Of the 24 cities, Vancouver has the highest percent of population with low income; the highest percent of working poor families; and the largest and fastest growing income gap between rich and poor. Welfare income was also very low in Vancouver, and Vancouver had the second highest number of households which paid more than 30% of their income for rent and/or lived in inadequate housing. Vancouver was also worst for “community affordability.” That means that the combination of low income plus high cost of living makes the poorest fifth of Vancouver residents worse off than those in other cities.

This conclusion is based on a very simple, yet effective measure of housing affordability: the ratio of median housing prices to the median household income in each municipality (housing market). This price-to-income ratio measures how many years the median family (the one in the middle of the income distribution, where half of all families earn more and half earn less) would need to work to earn as much as the median house costs. Typically, a housing market is considered affordable if 3 (or fewer) years of household income is sufficient to purchase a home in the area.

In Vancouver, however, the median housing price – $540,900 – is equivalent to 9 years and 4 months of the median household income of $58,200 (both are measured in the third quarter of 2009). Wow, just wow.

The rest of BC’s urban areas aren’t doing much better: 4 of the 5 least affordable housing markets in Canada were in BC. In order of lowest affordability, these are Vancouver, Victoria, Abbotsford and Kelowna. The next least affordable housing in Canada is in Toronto.

If you’re curious, the 5 affordable urban housing markets in Canada are Thunder Bay, Windsor, Moncton, Saguenay and Saint John, NB.

What can we do about the rising unaffordability of housing in BC?

First off, we need our policy-makers to recognize that housing affordability is a serious problem and begin to monitor it regularly so they can measure their progress in addressing it (targets and timelines, anyone?). Here’s where I agree with the assessment of the folks at the FIPP that in Canada

housing affordability has received little or no political attention, even in the bubble markets where booms escalated housing prices to unprecedented heights.

It’s time for this to change.

What kind of policy reforms should we be looking at? The folks at the Frontier Institute for Public Policy recommend a market approach of relaxing zoning regulations and getting rid of agricultural land reserves, which they argue will reduce the price of land and thus the price of housing. Increase supply to lower prices – a standard textbook economics solution, but in this case it’s not going to work.

No matter how far you take it, eventually there are hard limits to low-density sprawl. We’ve got only so much land to fill with single family homes before we run out. Paving over agricultural land may postpone the problem for a few more years, but it’s not a long term solution. Moreover, as we prepare to face climate change and peak oil, encouraging urban sprawl may well do more harm than good. And if our world is about to get a lot smaller, paving over agricultural land would soon prove to be short-sighted.

It seems to me that we’ve left the invisible hand work its magic in the housing market long enough by now to know what it is good and bad at. It does an excellent job of providing luxurious condos with ocean views to the highest bidder (and we don’t lack millionaires in BC), but it fails miserably at providing affordable housing to the hundreds of working families. And I’m not just talking about the poor or near poor here – whose situation is dire – but about families with two earners with decent middle class jobs who are finding it more and more difficult to afford a home in the city. It’s time for governments at all levels to intervene in the market and ensure that a share of the new homes build are priced so that they are affordable for middle income families.

And since affordability is not just about housing prices, but about household incomes as well, I’d like to see some action on the income front. A couple of decades of making our labour market more “flexible” have resulted in stagnating earnings at the middle, and falling real (inflation-adjusted) earnings for families in the lower end of the income ladder. We need to address the rising income inequality and increase the economic security of the poor and modest income households. This can be done both through strengthening labour law and through re-distribution via the tax system.

Using the pine beetle wood from our forests for rebuilding Haiti seems like an idea worth considering. What it would take would be enormous amounts of government money to make this happen, but if the Premiere truly wants to “re-establish and revitalize our forest industry” it makes sense.

Come to think of it, I can’t remember hearing anything at all about the BC government’s contribution to the Haiti relief effort. BC municipalities have signaled their intention to give support, and Harper is all over the news with his efforts. It would seem that Campbell needs some encouragement in this direction. I’m sure the forestry sector would be on side, and perhaps even the federal government could be.

For over 40 years, Statistics Canada has produced a statistic called Low Income Cut-Offs (LICOs), and for almost as many years, that statistic has been improperly cited as a measure of poverty in Canada. This, despite the fact that Statistics Canada has continually emphasized that it is inappropriate to equate LICOs with poverty lines.

