful piece of information is how many people are living near the poverty line as well. That can give us a sense of who is vulnerable to falling into poverty.
There are two basic ways to construct a measure of income poverty and I will put it in slightly different terms than your previous presenter. Those two ways are the consumption basket approach and the relative income approach. They sound similar, but the consumption basket approach starts with the question, what goods or services do people need to have a decent life and to be able to participate in society? Then, the cost of these goods and services are added up to arrive at an income threshold that serves as a poverty line.
The relative income approach starts with the question, how far below the income of ordinary households would a person or family be that is struggling to make ends meet and excluded from full participation in the life of the community?
Most of these relative income measures used in the world are based on some fraction of median income, not average income. Median income is the point where half the population has more income and half has less income. The European Union has decided that 60 per cent of median income will be its poverty line. All European Union countries are supposed to have put into place anti-poverty strategies and strategies to end social exclusion, and 60 per cent of median income is the benchmark measure they use to track their success and reduce their poverty.
UNICEF, in its reports on child poverty in rich nations, uses 50 per cent of median income as its poverty line. This level is the same as the low-income measures produced by Statistics Canada. Low income cut-offs produced by Statistics Canada provide the longest line of historical data available to us on low income. That is one reason the data is so often referred to. LICOs are an interesting mix of consumption basket and relative income measure. The consumption basket the LICO uses has only three goods in it: food, clothing and housing. The low income cut-offs are based on what the average Canadian household spends on those three goods rather than on the actual cost to provide a certain amount of food, clothing and shelter in specific communities.
Which of these two measures are most useful for addressing rural poverty? My sense is that a consumption basket measure, such as the market basket measure produced by Human Resources and Social Development Canada, HRSDC, is probably a more useful tool than a measure of relative income. With a consumption basket measure, you can see the impact that transportation costs or housing costs, for example, have on poverty levels in different communities. That information is important if you have a strategy to reduce poverty in different communities.
In rural areas, transportation costs are a much higher budget item than in urban areas and that is borne out in the market basket measures produced by HRSDC. These costs, of course, are magnified when gas prices rise rapidly. In urban areas, housing costs often have a greater influence on the cost of living.
Thus far we have talked about income measures of poverty, but recently more attention has been focused on assets. This measure goes beyond traditional assets, such as financial assets and physical assets, to look also at human assets, such as education, skills and capabilities; social assets, such as relationships, networks and participation in groups; spiritual assets, such as faith life and faith communities; and public or civic assets, such as access to services, and public spaces.
To have an effective strategy to reduce poverty in rural areas as well as urban areas, we need to take into account all these factors that are important in ensuring that people can have sustainable livelihoods and adequate incomes.
Senator Tkachuk: We talk about poverty levels and we talk about income. What income would be poor in a small city such as Saskatoon or Halifax? Do you have numbers or estimates of income?
Mr. deGroot-Maggetti: It depends on which measure of income you use and it depends on the size of the household, but I would refer you to a consumption basket.
Senator Tkachuk: As an example, let us use a young couple or a single person, starting work.
Mr. deGroot-Maggetti: I do not have those numbers off the top of my head but you can find them in the report on the market basket measure. That measure is based on a household of four people, two working-age adults and two children. There is a formula for the figure for a single person.
Senator Tkachuk: What would that be with the two children?
Mr. deGroot-Maggetti: As I said, I do not have that number right off the top of my head.
Senator Tkachuk: Can you help me?
Mr. Kits: I do not have it off the top of my head. Those particular measurements are important pieces of information but we do not want to take only a straight mathematical and scientific analysis of it. Poverty measures are important, but there are a whole range of pieces around poverty which you discussed earlier, as well, in terms of exclusion questions, inequality questions and so on. Those pieces include how the measures function together in ensuring that people fit into society; being able to keep the resources that they have, the assets they have, not have to lose them as part of the welfare system, for example; and be able to carry on with their lives as they move forward.
Senator Tkachuk: Give me an estimate of what it might be in medium-sized city or, I do not care what city, let us just take a number and then work from there.
Mr. deGroot-Maggetti: To give you an example, for the low income cut-off, which is calculated for various cities, for a city over 500,000, the income before tax that an individual would need would be something along the lines of $20,000 a year to reach the low income cut-off for a large city. It is a little less for medium-sized city, and it goes down for smaller areas.
Senator Tkachuk: That is $20,000?
Mr. deGroot-Maggetti: Approximately.
Senator Tkachuk: You mentioned good jobs. Sometimes I am upset at comedians that I love to watch, such as Jay Leno, when they make fun of the Mcjobs or Wal-Mart. To me all work is good and indolence is bad. To work, whether it is for free or as a volunteer, is a wonderful thing. We should promote that. To me, all work is good. We should all be proud of all people who are working, whether they work at McDonald's, Wal-Mart, for a minimum wage or for free as a volunteer because they do not have anything else to do.
