Ontario: worst for growing poverty and inequality

A report released today by the Ontario Common Front, a coalition of over 90 groups and organizations, states that Ontario is dead last in terms of growing poverty rates, rising inequality and spending on public services.  While Ontario established a poverty action plan in 2009, there has been little change in the numbers, and therefore little change in improving the well-being of Ontarians.  Without funding and action, this is likely to stay the same or even become worse.

According to the report, titled “Falling Behind: Ontario’s Backslide into Widening Inequality, Growing Poverty and Cuts to Social Programs”, between 1981 and 2010 Ontario had the largest change in income inequality in the country – which  means that very few people did extremely well, while the majority of people saw income stagnate, or decline.

Sid Ryan the President of the Ontario Federation of Labour stated in the press release, “Most people would be shocked to know that Ontario has seen the largest increase in income inequality and the second largest jump in poverty rates in all of Canada…By cutting vital programs instead of reversing a decade of corporate tax cuts, the government is handing our wealth over to bankers and CEOs. It is exacerbating inequality.”

Add to this the fact that Ontario is reported in last place in terms of funding for social programs – highest number of people paying for health care services, highest tuition fees and school fees.  This is at a time when Ontario has lead the country in corporate tax cuts.  It is easy to see the parallel here.  Without adequate funding from a strong, progressive tax base, social services suffer, and those who are most affected are the vulnerable populations.  The business sector has a critical role to play in not only providing jobs that offer fair wages and benefits, but also in paying their fair share.  After all, the consumers they so rely on are the population that they often short change.

Studies have shown that cost savings that business would reap if poverty was reduced and ultimately eliminated.   Billions are to be saved and made through: higher worker retention, a healthier workforce (mentally and physically), larger pool of educated employees, and more money going into the economy as incomes rise and people have the money to spend.  The Ontario Association of Food Banks reported that lost productivity alone costs $8.6 – $13 billion across Canada.  Imagine how this would fuel Canada’s economic engine.

One reason for further worry is the austerity agenda the Ontario government has adopted as of June this year.  The budget approved a myriad of funding cuts – from social assistance funding, to emergencies for school closures, cancelled hospital projects, and delayed child benefits.  Job losses in the public sector and weakened affordable housing funds round off a list of detrimental cuts that are setting the stage for more individuals and families to struggle.  See the summary report for brief details of the cuts.

Housing is a critical element to alleviating poverty and improving mental and physical health.  In Ontario there were 156,358 households waiting for affordable housing as of Dec 31 2011.  This is an increase of 26% over the last five years.  The Common Front reports that for the fourth year in a row, housing cuts are to be expected as 12% reduction is slated for the coming year.

The numbers are moving in the wrong direction, and this is a province with a poverty plan (for more information on this plan see CWP’s Poverty Progress Profiles).  It is clear that a strategy is not enough; political will remains the driving force behind the success of poverty reduction.  With all of the knowledge on the human and financial costs versus savings, it is clear that action is necessary for greater prosperity for all in Canada.