Up To 25% of Canadians Could Be Living in Poverty, Says New Report

A fresh report from Food Banks Canada reveals that poverty levels in Canada might be more severe than previously estimated, suggesting that up to 25% of Canadians could be living in poverty due to their inability to afford two or more essential household items.

Released on Tuesday, the report introduced a material deprivation index (MDI), a new metric inspired by European standards to assess poverty levels. This index used widely in Europe, helps differentiate between those who cannot afford essential goods and services and those who choose not to have them.

Richard Matern, Food Banks Canada’s director of research, emphasized the need for continued focus on poverty reduction. He stated to Global News, “Many more people are feeling the impacts of poverty.”

The MDI examines 11 essential items that many Canadians reported they could not afford. These include basic necessities like clothing, which 10% of respondents couldn’t afford, and dental care, which 18% couldn’t pay for. The findings suggest that around 25% of Canadians, translating to 10 million people, live under a poverty-level standard of living because they cannot afford at least two of these essentials. This is a stark contrast to Statistics Canada’s report, which estimates only four million Canadians are living in poverty.

Matern noted that the report also considered other indicators such as food insecurity, economic distress, self-reported income adequacy, and actual income levels. “It’s very striking,” Matern remarked. “When you combine all these four indicators, it basically highlighted statistically that two or more items were most representative of the majority of people experiencing struggles in those other areas as well. So essentially what we call the threshold.”

Typically, Canada’s poverty assessment uses the Market Basket Measure, which defines poverty based on the ability to afford a modest standard of living, covering essential costs like food, clothing, transportation, and shelter. However, Matern pointed out that factors such as assets, debt, rent variations, and disabilities also significantly impact living standards.

Under the traditional measure, nearly 10% of Canadians live in poverty, but the report’s authors argue that the MDI could offer deeper insights. Sarah Stern, executive director of the Maple Leaf Centre for Food Security, stated, “Developing and maintaining an MDI alongside existing income-based poverty measures could provide the government with deeper insights to enhance programs to reach more of those experiencing food insecurity.”

The report highlights that single-parent families and young adults aged 18 to 30 are most affected, with 44.5% and 30% respectively falling under the MDI poverty category. Additionally, 42% of renters face challenges affording two or more essential household items, placing them at a poverty-level standard of living.

The report underscores that poverty in Canada is likely more extensive and complex than what income-based measures alone can reveal, calling for a multifaceted approach to tackle the issue effectively.