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National Finance

Motion to Authorize Committee to Study a Road Map for Post-pandemic Economic and Social Policy to Address Human, Social and Financial Costs of Economic Marginalization and Inequality--Debate Adjourned

November 25, 2021

Pursuant to notice of November 24, 2021, moved:

That the Standing Senate Committee on National Finance be authorized to examine and report on a road map for post-pandemic economic and social policy to address the human, social and financial costs of economic marginalization and inequality, when and if the committee is formed;

That, given recent calls for action from Indigenous, provincial, territorial and municipal jurisdictions, the committee examine in particular potential national approaches to inter-jurisdictional collaboration to implement a guaranteed livable basic income; and

That the committee submit its final report no later than December 31, 2022.

She said: Honourable senators, I rise to speak to Motion No. 6 to authorize the Standing Senate Committee on National Finance to examine and report, no later than December 31, 2022, on a roadmap for post-pandemic economic recovery that incorporates the urgent need to address the human, social and financial costs of economic marginalization and inequality.

This pandemic has been likened to a storm at sea. While some of us are on a sturdy, multi-storey, well-serviced, stable ship with robust engines, others face the same waves without even a life preserver, let alone a rowboat minus the oars. This pandemic has not affected everyone equally.

During the first year of the pandemic, the financial situations of one in five Canadians, primarily those with incomes over $100,000, improved. People like us were relatively well protected. Our jobs and our income were never in peril because of the pandemic. Meanwhile, for far too many, the situation was dire. Canada’s unemployment rates skyrocketed to heights not seen since the Great Depression.

In responding to the pandemic, the government has stated that a healthy, resilient and vibrant economy is an economy “for all.” Canada’s economy does best when we uphold values of substantive equality, when the economy is inclusive and when no one is abandoned to poverty or prevented by poverty from contributing to their communities to their full potential.

The government created laudable financial supports, such as the Canada Emergency Response Benefit, to ensure safety and dignity for individuals and stability for economies. And yet, by design, these “life preservers” did not reach those most in need.

Those who were on social assistance and were unable to work prior to the implementation of CERB could not access the program, which offered previously employed folks $2,000 per month.

How do you think the average child leaving care fared in Toronto, for example, with $390 for housing and $343 for food every month, or how the average single mom fared each month in isolation trying to obtain housing for less than $700 and nutritious food for her and her children for $360 per month?

Too many of those who received the CERB also faced desperate financial situations. According to media reports, for people with disabilities and for close to 90,000 low-income seniors, drawing CERB in the past means that they now cannot access the full amounts of income supports they would usually rely on. The situation is particularly stark for many who received CERB in good faith, but now face repayment orders on top of receiving less of their usual entitlements. Their struggles echo those of other marginalized groups, particularly recipients of provincial and territorial social assistance and youth transitioning out of state child welfare “care.”

The pandemic policies excluded those most vulnerable and marginalized, leaving them in the lurch. The results are devastating from both a financial and a human and social perspective. Two in five Canadians — those with the least, those living in poverty — struggle every day with the stressful realities of hunger, housing and personal insecurity, in addition to the spectre of illness and homelessness.

This week, the government listed addressing child poverty as one of its priorities in the Speech from the Throne. According to the report card just released by Campaign 2000, more than 1.3 million children — nearly one in five of those who represent Canada’s future — are growing up in poverty, deprived of necessities and opportunities that have become intergenerational. The chasm between children who have and those who do not is wide and deep.

The Canada child benefit is also lifting fewer people out of poverty than when it was introduced. It is not providing sufficient support to those in profound poverty.

On the housing front, things are just as dire. More than 250,000 households in Canada have accumulated over $350 million in rental arrears since the onset of the pandemic. Though the National Housing Strategy aims to build 150,000 new units of housing over the next 10 years, approximately 235,000 individuals experience homelessness each year and 1.7 million households lack the housing they need.

Black and Indigenous peoples are 2.7 times more likely than the overall population to report incomes inadequate to allow them to pay rent. Of Indigenous people in urban centres, 1 in 15 will experience homelessness, compared to 1 in 128 for the general population.

Failing to address poverty also carries punitive economic costs for government and for all of us. Indeed, the cost of poverty in Ontario is conservatively estimated at $27.1 billion to $33 billion per year, and $72 billion to $84 billion per year in Canada in the forms of lost tax revenue, health care, prison and legal system costs.

Let’s consider poverty in the context of health care. Living in poverty doubles or triples the chances of developing diabetes and complications such as blindness and cardiovascular disease. On a human level, this is unacceptable. However, if that weren’t enough, poverty also results in an estimated additional $7.6 billion cost to the Canadian health care system.