Let us say that someone works for $8 an hour with a 40-hour workweek at McDonald's or Tim Hortons or Wal- Mart. That is $320 a week times 50 weeks, which is $16,000. That is for only eight hours a day. There is nothing wrong with people working 10 or 12 hours a day, especially when they are young. That is not a difficult task.
If they did not want to be poor, they would make $20,000. If two of them lived together and shared an apartment, each making $20,000 at McDonald's, together the income would be $40,000. They would split an apartment and they would buy food together, just like we did at university when four of us lived in one house. We all pooled our resources and we lived really well. We had food, but we lived below the poverty line as far as income was concerned. That is not a difficult thing to do in this country.
Mr. deGroot-Maggetti: Let me give an example that relates to the question of child and family poverty. The mother, who is married and has three children, is someone I know, a friend of mine. They are hard-working recent immigrants to Canada.
Senator Tkachuk: I am sure they are.
Mr. deGroot-Maggetti: She works full-time cleaning at a community college on the night shift, and she is paid $9.50 an hour. They live in a basement apartment. It is not a healthy situation. She cannot earn enough working full-time to move herself above that poverty line.
If her husband finds a job that pays him $9.50 per hour, the two together will not earn enough to raise their family. One dilemma, where social policy comes into effect, relates to the community colleges and universities because they have had to pinch pennies to make ends meet. What used to be union jobs for employees of colleges are now contracted out to a service organization. Therefore, she is guaranteed to receive $9.50 per hour, and after six months working on the job, she will get $9.50 an hour. She can work hard, but she will not earn enough to rise above the poverty line.
This kind of dilemma was reported in Campaign 2000 and the National Council of Welfare by about one third of families with children. They have at least one adult in the family working on a full-time/full-year basis but still do not earn enough to raise them above the low income cut-off, LICO. There is still the dilemma in our country that people can work hard but not earn enough to rise above poverty.
Senator Tkachuk: I am trying to be specific because we want to address this problem. Immigrants coming to Canada come from a situation that offers them no hope, and so they come here where there is hope. They might start a low- income job, attend university, try to learn a trade or perhaps do all those things. I have a lot of confidence in immigrants. Immigrants, it seems to me, are not the problem on the welfare roles. They are the ones who work extremely hard and try to find a way to get ahead. Many end up owning a restaurant, a convenience store or perhaps a cleaning company. A woman might start out cleaning someone else's home and then expand to start her own little business. Soon, she will do better than the average Canadian.
I am saying that there are avenues of opportunity to rise out of poverty. Poverty, the way it is described here, is an $8-per-hour job for one person. However, if they work a few extra hours, together they could raise themselves above the poverty line. There is nothing wrong with that, especially for a person who is 20 to 23 years old.
When you cannot tell me numbers, that is a real problem.
Mr. deGroot-Maggetti: The numbers are readily available. Another thing that poverty measures can tell us is where the poverty is concentrated. For example, in the city of Toronto, the United Way has been able to do interesting research in mapping where poverty is located. The poverty rate among new immigrants in cities such as Toronto is disproportionately high. For families with children, the poverty rates have gone up dramatically among new immigrant families. The families tend to be concentrated in different areas of the city. Another creative use for poverty measures in terms of addressing poverty and change in the city of Vancouver is the Human Early Learning Partnership project. This project has provided research to map both where the concentrations of poverty occur, in particular child poverty, and what kind of civic resources are available, such as parks, schools and community centres. Some of that research has shown that the areas where the families living in poverty with the fewest personal resources are located tend also to be the areas where there are no parks and no community services, et cetera.
I do not have all the data with me but the data we can obtain from poverty measures from experts at Statistics Canada and Human Resources and Social Development Canada could be put to effective use in developing both national and community-level strategies. The data could be used to identify the kinds of things we can do to improve the circumstances for people living in poverty and for communities that are particularly hard hit by poverty. That is our particular suggestion for this issue, and I apologize that I do not have all the numbers with me.
Senator Mercer: The problem continues to grow, we continue to search for answers, and we do not find them. I will go back to a comment made by Senator Mahovlich at the previous session. In many communities, people do not know that they are poor. They do not know they are poor until they compare themselves to someone else and everyone in the same pot. The purpose of this study is to examine and report on rural poverty. I might not be the one to make the following assumption because I am an urban dweller and have been most of my life, except for the past couple of years. However, poor people in cities and poor people in rural areas in Canada are different for different reasons. Overall, the cost of living is higher in the city; that is the downside. In rural areas the cost of living is lower but the amenities are fewer. In rural areas, parks are in the backyards. Recreation areas are probably closer to home because they are usually part of the home. In the city, they need to travel to find recreation and it is not always conveniently located in the middle of social housing projects. There are great examples of that in this country.
