National Post

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Thursday, January 13, 2000

StatsCan change could swell ranks of 'poor'
Mark Stevenson
National Post

Statistics Canada is considering changing the way it defines low-income earners in a move that could classify significantly more Canadians as poor.

The definition is important because it is a hotly debated and influential yardstick that is used to determine such things as how social programs are delivered and who receives them.

Although it is updated regularly to take inflation into account, the low-income cutoff level of $32,759 for a family of four is based on eight-year-old data on the average spending on food, shelter and clothing, said Cathy Cotton, a Statistics Canada spokeswoman.

StatsCan is considering raising that cut-off level to $33,356, to reflect recent changes in spending on necessities.

That would put 18.9% of all Canadians -- an additional 1.4% -- below the low-income cutoff level, said Ms. Cotton.

"The cut-off line moves a little bit higher and more people or families fall below that line and they're counted in the low-income level," she said.

More people may be defined as poor even if their income rises, as long as they are spending a larger percentage of their money on food, clothing and shelter relative to the increasingly better-off average Canadian, she said.

The agency does not call the low-income cut-off Canada's poverty line, but it is used as one by anti-poverty groups because it compares Canada's poor to more wealthy Canadians in relative terms.

Critics of the StatsCan calculation say it is a measure of income disparity, not poverty.

"The problem is that it is at best a measurement of inequality. It measures how many of us are doing compared to the average," said Patrick Basham of the Fraser Institute, a Vancouver-based think-tank.

"The country and most Canadians can be getting better off and yet the low income cut-off could get larger. It measures how my neighbour is doing relative to me."

Poverty groups maintain the index is useful.

"For us there is good value in the relative nature of the index because poverty is a measure not only of actual dollars coming to a household but how it is surviving relative to other households in the country," said Laurie Rektor, executive director of the National Anti-Poverty Organization.

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