This type of statement has bugged me for years. How can a statistical agency develop a measure of poverty, call it “low income”, and then have the audacity to point the finger at anyone who dares call it a poverty line. The logical retort is to ask them why they do not then develop a “real” poverty line. Statscan’s position is something like, you cannot talk about the numbers of people who are poor because we refuse to measure them.

But the piece gets better. The author reviews a simplified methodology of how the LICOs are calculated and how that can be influenced by how well-off people are at different points in time. That is, overall, people today spend a lot less of their income on the basics, and the LICOs are just an arbitrary cut-off relative to that amount. This is an important point, although other attempts to measure poverty don’t really change the percentages that much.

The punchline goes like this:

Based on LICOs, British Columbia had the highest incidence of low income in the country in 2007, but these LICOs are based on national expenditure figures. … To see how this can be problematic, one need look no further than the difference in the price of housing by province. British Columbia has by far the highest housing prices, on average, in the country. In 2008, the average house price in BC was almost 50% higher than the Canadian average. The problem is exacerbated even further when urban areas are compared. … While the difference in rents are not quite as dramatic, they are still significantly higher in Vancouver compared to most other cities with greater than 500,000 population across the country. Given that the cost of shelter comprises by far the largest portion of spending on food, shelter and clothing, this renders LICOs a dubious means of regional comparison, let alone as a measure of poverty.

I’m not sure I agree with that last clause, since the costs of food and clothing are not much different across the country. If housing is what matters, my takeaway from that discussion is that BC’s poverty problem must be even worse because of our high costs of housing. The author may really just be making a methodological point that provincial numbers should be based on provincial not national data.

This precipitates a general question about “what is poverty?” that inevitably leads to absolute measures based on minimum consumption of necessities. The author makes a pitch for the Market-Basket Measure (developed outside of Statscan by the federal department of Human Resources Development) although this one too holds up the finding that BC has the highest poverty rate in the country.

The MBM is indeed a useful measure, but it would be a loss not to consider relative position in society as an aspect of poverty. In fact, the grandfather of economics, Adam Smith, clearly argues for a relative definition of poverty: “By necessaries I understand not only the commodities which are indispensably necessary for the support of life, but what ever the customs of the country renders it indecent for creditable people, even the lowest order, to be without.”

Adam Smith, it should be noted, was not a right-wing ideologue. He would not have worn the Fraser Institute’s “Adam Smith tie”, which is sort of a burkha for free market fundamentalists. The Fraser, it should be noted, is in the shadows of this discussion, having promoted a “thin gruel” absolute measure of poverty for many years. The development of the MBM was a response to them, and after all of that effort, poverty based on the MBM is not much different than based on the much-maligned LICO.

It’s hard for me to see friends struggle financially, so I’ve tried to encourage Emily to get a better job. Though she doesn’t have a degree, Emily is bright and a hard worker — she should be able to do better.

But Emily doesn’t want to get a better paying job. There is no point, she tells me, because she’s close to the cut off point of many of the government subsidies she relies on and if she made even $1,000 more per year, she’d lose so much in government benefits that her net income would end up lower.

She’s calculated that she needs to earn thousands of dollars more per year to compensate for the value of the lost benefits and she figures that she can’t get such a job without finishing her degree. Which she can’t afford because her low income doesn’t allow her to save up for school. But she can’t get a higher-paying job to help finance her education because if her income went up she’d lose her childcare subsidy, her housing subsidy and will have to start making payments on her student loans.

It seems like the system is stacked against her.

And she’s not the only one. Many low-income people find themselves in a similar position as the majority of government benefits are targeted to the lowest income categories and phased out quickly as soon as the family’s income gets above the bare minimum. A recently released CCPA brief addresses the problem of benefit “stacking” and presents some possible solutions. You can read more about it here.

It’s a classic case of unintended consequences: policy-makers start with the laudable goal of helping the most needy first and they try to avoid spending scarce resources on those who are able to pay for themselves, but in targeting benefits narrowly to the lowest income families they make it very difficult for people like Emily to break out of the low-wage cycle of economic insecurity. For those who need to obtain further post-secondary education or training to be able to move up, the system becomes a catch-22 when BC’s high tuition fees are taken into account.

Benefit stacking is a real problem in BC and it needs to be considered carefully in the design of all new low-income tax credits and other benefits. I haven’t run the numbers, but my guess is that the new low-income credits the government just introduced in the last budget (the HST credit and the new premium assistance) are only compounding the problem.

The report estimates there are 400,000 British Columbians with some kind of addiction problem. The annual financial impact is $6 billion.