I would like you to affirm my thesis that for a person who is poor in rural Canada and a person who is poor in urban Canada, measuring their income level is not the real measure that we need to talk about. Rather, we need to talk about the measurement of the total cost of living in their respective rural or urban setting.
Mr. deGroot-Maggetti: I am not entirely sure how to answer that but I do know that in Newfoundland and Labrador, for example, where the provincial government has an official poverty-reduction strategy, they are working with Human Resources and Social Development Canada to tailor the market basket measure of poverty to develop a better picture of the cost of living in rural communities in Newfoundland and Labrador. The Government of Newfoundland and Labrador found that the measure produced by HRSDC did not suit their purposes as well as they would have liked. The benefit of that kind of measure and the benefit of a government having an official plan to reduce poverty combine to create a tool that they can utilize well. Also, it is a nice example of two levels of government collaborating to gain a better sense of what it costs to live in a specific community where the government is trying to make a difference.
Mr. Kits: That is effectively what the market basket measure of poverty can do. It is a matter of tailoring the market basket to a particular circumstance. You are suggesting, for example, what the market basket measure has done and that is to look at the difference between rural communities and urban centres in terms of the various costs for such things as transportation and housing, as well as other costs related to services. Then, that information is used to help determine what it will take in rural communities to ensure that people are not living below the poverty line.
Senator Mercer: You both work in a faith-based environment, which is commendable. My background is in the not- for-profit and volunteer sectors. I want to ask not only about faith-based activities and activities in social activism but also about all not-for-profit organizations and charities. Do you see the role of not-for-profits and charities expanding to reduce poverty?
Mr. Kits: I do not think it can expand at this time. My sense is that charities on the ground, whether faith-based or not, that deal with poor people in communities are stretched incredibly in terms of what they are able to do.
In part, that is because they made a commitment to be as close as possible to people, and to be as participatory as possible in people's lives to help work through the issues of poverty. They are not simply handing out a cheque; they are trying to create counselling, they are working with the food banks and so on. My sense is that they are struggling with that.
I have been at two conferences in the last several months of faith-based communities that want to address public policy issues. Coming out of their experience of working on the ground, they are saying we cannot do all of this. Something has to change in the way that poverty is dealt with in Canada — both in the broader economy in terms of available jobs, liveable incomes and those sorts of things, and the policies that are related in terms of minimum wages and other kinds of things — because somehow people are not able to make it.
I think it gets at the question that arose in the previous session a little bit, around the difference today compared to the past. I think our economy, lifestyle and way of living is such that community is not as strong. In the past, we would look to our neighbour for help if our tractor broke down: we would go over there for help and so on. More and more, as we become, in some sense, competitors in the global economy, there is a breakdown of that kind of thing. It is not as present any more.
These organizations are trying to create communities in some respects as much as they can. Food banks are rising in rural communities as well, trying to replace that loss of community in some ways, but the question is whether it is enough. I would argue, yes, that needs to be there because then you have the personal hands-on commitment. However, in addition, you need to deal with the structural questions of the availability of jobs, the challenges of the global economy for farming communities and so on, as well as what kinds of policies can be enacted in terms of welfare policy, minimum wages and other kinds of things that could address it.
Senator Mercer: Thus, there is a need for a national poverty reduction strategy.
I have one final question with respect to the role of non-profits in the community. I agree with your assessment that they do as much as they can with what they have. One of the things, though, that we need to recognize is that almost everyone who does this work is not in it for self gratification. They are in it because it is the right thing to do — it is the thing we do for each other.
It seems to me, however, that we, as a society, need to recognize that and to somehow champion that. We need to say somehow to those groups of people who volunteer, who serve at the food banks, who ladle out the soup at the soup kitchen, that what they do is important, it is valued by their fellow citizens and they need to be recognized for that in some way.
I do not know what that way is and I have been involved a long time in the non-profit world. A donor told me once when I gave him a recognition award that he did not need to be recognized. My comment was, yes, you do; I just have not found the right thing to recognize you with yet. What I have given you is not the proper recognition.
Do you see that need still there? Is there a need for us to say, collectively, thank you to people who work in the not- for-profit community, delivering services to the poor, helping the poor and giving them a hand up, not a handout?
Mr. deGroot-Maggetti: People can do a whole variety of voluntary community activities. Let me tell you a story about a mom whose son was in the same class as my son. We would meet together at school in the morning at the playground. We happened to have the same doctor. We would meet at the doctor's office. In fact, we had the same dentist and would meet at the dentist's office too.
Then one day I drove a neighbour to the food bank to get food, and there was this mother there. It took a long time to get her attention, and the first thing she said to me was, ``I hate having to come here.'' I thought to myself, hang on a second; both our children have a right to an education and neither of us feel ashamed about having to go to school and meeting each other at the school. For both of us, our children have the right to health care; we do not feel ashamed when we meet each other at the doctor's office. Why should we find ourselves in a situation where one of us feels ashamed because they need food for their children?
