From TransAlta CEO Stephen Snyder’s office in a gentrifying downtown Calgary neighbourhood, you can look out and see the trendy Hotel Arts and Saint Germain restaurant – and, kitty-corner, a cluster of under-resourced and overflowing emergency shelters and drop-in programs.
Boomtown Calgary, which for years led Canadian cities in economic growth, also had the dubious distinction of having the country’s fastest-growing homeless population – a 30-per-cent increase in two years.
Homelessness costs taxpayers money – in both foregone wealth and social service spending. As evidence of the social and financial costs of inequality mounts, a growing body of research indicates paying to get people out of poverty can be an economic boon.
Calgary’s business community crunched the numbers: It costs four times more to pay for a year’s worth of emergency shelter, emergency-room medical care and law-enforcement for one homeless person than it costs to fund that person’s supportive housing for a year.
More recent figures have backed them up when it comes to the costs of poverty: A study earlier this year from Toronto’s St. Michael’s Hospital found homeless patients cost hospitals an average of $2,559 more than their housed counterparts.
At the same time, research into projects that guaranteed people a minimum annual income indicated savings in everything from social services and health care to law enforcement.
Some see a solution in a 40-year-old experiment: In the 1970s, Manitoba wanted to see what would happen if it guaranteed poor people in a few communities a set annual income.
The results are striking, said University of Manitoba professor Evelyn Forget, who’s now studying the program’s effects.
The philosophy behind this is simple: People are more likely to stay in school, out of emergency rooms and out of jail; they contribute to the economy through their purchases; they’re more likely to move eventually above the poverty line and pay taxes.
For years, Senator Segal has been campaigning for the country to implement something similar – replacing welfare programs by giving a top-up to bring low-income families above the poverty line.
The issue came to the fore in last month’s election campaign, kind of: The parties squared off on a guaranteed income program for low-income seniors.
The irony is that Canada already scores high compared to other OECD countries when it comes to helping the elderly. Where it falls short is where it matters: The working-age poor – the ones who should be contributing to the economy.
“With respect to working-age poverty, our numbers are really bad,” Mr. Segal said. “And that’s where we need to do more.”
“I don’t think we should underestimate the uneven effect of this recession,” said Anne Golden, CEO of the Conference Board of Canada. “The gap is growing. If the gap gets too big, that affects the quality of life for all of us.”
By the numbers
$134,000
Estimated amount for emergency shelter, emergency hospital care, law enforcement and other social services for one homeless person in Calgary, for one year
$34,000
Estimated cost to proide supportive housing for one person in Calgary, for one year
$12,555
Average cost of hospital stay for non-homeless patient at St. Michael's Hospital in Toronto
$15,114
Average cost of hospital stay for homeless patient at St. Michael's Hospital in Toronto
