The C.D. Howe Institute released a study yesterday showing that poverty has declined in Canada over the past decade or two.
Contrary to the dismal picture that some recent studies have painted, the income security system is not broken, he [John Richards] says. Policies of the last decade got much right. In 1996, nearly 16 percent of all Canadians fell below the Low Income Cut Off, the traditional measure of poverty in Canada. In 2005, less than 11 percent of Canadians did so. In the same period, the poverty rate among children in female lone parent families fell from 56 to 33 percent; among single men from 38 to 32 percent; among single women from 47 to 37 percent. Among these three vulnerable groups, there was a steady increase in median incomes, primarily due to greater market earnings, not to increases in net transfers....
Professor Richards concludes that the impact on employment among those at high risk of incurring poverty should always be a consideration when assessing proposed policy reforms, and policies that create greater incentives to enter the workforce make sense.
While the overall poverty situation is improving in Canada, there are still pockets of poverty that appear resistant to policy interventions, he notes. He identifies six dossiers that require attention: education among the poor; Aboriginal poverty; the mentally ill and physically handicapped; those living in ghetto-like urban neighbourhoods; high effective tax rates on the “near poor”; and in-work benefits (such as earning supplements).
Refined interventions are required, not broad new transfer programs, he concludes.