The dilemma is, where do we want to put our voluntary energy? So many churches are opening their doors right now, this winter, for people to sleep on mats in conditions that the UN High Commissioner for Refugees says violates their basic human rights.
People that go to food banks end up being put in difficult circumstances. I remember hearing a story of a woman who went to a food bank — and they are all running short on food so they have to ration it out. This woman came in and a volunteer, probably stressed out, lit into her saying, you cannot come back so many times. In this instance, she mistook her for someone else.
That kind of volunteering is necessary and, yes, we should recognize people for it. However, I would much rather see the kind of volunteering where parents volunteer in the classrooms and people volunteer with community arts and sports programs — things like that that actually enrich and build some of these assets for children.
We should provide some of those basic things that are a human right. Canada signed on to the human rights covenant on economic, social and cultural rights. We need to find ways to insure people can have those rights met that fully meet their right to dignity and do not rely only on voluntary activity, because voluntary activity is voluntary and if people do not volunteer, someone goes hungry.
Senator Mercer: This is my last comment. In some instances, providing those other services — coaching, helping in schools — is a nice thing to do, but it does not solve the problem. If the kids in the classroom do not have enough food in their stomach, or if there is violence at home — if mother or father is addicted to drugs or alcohol or there is no love in the family — as someone who has coached young people from the poorest part of town in a big city, I know that when they come to play baseball for me, it does not matter how much talent they have if they have not had a good meal. All the good work that I and other people put out and all the good things we give them to excel in sports will not work if they are not well fed and they do not feel appreciated beyond the seven innings of baseball they play.
Mr. Kits: I suggest that the other ways that we talk about how we address each other, what we owe for each other and how we care for each other are also through our economy and through our government. Perhaps one of the best ways that you, as representatives of government, can thank those who do this kind of activity is to find the more structural, big-picture ways to address poverty issues, so that those other kinds of things can begin.
There are multiple ways of ensuring that people are not poor. One of them is people who are able to volunteer their time and care for people in a personal way but the other is the larger picture of what is happening in the economy that perhaps government can find ways of alleviating in different kinds of programs — perhaps a guaranteed annual income for different folks and that sort of thing. What are some of the bigger policy things that can happen? How can we perhaps challenge, encourage and persuade business that it also is, in part, a representation of how we care for each other. Decisions that are made in business about jobs, availability of jobs and the kinds of things that are given in terms of recognition through pay and other things are ways of representing our care for each other.
Senator Segal: I want your advice on what I think is a philosophical complexity that we have on this issue.
I am one of those who believe that there are many things governments do well; nuanced social policy that is sensitive, person by person, is not one of them. The very structure of government, the ability to be sensitive as to why things in this house are different from things in that house is diminished for a host of reasons, not to mention privacy and other rules that now apply in the system.
What government tends to do effectively is provide for public education, for example. What government has done effectively for seniors, as our previous guest indicated, was basically eradicate large pockets of poverty among seniors by having a guaranteed annual income supplement, which we have had federally and provincially for decades now.
A simple test is point of access. Fill in your tax form. If your income is beneath a certain level and it is deemed to be the appropriate number, it is topped up. We are easily able to provide students who do not earn $30,000 a year a GST refundable tax credit, which goes into their account whether they pay any tax or not, providing they file.
Those things tend to be the limits of what we can do. For the rest we depend upon organizations like your own: community-based organizations, church groups and faith-based organizations, who are all about trying to show that sensitivity and do not have the myriad of rules and constraints. They may not have all the money they need, but they do not have that myriad of rules and constraints where they get caught up, for example, in a problem between fairness and sensitivity. Fairness implies you treat everyone the same; sensitivity implies that different people have different problems and we want to be responsive to that. It is hard to expect government to skate through that without having someone upset about the process.
That is one part of our philosophical problem in terms of trying to craft advice on the rural poverty issue.
The other is the question of motivation. We do not make a judgment about why seniors, who fall beneath a certain income level, have fallen beneath that level; we only send them the money. We say they are seniors, they are Canadians or permanent residents, they do not have enough to live on and then we send them the cash. We do not bring them into a detailed discussion of, was it because their husbands did not save enough money for the last 30 years, did they spend too much on cars or were they living in a house that was too big? We do not go there. We say, if you do not have enough we are there to help. That is our common human commitment between Canadians.
The references that you made, with respect to the Old Testament, are really about sharing the pie. If we think of the notion of jubilee, the notion of a debt holiday, the notion of tithing and always bringing the stranger into your midst and sharing what you have, it is about sharing the pie. Yet we know that part of the grinding economic reality is, if we do not grow the pie as well, we will not have sufficient to meet all the obligations we now have.