The BCMA says the burden falls mainly on addicts and their families, but it also falls on law enforcement, emergency wards and workplaces. The doctors call for changes in the way we look at addiction and they call “on the premier and the Minister of Health to formally recognize addiction as a chronic disease and increase resources for addiction treatment…”

Among the many issues addressed, the BCMA recommends the creation of “240 new flexible medically supported detoxification spaces across BC by 2012.” It quotes Health Authorities on the weakness of the current system. The Vancouver Coastal Health Authority makes the following comment:

While the intake system for detoxification facilities has been significantly streamlined in recent years, immediate access to withdrawal management services is still an unmet need among highly marginalized individuals, many of whom are homeless and have no safe place in which to wait for access to services. The result of missing or insufficient services is people not receiving treatment, inappropriately accessing emergency care, or staying for extended periods in more costly acute care.

The BCMA reports, “The number of people in BC with a severe gambling problem has increased since 2002 from 0.4% of the population to 0.9% in 2007.” Another 128,000 people have a moderate gambling problem.

On housing, the report says, “The current lack of appropriate housing programs for the range of addiction and mental health problems in BC undermines the effectiveness of and the ability to provide medical care and treatment.”

Responding to the report in the Sun, the Health Minister said while he agreed with the direction taken by the BCMA in these tough economic times the province is hoping to maximize the benefits of its health care dollars.

The Time is Now: A Poverty Reduction Plan for BC Slideshow

0. THE TIME IS NOW – Introduction from CCPA on Vimeo.

This is a narrated presentation about how BC could end street homelessness and reduce poverty by one third — within the mandate of the next provincial government (first chapter is shown above — view the full slideshow here). It includes interviews with people working on health, immigration and family well-being issues, and with Erna Calingasan, a parent struggling to make ends meet by working two jobs. Here is the interview with Erna:

THE TIME IS NOW – Erna Calingasan from CCPA on Vimeo.

Poverty Amid Plenty: A Slideshow About Welfare in BC

1. POVERTY AMID PLENTY – Introduction from CCPA on Vimeo.

Welfare is the program of last resort for people who find themselves without work, or who are unable to work because of a disability. It is supposed to protect people from homelessness, hunger and other hardships. BC was in the midst of an economic boom when this slideshow was created, but as we enter a recession in 2009, welfare is more vital than ever (first chapter shown above — watch the rest here). The slideshow addresses some myths about welfare and poverty — that welfare is easy to get; that life on welfare is an easy ride; that poverty is inevitable; and that solutions to poverty are too expensive.

The slideshow includes interviews and images of people who are living on welfare benefits, as well as advocates who work with welfare recipients and/or anti-poverty groups (these interviews can be watched separately). Here’s four of them:

POVERTY AMID PLENTY – Judy Graves from CCPA on Vimeo.

POVERTY AMID PLENTY – Richard Watson from CCPA on Vimeo.

POVERTY AMID PLENTY – Matthew Matthew from CCPA on Vimeo.

POVERTY AMID PLENTY – Susan Henry from CCPA on Vimeo.

Belo Horizonte, the fourth largest city in Brazil, has a population of 2.5 million people, slightly larger than the Lower Mainland. The city grappled with abject poverty and hunger in the early 1990s, when a new mayor decided to tackle these problems head-on by “creating a city agency, which included assembling a 20-member council of citizen, labor, business, and church representatives to advise in the design and implementation of a new food system” and establishing channels for citizens to problem-solve together in their own communities. The results were impressive.

There is much we can learn from Belo’s example. One of the key lessons is that often, all that is required to resolve pressing social problems is a change in our approach:

… it is easy to end hunger if we are willing to break free of limiting frames and to see with new eyes-if we trust our hard-wired fellow feeling and act, no longer as mere voters or protesters, for or against government, but as problem-solving partners with government accountable to us.

Participatory democracy is a powerful tool that is vastly underused in Canada. We should be doing more to ensure that our most precious resource, the ingenuity of our people, is directed towards solving the pressing problems of our times.

Belo Horizonte eliminated hunger. Vancouver should use a similar approach to eliminate homelessness.

But there is a new sheriff in oil town. And one bold new initiative is to end homelessness within ten years. As reported by the Wellesley Institute:

The Alberta government … released a dramatic plan to end homelessness in 10 years by committing $1.2 billion in capital investments and $2 billion in operating funding. The plan – based on the “housing first” approach (which provides immediate housing and then offers supports as required) – will lead to the creation of 11,000 new homes by 2012, according to the provincial government. Full details, including funding and implementation lines, will be released in next month’s provincial budget. Alberta’s plan – the first of its kind among the federal government and Canada’s provinces and territories – builds on top of a record of dramatic increases in affordable housing investments in recent years. Alberta cut provincial affordable housing investments in the early 1990s, as did many other provinces, but has dramatically increased investments in the past couple of years.

