Editorial: Raise benefits to fight poverty

According to the children’s advocacy group First Call B.C., Port Alberni and Duncan together have the worst child-poverty rates in the province. The group reports that 31 per cent of children in these two communities live in low-income families, compared to 20 per cent provincewide.

While child poverty is a massive challenge for our province — we’ll return to that below — it must be said at the outset that First Call’s numbers are misleading.

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When calculating the number of kids in low-income families, the group used the national poverty line. That’s a serious problem, because incomes in the mid-Island across all salary groupings are well below national averages.

So, too, is the cost of living, meaning a dollar goes further. If more appropriate local weightings were used, the reported poverty rate would fall by an appreciable amount.

That said, B.C. has long had more than its share of child poverty. And it’s disturbing in particular that Port Alberni and Duncan top the provincial chart, given their proximity to a wealthy community such as Victoria.

It appears two factors play a prominent role. Both communities have very high numbers of single-parent families. In Port Alberni, 37.5 per cent of families have only one parent at home, well above the provincial average of 27 per cent.

And 17 per cent of Alberni Valley residents are First Nations members, compared to the provincial average of five per cent. Aboriginal families are more vulnerable to poverty for both historical and geographic reasons.

The question is what should be done. Some advocacy groups would like to see our minimum wage, currently set at $10.45 an hour, raised to $15. B.C. has one of the lowest minimum wages in Canada.

Economists are divided, however, on whether this would help or hurt. The benefit of a higher income scale might be cancelled out if jobs are killed in the process.

A better solution would be wholesale reform of the low-income safety net. At present, single-parent families with two children are eligible for $22,274 in annual benefits.

By itself, that’s not enough to get by on.

But the situation is made worse by the labyrinth of programs used to deliver these benefits. There are nine in all, from housing allowances and child-care benefits to tax credits and income supplements.

Canada once had a much simpler way of helping those in difficulty — the family allowance, which combined most forms of support in one simple program.

But governments were fearful of angering voters by giving the poor a highly visible benefit no one else received. So everyone got the allowance, which was then taxed back at higher income levels. Politics at its worst.

The family allowance was scrapped in the 1980s and replaced by the current piecemeal approach, which is supposedly more palatable. Benefit levels are now easier to disguise, and voters seem comfortable with directed subsidies such as housing allowances.

It’s time to get rid of this nonsense. Dump all the existing income-assistance programs. Replace them with a single benefit — the family allowance. Make it available, on a graduated scale, only to families with incomes less than a living wage.

And set the benefit level high enough that child poverty is either eliminated or, at a minimum, greatly reduced.

What might this cost? The province spends $1.7 billion on income assistance — the largest single expenditure on low-income families.

Raise that 20 per cent, and the cost would be $340 million. That should lift thousands of families out of poverty.

Not a small amount, but worth every penny.

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