If you talk to Canadian farmers they are unresponsive to the notion of handouts or cash over the transom. They say, pay us a fair price for an honest day's work. Pay us a fair price for our commodity. That is how we want to earn an income. That is why we are farmers; we believe in what we do. The different pieces connect at different levels.
I noticed that the finance minister talked about an earned working income supplement last week, in an economic outline. Based on that document, the government is giving some thought to people who are working — I am referring to Mr. deGroot-Maggetti's individual that he referenced earlier — and earning only nine bucks an hour. That is not enough. The notion the finance minister talked about, I assume, is that for people who are working, and are still falling beneath the poverty line, there would be a refundable tax credit to bring them over the line. They must be working, however, to benefit therefrom so there is encouragement to stay in the workforce in one way, shape or form.
They would probably receive the money before they filed because of the way it is now done with the GST.
Governments must make choices. They cannot do it all; they cannot go in all directions. Based on your own work, based on your own organization's connection with people in difficulty, and your commitment to a community expression of our commonweal together, where would you go first and what would you do first? It does not have to be an institutional response, it can be your own individual feelings based on what you have seen and heard.
Mr. deGroot-Maggetti: In our estimation, what needs to happen first, and this is not the actual hands-on direct thing, is to lay out a strategy for addressing these things because the strategy must take into account what different groups can do. The federal government can do some things, the provincial governments can do some things, and poverty-reduction strategies are happening at the community level too. With a strategy like that, you can lay out particular steps in a particular budget. It may not get rid of poverty but it is part of an overall plan. There must be a plan that aims to eradicate poverty.
Senator Segal: Going back to the war on poverty by Lyndon Baines Johnson and Lester Pearson, we have had strategies, to use an inappropriate expression, piled knee high. The difficulty is you cannot eat a strategy if you are a farmer whose income has collapsed, you are having trouble hanging on to your farm equipment, the bank is knocking at the door and you have not had an increase in income, let alone a stable income, for 10 years. They do not want a strategy. They need help now.
Mr. deGroot-Maggetti: When the Government of Newfoundland and Labrador came out with a poverty reduction strategy, they held consultations to find out what things were needed. Even before they released the strategy in their spring budget, they laid out some specific measures that came out of those consultations. The government raised welfare rates, for example, and indexed them to inflation. Those things emerged from the consultations as part of the strategy.
Because the government had a strategy and because it was integrated, the Ministry of Education identified that, to make a significant impact on reducing poverty, they needed to put money into reducing school fees. If this fee reduction had gone through the regular budgetary process, it would not have been the first order of priority for the education ministry. Something like rewriting a curriculum would probably meet the education mandate first, but because the government had this integrated strategy across sectors, they could come together and the education ministry could identify that school fees were a significant barrier that excluded children from participating.
In some respects, it seems like we should be taking specific measures, but the measures will be more effective if they are part of an overall strategy.
Some countries have been successful in reducing poverty. Ireland had tremendous growth in the late 1990s and it was hoped that the economic growth would help everyone. Then they realized that without a specific concerted effort to ensure everyone was included, inequality was growing and poverty persisted, so they needed to make a concerted effort to reduce poverty.
That is much of our experience in Canada too. There are examples of strategic efforts to reduce poverty and — I do not want it to be reduced to semantics or another report — there must be real political will that these measures are about reducing poverty and not shifting around who spends what money.
That is part of the problem with what happened to the national child benefit supplement. It was supposed to reduce child poverty, but there were these other elements of wanting to increase workforce attachments and reduce intergovernmental complexity, which did not happen. What happened was that some of the poorest families were excluded from receiving that benefit.
Senator Segal: Because they were on welfare.
Mr. deGroot-Maggetti: Yes, and welfare rates were not increased, while the national child benefit supplement was.
To go back to the example of the working income tax benefit, something like the Canada Child Tax Benefit plays part of that role because businesses should pay a living wage, but should a business pay a family wage? That gets into the question of sensitivity. Business should not come into a house and pay more because there are six children. We set up programs that recognize, if a parent is working they should at least earn enough to cover their own expenses. When their jobs cannot pay more to cover the expenses of raising children, we have public programs that can help to meet those expenses.
Mr. Kits: To pick up on the philosophical problem of what someone has called the ``blunt tools of the state,'' those tools cannot identify every instance of difficulty. That is why we are moving more and more to the strategy side rather than picking on a particular item of policy. In effect, we are trying to figure out what that might look like by going into rural communities and listening to those who are living in difficult circumstances and, presumably, looking for the kinds of things that would make a difference. That could turn into a strategy. We might look at a whole range of different things related to trade policy in relationship to commodities, for example, if that is what farmers see as the most important thing to aid them. Perhaps it is a more immediate thing in terms of a guaranteed income or supplement.