From fiscal 2007 to 2008 (the latest year for which numbers are available), Alberta’s housing investments jumped 140% to $4.57 billion – a record increase compared to other provinces. With today’s announcement, Alberta’s investments are scheduled to continue to increase. The critical details of the Alberta plan will be closely scrutinized by housing experts (more detailed analysis from the Wellesley Institute will follow), but the news has surprised more than a few housing advocates who don’t expect the Alberta government to be blazing the lead on critical social policy issues such as affordable housing. Compared to Ontario, for instance, Alberta – at about one-quarter the population – is making investments in affordable housing that are substantially higher than Ontario, which is leading to the creation of more affordable homes in that province. Much of the credit for today’s announcement goes to active and energetic housing groups in Calgary, Edmonton, Red Deer and many other municipalities which created local 10-year housing plans and then “uploaded” the requirements to meet those plans to the provincial level.

So now that Alberta is doing it, let’s hear the Liberal and NDP plans to do the same. So how about some time lines and targets? Here is what Minister Coleman had to say when we released our poverty reduction strategy (which includes homelessness but is more comprehensive in addressing poverty overall):

“We’re committed to ending it, but they say, ‘Give us a time frame.’ You know what, it’s just not possible because you don’t know how many people with mental health and addictions are coming at you at any given time, so what you do is you do the job based on the population you have.”

The response from the Leader of the Opposition was only somewhat better:

“I think those are ambitious targets. I don’t know if that’s realistic, but I think you have to start somewhere.”

Actually, we did have a good news day today, as the BC government announced $300 million in new housing investments that will create 569 units in Vancouver and 478 units elsewhere in the province. I’m waiting to see the fine print, and while acknowledging that this is a good start, it is a bit late in the game. About six years ago we flagged the problem of poverty and homelessness as something that needed to be tackled – if only because the Olympics are coming to town. Yet, only now, right before an election, are we starting to see some action, and relative to Alberta the numbers are still on the small side.

UPDATE (March 23): An email from Jenny Kwan, the NDP critic on this issue (and my MLA) informs me of a policy release two days before I made my blog post:

The NDP commitment is to end the crisis in homelessness in 5 years with annual progress reports to the legislature on how that target is being met. The primary mechanism will be investing in a new housing program with 2400 units in year one and 1200 annually to year 5 – there will be support services connected. This is a total of at least 7200 units. We will reallocate the existing $250 million B.C. Housing Endowment Fund to kickstart the expansion of social housing immediately.

The UN Special Rapporteur, Miloon Kothari, visited Canada for a few weeks in October 2007, as part of the UN’s efforts to ensure countries are living up to their international obligations to respect economic and social rights. Mr. Kothari’s mission focused on four areas: homelessness, women and their right to adequate housing, Aboriginal populations, and notably, the possible impact of the 2010 Olympic Games on the right to adequate housing in Vancouver.

The Special Rapporteur’s report is a very worthwhile read (and very concise). He emerged from his mission with very keen insights and an excellent historical understanding of Canada’s housing record. And he makes very astute observations about the jurisdictional buck-passing in Canada that blocks progress on housing.

He lauds Canada’s strong run of building new social housing between 1973 and 1993, but laments how little progress has been made since. Consequently, “While 40 per cent of all housing in the Netherlands is social housing, 22 per cent in the United Kingdom and Sweden, 14 per cent in Germany France and Ireland, and 10 per cent in Finland, Canada has only 5 per cent of its overall housing stock as social housing.” He was clearly particularly taken aback by Vancouver’s Downtown Eastside, and alarmed by the state of Aboriginal housing.

His recommendations include: that all levels of government recognize and legislate the right to adequate housing; that Canada commit to a comprehensive and coordinated national housing strategy with long-term and stable funding; re-embark on large scale building of social housing; and this:

Reducing homelessness and the number of people living in inadequate housing requires Canada to adopt a comprehensive and coordinated national poverty reduction strategy. Whilst three provinces have already taken important steps in this direction, the federal government should also be active in this area. This must include a review of the income available through social assistance and minimum wage in light of actual housing costs and a timeline for ensuring an adequate income to cover housing costs. (p. 26)

That recommendation clearly lends support to the campaign currently underway in BC, calling on provincial political parties to commit to a poverty reduction plan with legislated targets and timelines to reduce poverty and homelessness. For more on that (and to add your name to the call), see here.