And what about poverty in the context of the criminal legal system? Of women in prison, 80% are there for poverty-related crimes. The most common convictions for Indigenous women are theft under $5,000, theft over $5,000, fraud, and trafficking drugs or stolen goods. Most of the women convicted of violent “offences” are criminalized as a result of their attempts to negotiate poverty, violence and racism.

In this light, it is not surprising that the Public Health Agency of Canada stated in 2008 that:

. . . $1 invested in the early years saves between $3 and $9 in future spending on the health and criminal justice systems, as well as on social assistance. . . .

Honourable colleagues, despite these glaring inequities, the situation is remediable. We can work together to reduce these disparities. We can and we must work to find the best path forward. This study could help us to lead the way.

At the height of the pandemic in 2020, the National Finance Committee recommended, among other measures, examination of the potential of a guaranteed livable basic income to unite and align human, social and economic well-being. This study would allow the committee to delve into this question in an in-depth and expanded way, considering issues including the role of the federal government and the federal spending power in light of the intersection between federal, provincial and territorial responsibilities, programs and finances; the relationship between Indigenous nations and the federal government and economic approaches to decolonization; as well as issues of design and cost of programs, including potential examination of tax fairness and reform.

This study could allow us to examine how, for instance, here in Ontario, despite the pandemic, Dufferin County reduced chronic homelessness in its community by 50% thanks to a combination of housing allowances and support services; how Guelph and Wellington County reduced chronic youth homelessness by 43% during the first year of the pandemic; how London, Ontario, ended homelessness for veterans; and how Medicine Hat, Alberta, became the first city in Canada to end chronic homelessness.

This motion aims to map a way forward for inter-jurisdictional collaboration to economic recovery that prioritizes overall well-being, not merely GDP. Economic recovery must include poverty eradication within the context of social, gender and racial equality.

This month marks the fiftieth anniversary of the 1971 Croll report, from the Special Senate Committee on Poverty. This committee recommended that:

. . . the Government of Canada implement a Guaranteed Annual Income . . . on a . . . national basis . . . financed and administered by the Government of Canada.

Since then, the 1985 Royal Commission of the Economic Union and Development Prospects for Canada recommended:

. . . the provision of a Universal Income Security Program with relatively low guarantee levels and tax-back rates is an appropriate long-term goal for the Government of Canada and the provincial governments to pursue . . .

In 2008, former Conservative senator Hugh Segal and former Liberal Senator Art Eggleton championed guaranteed livable income in this chamber and beyond. As a result, the report of the Senate Subcommittee on Cities recommended a federal annual income replace the current provincial and social assistance schemes.

Just four years ago, this chamber passed Senator Eggleton’s motion calling on the government to support provincial, territorial and Indigenous initiatives aimed at evaluating the cost and impact of guaranteed livable income programs.

Two years ago, the National Inquiry into Missing and Murdered Indigenous Women and Girls called on the government to implement this fiscally responsible step to addressing the needs of Indigenous women in order to assist them to escape violence, homelessness, prison and death.

Honourable colleagues, interest in a guaranteed livable basic income is far from new. What’s more, it’s absolutely doable. The Parliamentary Budget Officer provided one example of a way guaranteed livable basic income could be achieved at a net-zero cost. Dr. Evelyn Forget and other progressive economists have proposed additional approaches. In B.C., an incremental approach was advocated.

Virtually everyone agrees on replacing existing provincial and territorial social assistance programs with income-tested cash transfers that provide resources sufficient to live on. Prince Edward Island is looking for federal assistance to implement a basic income guarantee.

Over five years, a guaranteed livable income could increase GDP by between 1.6% and 2.4%, create between $46 billion and $80 billion in new government revenues, and create between 298,000 and 450,000 new jobs. The potential to increase economic growth and human well-being is obvious.

Honourable colleagues, two out of three people in Canada believe implementing a guaranteed livable income to ensure that everyone can afford basic necessities is the right thing to do. This motion reflects the reality that we must make additional effort to consider those who are too often left behind or forgotten when we think of national recovery.

Currently, acute financial problems can result in chronic poverty. It can happen to those who least expect it; those trying to escape violence in their homes; those expected to care for their children, elders or people with disabilities; those who lose their jobs; and those who have health challenges.

Poverty shortens life expectancy by some 21 years.

Poverty intersects with and worsens systemic racism in gendered ways. Racialized women are 48% more likely to be unemployed and earn 55.6% the income of non-racialized men.

Senators, the aim of this motion is to enable us in this place to do what we do so well: namely, taking into account the interests of those whose needs are not front and centre in the other place. Let’s work to ensure that every Canadian is considered as we map the road to recovery. I look forward to working with each and every one of you and to honouring the legacy of those who have gone before us as well as the interests of those who have yet to be considered.

Thank you. Meegwetch.

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