We want to emphasize that it is about sharing and is not simply about the bottom base that someone needs. It is about how people can participate in communities and be part of society, and then thinking through what that might look like. Yes, some people do not need so much right now but, rather than starting everyone at the base, let us see this as a sharing kind of commitment to each other and determine what that commitment would take to accomplish. Some things might relate to alternative economic diversity strategies in rural communities. If part of the problem is that services are leaving communities, perhaps there is a way of encouraging them to come back. The kinds of things that need to happen are part of what we have looked at in the strategy.
Mr. deGroot-Maggetti: I will add one thing to illustrate again why having an integrated plan is important. St. Christopher House, a community agency in Toronto, conducted a research project called Community Undertaking Social Policy a number of years ago. All kinds of initiatives are going on at various levels to help people living in poverty. This study looked at seniors, families, the kinds of programs and services they received and how they interacted. They looked at seniors relying on Old Age Security, the Guaranteed Income Supplement, and possibly housing subsidies and the services of Meals on Wheels. All those services were income-tested so as their income went up a little bit they would lose a bit of subsidy for some of these. The remarkable thing they discovered was that for some low-income seniors, an extra dollar of income that they might have put aside in an RRSP or something like that, could cost them more than a dollar. When you are in receipt of the Guaranteed Income Supplement and Old Age Security, you lose 50 cents for each earned dollar. As well, you could lose some of the housing subsidy, as well as other subsidies.
No one wants poverty and everyone wants to do something about it. However, there is no coordination. In the study, they took a close look at how all these things interact and they found that similar things happened for families with children. Different measures available at one level of government or in one community could actually counteract measures available elsewhere.
Senator Segal: We know that when people try to break out of welfare, on their first $50 of non-welfare earnings, their effective rate of taxation for what they lose is 100 per cent. The wealthiest Canadians are taxed at about 53 per cent of the marginal high rate but for people trying to break out of welfare, their actual rate of taxation in terms of net loss of their benefits is 100 per cent. You are tackling a serious point.
Senator Mahovlich: What country would it be best to be poor in? Switzerland?
Mr. deGroot-Maggetti: I will turn the question around a little bit. In the earlier session, you talked about the problem of single parents and the high poverty rate among single parents. If you were a single parent, particularly a single mother, it would be best to live in Sweden. Sweden has about the same rate of single-parent households as Canada but the child and family poverty rate in Sweden is a fraction of what it is in Canada. Sweden has public programs designed to help not only the poor but also to help everyone. The programs are effective in preventing poverty, in reducing poverty and in supporting families.
It is said that many people are one paycheque away, an injury away or a family crisis away from living in poverty. We have done some remarkable things in Canada over the years to help people. Public education and public health care are good examples. What we have accomplished to reduce poverty among seniors is also a good example. If you are a senior citizen, where is a good place to live: in Canada, but can we make it that way for everyone else?
With apologies, I did not answer the question the way in which you posed it.
Senator Mahovlich: You both studied in the United States. Does one state differ from another as far as poverty goes?
Mr. Kits: I do not know the exact answer but, yes they differ. It has to do with the difference in programs and resources available, and the cost of living in particular communities.
Senator Mahovlich: Some communities are more charitable and some states are more charitable than others?
Mr. deGroot-Maggetti: Some of the research I have seen, in particular around the question of social capital, has examined inequality in the United States. It seems that states closer to Canada have lower inequalities than other states, although I am not exactly sure why that is. Other research has been conducted around minimum wage rates and the impact of raising the minimum wage. In that area, they have been able to compare states because some states raised the minimum wage while others kept it at the federal rate. That comparison has provided some good information about the impacts of raising the minimum wage. Some of the fears about the impact it would have on low-wage jobs or in the service and retail sector did not seem to materialize as people had expected it to. Interesting information is available from these studies, although I do not have much detailed information with me.
Senator Gustafson: Both of you indicated that you are with faith-based works. One positive thing that our government has is exemptions for charitable donations. Much of that is likely left unused. People with large incomes can donate up to 20 per cent of their income and, in some cases, more.
I have a lot of faith in faith-based operations because they do it well and, for the most part, without any charge. They donate the work both internationally, in countries such as Africa, and nationally.
Canadians are generous in their donations. Of course, the last thing I would want to see is our government changing the charitable donation limit. I want the government to keep it as it is now. At the same time, it is a great responsibility for faith groups that the donations not be abused and that they go where people intend.
I will use the example of the Canadian Foodgrains Bank, with which you might be familiar. The little town of Lampman, Saskatchewan, called to ask for two hopper cars of wheat. They received 12 hopper cars of wheat.
One small farmer and former immigrant from Germany told a news reporter that he had lived on rutabaga for the best part of a year and that was all they had to eat during the war years in Germany. He said he would gladly give a small truckload of wheat to help somebody else.
