A recent Statistics Canada model projects Canada’s official poverty rate to reach 10.2% in 2023.
In a recent research paper titled “Modelled Market Basket Measure poverty rates for 2022 and 2023,” Statistics Canada unveiled projections indicating a potential surge in Canada’s official poverty rate.
According to one of the models employed by the federal data centre, the poverty rate is expected to climb to 10.2% in 2023, marking a significant increase from the estimated 7.4% in 2021.
The model suggests a steep trajectory, with a 21.8% rise from 2021 to 2022 and an additional 13.3% increase forecasted for the subsequent year. The official poverty rates for 2022 and 2023 have yet to be officially disclosed.
Statistics Canada arrived at the projection using the latest data from the distributions of household economic accounts, the Canadian Income Survey and the most recent Consumer Price Index.
Renze Nauta, the work and economics program director at think tank Cardus, shared insights on the concerning statistics with True North.
Nauta emphasized the importance of addressing the root causes of poverty over patchwork solutions, pointing to the think tank’s past reasearch.
“The best way to reverse the trend of increasing poverty in Canada is to make sure that everyone who can work has the opportunity to get a good-quality job,” said Nauta.
“We need to ensure that the working class has more opportunities to flourish in the labour market.”
Nauta specifically highlighted the need to create employment opportunities for people with disabilities, who face a higher risk of living in poverty.
“The federal government is currently in the process of designing a new Canada Disability Benefit, which could help or detract from this opportunity. It is crucial that the Canada Disability Benefit include employment incentives to ensure that people with disabilities who can work do not face barriers in entering the labour force,” said Nauta.
“Another thing that would help would be to reform the way governments handle gambling revenue. We know that low-income families lose a disproportionately high amount of their incomes to gambling. So, instead of putting those dollars into their general income funds, governments should return that money to those living in poverty or at risk of falling into poverty.”
Additionally, Nauta said that governments need to give people living in poverty better financing alternatives, as current options, such as payday loans, are predatory.
“Folks who have no credit and need emergency cash to pay unexpected bills need safer options than payday loans. Capping interest rates does nothing to help low-income families if it means that they can no longer access credit markets,” said Nauta.