Minister Rich Coleman was dismissive of many of Doyle’s findings. Nevertheless, in his response, the Minister did say some notable things I’ve not heard him say before. According to the Vancouver Sun, Coleman said that he would soon be introducing “performance targets to measure progress,” and he said his goal now is to end homelessness in five years (although it is unclear if he means street homelessness or all homelessness, an important distinction). There is no mention of legislating that goal, but I take this as some movement nonetheless. About a year ago, NDP MLA David Chudnovsky introduced a private member’s bill that would have legislated a five-year goal of eliminating homelessness, but at the time the government didn’t bite.

NDP critic Jenny Kwan, responding to last week’s Auditor’s report, said, “What we need are measurable targets, objectives and timelines.”

The CCPA is part of a growing chorus of organizations that have been calling for something very similar – a poverty reduction plan with legislated targets and timelines to reduce poverty and homelessness. So perhaps both parties are moving closer to making that commitment. Those wanting to add their voice to such a call should visit the website www.bcpovertyreduction.ca, and sign the Open Letter to BC’s political parties calling for clear targets and timelines.

Investments will be made in new and refurbished housing. We will expand supportive housing to combat homelessness and to shelter those with mental illness.

That new housing will be supported by a new integrated, personalized homelessness intervention strategy and a new community safety strategy.

Could it be that now, one year prior to hosting the Winter Olympics, the government had finally come up with a meaningful strategy to address homelessness?

I wasn’t the only one to notice. This promise made the headline of today’s article reporting on BC’s Throne Speech in the Globe: Homelessness takes centre stage in Throne Speech.

Imagine my disappointment, then, when I opened my paper copy of the 2009 Budget and Fiscal Update and found out that there was no new money to match the Throne Speech rhetoric. The only dollars attached to homelessness in particular are $30 million in 2008/09 “to acquire and renovate rental properties including 4 single room occupancy (SRO) hotels in Vancouver and 4 hotels/motels throughout British Columbia.” (p. 26).

That’s it? This amount would be woefully inadequate to meet current needs, let alone any potential increases in homelessness that may result from the economic crisis. Not to mention that these money were already announced late last year!

Instead, we are told that “Budget 2009 maintains previous funding commitments to implement new and expanded measures to help break the cycle of homelessness and support low income seniors and families.” Last I checked, previous funding commitments do not count as new investments.

To be fair, there is a line item called “Other spending” in Table 1.16 (Capital Spending) which, we are told, includes BC Housing Management Commission, Provincial Rental Housing Corporation and other service delivery agencies. It amounts to $125 million in 2008/09 and another $110 million over the next three years. Even if this all went to new social housing, and it likely does not, it would hardly solve the problem.

At the same time, the Budget doesn’t seem to include increased operating spending on housing or homelessness and the Ministry of Housing and Social Development is projected to shed 128 FTE positions in each of the next three years.

Without a funding commitment, the Throne Speech’s promise of tackling homelessness amounts to mere pre-election rhetoric. Don’t be fooled!

But can we really expect to “end poverty”? My generation grew up in the age of food banks and street people. Poverty is normalized for us, even if we’ve never experienced it ourselves. It’s not that I don’t believe my older friends and colleagues when they tell me food banks are a relatively recent invention, and that homeless people didn’t used to live in virtually every park and underpass — I just have a hard time imagining what a city/province/country with little or no poverty would actually look like. (At least not without taking my next vacation in Sweden.)

Even if I can’t quite imagine the end result, there is evidence that poverty can be substantially reduced, if not eliminated (for example, see this Unicef report on the wide variations in child poverty among OECD nations, and the UK’s recent improvements on its child poverty record).

Last week, the CCPA signed on to an open letter calling for a legistlated poverty reduction plan — one that would end street homelessness and reduce poverty by 30% within the mandate of the next provincial government. The open letter — signed by 200+ organizations — also called for a 75% reduction in poverty within a decade.

That might not be an end to poverty, but I’ll take it. And if you like the sounds of it, please sign your name to the call.

Representatives from just a few of the 200+ organizations that signed the open letter calling for a legislated BC poverty reduction plan. Photo: Goh Iromoto.

“Which is less expensive — to provide people with decent housing or to keep repairing burnt bridges?”