I think that is the mood of the Canadian people. My question is, what can governments do, and what can we, as individuals, do to strengthen that mood, which is already good? In my opinion, it is the best; but what can be done to improve it?
Mr. Kits: I think the challenge, perhaps, that we need to think about is on the receiving end. Senator Segal said farmers would much prefer to sell their grain at a reasonable price rather than accept a handout from either their community or from the government. That is one challenge we need to think about.
It is important that people continue to be generous and to care for others and serve them. However, the bigger challenge is to figure out how you can do that in a way that maintains people's dignity, that allows them to find work and that allows them to find the opportunities to care for their children as much as they can while earning an income in whatever ways work best.
There is a combination of things. We need to continue to encourage generosity and care but we also need to look at ensuring that farmers can sell their gain, finding another kind of occupation at some point for the younger people or whatever you hear out there about what people are looking for. It is not simply charity, although that is important; it is the longer-term development of their capacities and ensuring that they continue to have assets in their farm that they can make use of, assets that will not drain them to the point where they need to do that. Then, allow us to use that charitable response in ways to enrich our lives together.
The message we hear from those communities on the ground that are doing that kind of charitable work is that the bigger structural stuff needs to come into play more so that they are not just stretched to the end to make a difference.
Mr. deGroot-Maggetti: I have a few comments. One way that could help, I gave the example of a lot of churches opening their doors for their out-of-the-cold programs, but a lot of faith communities would love to build affordable housing. In a lot of the projects that were built in the past, when there was a federal housing program to build affordable housing, faith communities and other community groups built them. They could also build in social amenities — space for people to create community and not be warehoused, as happens in church basements and church halls. That is a case where we could have the charitable tax receipts for donations working in tandem with a program to fund the building of housing. Government can use both those important tools.
I read some of the testimony from some previous presenters. One thing that struck me was that often when we talk about poverty we individualize it. One of the most interesting things I read from some of the previous testimony was looking at structural things such as where rural communities are in relation to even small urban centres, and what impact that can have on maintaining the health and vitality of rural communities. If there is a healthy and vital rural community, then, of course, individuals and households will do better.
Another example I found fascinating was colleges and universities that are placed in rural communities, and the kind of synergy that can be created between those universities, colleges and the local rural economy. As I understood from some of the presenters, it goes even beyond the agricultural economy: that there are other facets of economic life in rural areas.
That struck me as interesting — extending the lens beyond looking at the individual in the household, but the communities that they live within and the kinds of community assets available to create strong and healthy communities.
Senator Gustafson: One program that seems to work well, in my thinking, is the senior citizen homes that are looked after by charitable donation organizations such as different churches and so on. While the government may put up the money to build the home, the organization can do a good job of administering it. That is happening widely in Canada, as I understand. Do you have any comment on that?
Mr. Kits: That is, again, pulling together the resources of government and the commitment to making sure that seniors have housing and so on, while working with communities that are communities of commitment — whether that is a particular church community or whatever — working together and finding the ways to do it. However, it would take the wider resources that government might have to pull together to help make that happen, rather than what is available in a particular community. Again, it is taking the partnership one step further.
Senator Gustafson: That has a return benefit, too, because as the government strengthens the community, it takes the burden off the government in under-girding it.
Senator Tkachuk: You mentioned food banks earlier on, and then food banks in rural areas. Are food banks effective?
Mr. deGroot-Maggetti: Effective in what sense?
Senator Tkachuk: If you give away food, you can have a lineup, so you do not know who these people are. Does anyone know if they are poor? In other words, are people taking advantage of the system, which would hurt the people that are poor? They only hand out food. That is what they do at the food bank.
Mr. Kits: No, they do not only hand out food.
Senator Tkachuk: Then I would like to know about that.
Mr. Kits: More and more, the restrictions on the availability of food are increasing because the food banks cannot keep up as well. I heard it from a woman today who was talking about her experiences at the food bank, and now her advocacy with others who are poor. There are circumstances where, if you are on welfare, you can come to the food bank only three times in a month, for example. If you are on disability, you can come five times; those are the restrictions that are there. An incredible number of questions are put into place at the food banks to make sure that you are truly poor.
The difficulty for people who are truly poor is that they come and they are interrogated. As was mentioned before, we do not ask the same questions of seniors often, though there are seniors who also go to food banks and who are probably asked the same questions.
The challenge is to figure out a way that, with as much dignity as possible, people can find a way of getting the resources they need. The food bank is becoming a more difficult place for that kind of thing to happen.
The ideal for people is a job. If you talk to people on welfare, the vast majority of them would love to be working, just like the farmer would prefer to sell his food. Some people will take advantage, just as some people cheat on their taxes and do other things like that. That is always the case. As Christians, we would argue there is sin in the world; but the challenge is, for us as a community, to be as generous as possible to make sure that people can find a way, with dignity, to have enough food, to have enough resources, to have the time to spend with their kids and all those kinds of things.
