By John Kolkman, Research Coordinator, Edmonton Social Planning Council
July 20, 2011
An older homeless man squats in the entrance to an inner-city building. Alberta's next premier should tackle the growing number of citizens living in poverty.
Photograph by: Candace Elliott, The Journal, File, Edmonton Journal
Alberta's next premier should stick with the 10-year plan to end homelessness; in fact he or she should use it as a template to end poverty.
Entering its third year, it is the most visionary social policy initiative of the current government and has achieved good results, meeting or exceeding most of the interim targets in all of Alberta's major urban centres.
Some of this early progress can be attributed to good timing since the plan was launched just as vacancy rates were rising. This made it attractive for landlords to rent to homeless persons knowing the rent would be paid. Now, with vacancy rates dropping in most Alberta communities, including Edmonton and Calgary, and with rents likely to rise, it will be important for Alberta's next premier to ensure that sufficient monies are invested to meet the goal of ending chronic homelessness in our province.
In the same way the Stelmach government tackled homelessness, the next premier should also tackle poverty. Six other provinces and the three territories are already implementing or have adopted strategies for reducing and eventually eliminating poverty.
Housing is the single biggest expense for most low-income Albertans and the next premier should use the homelessness plan as a template for implementing a comprehensive poverty-elimination strategy. Like the homelessness plan, a poverty-reduction plan could include a 10-year time frame with specific targets and benchmarks to measure progress.
The introduction of a refundable Alberta Child Tax Benefit would be the single most effective measure to reduce child and family poverty.
By piggybacking on existing federal child tax benefits, there would be no additional administrative cost. Unlike social assistance, child tax benefits do not discriminate based on source of income, so working poor Alberta families also qualify. Moreover, the level of child tax benefits are based solely on income as reported on a yearly tax return. Social assistance can keep low income people trapped in poverty by requiring them to sell assets like their homes or vehicles before they are eligible to receive assistance.
Another key policy measure is rewarding work.
According to the most recently available data, 54 per cent of children living in poverty in Alberta had a parent or parents who worked fulltime for a full year. One way to reward work is to raise and restore the indexing of the minimum wage.
In June 2006, Premier Ed Stelmach took the positive step of indexing the minimum wage to the average earnings of Albertans, only to freeze it two years later.
The announcement June 1 of a reinstatement of predictable annual increases to minimum wage is therefore welcome.
To further reward work, the next premier should enhance the existing earned income tax credit (which provides a refundable tax credit to supplement the employment earnings of low-income workers) by broadening eligibility to not only include families with children but also singles and childless couples.
For those Albertans not able to work, the next premier needs to index major income support programs to levels at least matching the cost of living. Indexing means low-income Albertans won't slip into poverty due to rising living costs. Income support programs include Alberta Works (social assistance), Assured Income for the Severely Handicapped (AISH) and Alberta Seniors Benefit programs.
The government also needs to stop penalizing people on income support who work to supplement their income.
For example, a single Albertan can earn only $115 per month and a single parent $230 per month before being subject to a 75-per-cent clawback in their Alberta Works benefits. A worthwhile first step would be to increase the Alberta Works earnings exemption to $400 per month and the clawback to 50 per cent. These are the levels currently in place for AISH recipients.
Alberta's next premier needs to reduce reliance on importing temporary foreign workers to address labour shortages. Instead, two things need to happen.
The first is to focus on better utilizing the skills of groups currently under-represented in the paid labour force. This includes aboriginal Albertans, people with disabilities, newcomers with foreign credentials and immigrants who are already here.
The second is to recognize that most temporary workers, especially those in low-and semi-skilled jobs, want to stay. Requiring them to leave would be bad for the economy.
There were 58,000 temporary foreign workers in Alberta as of Dec. 1. The number of temporary foreign workers in Alberta is roughly equal to the population of St. Albert. The Alberta Chamber of Commerce recently added its voice to those calling for temporary foreign workers to be given the choice of becoming permanent Alberta residents.
Alberta's next premier inherits an improving economy and likely a return to surplus budgets, allowing room for strategic social investments to be made.
There would be no better investment than a concerted attack on poverty in this province; an investment that would pay dividends by reducing costs in such areas as health, child protection and corrections.
John Kolkman is the search co-ordinator for the Edmonton Social Planning Council, a non-profit research organization that focuses on finding solutions to poverty and low-income challenges. His essay is part of a series, Becoming Alberta's Next Premier - Policy Ideas for Leadership Candidates. Other essays in the series can be found at the Institute of Public Economics, Western Centre for Economic Research or Canada West Foundation.
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