Senator Tkachuk: You do not have dignity when there is free stuff. Here on the Hill, an organization hands out cosmetics. They put on a thing every year, and all the MPs, senators and staffers line up for a bag. What is that? My point is that people swallow their dignity easily. We do that for candy, for God's sake. Some organizations hand out bags of candy at Christmas and everyone goes.
Even all the big movie actors and actresses all expect a free bag of stuff at the Academy Awards. These people are making $20 million a movie. People are people. It is not sinful to lose your dignity. It is just awful; it is bad form. People line up. If you give them free food, people line up and take the food. There is nothing wrong with sorting people out and saying, this person needs it. When people donate food they want it to go to people who need the food; they do not want it to go to people who do not need the food. It is the responsibility of organizations to give food to people who need it. It is also their responsibility to show some kind of class in how they ask the questions. Surely there is nothing wrong in asking the questions.
Mr. deGroot-Maggetti: It is not always as easy to go to the food banks for food.
Senator Tkachuk: I should try it to find out if I could get food. I do not know.
Mr. deGroot-Maggetti: The thing to do is push a stroller and hold another child in your arms, get on the bus, go to the food bank, which may not be close to where you live, then get a box or bag of food, get back on the bus with your stroller and your child and go home.
I also do not want to paint the picture that food banks are awful places because people working in those places do great things. They are becoming multi-service agencies. They do employment training as well. Some try to increase the dignity and create community involvement, community gardens. People are trying to do all kinds of creative things in communities, and the Canadian Association of Food Banks is trying to be effective and efficient in making sure that people's basic food needs are met. However, the Canadian Association of Food Banks, when they released their hunger count, which I believe they released this morning, always include these kinds of public measures that need to be taken by government because we cannot keep relying on food banks as much as we are.
They can try to be as effective as they can in meeting emergency food needs, but if we really want to be effective in providing food security in Canada, we need to go beyond the food bank solution.
Senator Tkachuk: I am asking the questions not to be a mean person, but when we are studying poverty in rural Canada we need to look at solutions, too, so all these solutions are out there. In my lifetime I have seen a lot of solutions and we still have poor people. Maybe your idea of a national strategy might work. I would like to learn more about that Newfoundland and Labrador thing, and Ireland. That is interesting stuff, Madam Chairman. We should have witnesses telling us what they do there and to give us numbers to find out if it is effective or not. I will leave that. Maybe we will not need food banks.
Mr. Kits: I think food banks would prefer not to exist. If wider structures allowed people to find opportunities for food, employment and other kinds of things, and food banks would not need to exist, I think they would be happy to go out of business.
The Chairman: You said something, Mr. deGroot-Maggetti, that caused a light to go off in my head as we listened to all the different things that cause poverty. You mentioned the word Sweden and how, in comparative terms, on many of these issues we would have a difficult time keeping up with the kind of work that Sweden does.
The thing that cropped into my mind was that Sweden is one of our trading partners and allies, and in comparative terms to Canada, has one of the highest literacy systems in the world. We do not. In a prosperous, caring country that we like to think of, something like 42 per cent of our adults are at risk every day because of their inability to read, write, communicate, get a job and all these kinds of thing, including help their children learn.
In your situation, in the work that you do, do you run across this problem in any evident way? It is there, and I think, as we go along with our committee, we will find that this problem also is one of the issues, be it rural or urban, that prevents people in our country from having a fair chance.
Mr. deGroot-Maggetti: That is a good question. It would be worthwhile examining what other countries have done successfully to reduce and prevent poverty and to build people's capabilities around literacy, for example.
That question is philosophical, I think. In countries such as Sweden — and Sweden is not alone here, but in European countries, particularly northern European countries — their social philosophy is more one of solidarity and that philosophy takes into account structures that influence people's lives.
Sweden or Norway has spent 40 or 50 years trying to build systems. The other day someone told me they talked to someone from Sweden about the working poor and the person said, what do you mean the working poor? When we suggest a working income tax benefit to make sure people who are working earn enough to keep them above the poverty line, people from there look at you. Their thinking is if a business cannot pay a living wage, is it really a sustainable business? They have built systems of training and education over 40 or 50 years, life-long associations that even low-wage workers have possibilities for training and education throughout their work life, to continue to be able to move up.
If we want to achieve those kinds of low rates of poverty, it will be a long-term task, but it needs to be one about investing in people and communities in a whole host of ways.
The Chairman: Thank you for reminding me that this, too, is a part, and listening to all my colleagues, that the ability to read, write and communicate is at the core of a great many of these problems in families in Canada.
Senator Tkachuk: Do Sweden and Norway let in a lot of immigrants? I do not think so.
The Chairman: At any rate, this has been an interesting visit, and we thank you for your patience tonight as well.
The committee adjourned.