Stephen Jones, 56, is familiar with all the belt-tightening choices many Canadians have had to make at the grocery store amid rampant inflation: swapping fresh vegetables for the frozen kind, giving up on baked bread and buying exclusively on sale.
Lately, though, squaring the budget for Mr. Jones has meant going hungry.
“Sometimes by the end of the month, before we’re getting to the due date for the money, I’m down to maybe just a very small meal once a day,” he said. “I am almost on the verge of having to skip meals altogether in a day.”
Mr. Jones, who gave up a career in finance in his early 40s because of debilitating anxiety and depression, has been living on less than $1,200 a month for 15 years. He is among nearly two million Canadians who receive provincial or territorial social assistance benefits, which often provide incomes far below poverty levels and aren’t indexed to inflation in most jurisdictions.
While provincial governments across the country have been scrambling to implement quick affordability fixes – from one-off cash infusions to households to freezes on gasoline taxes – so far they’ve done little to increase basic income assistance payments, advocates say. The result is that some of Canada’s poorest are sinking further into poverty, they warn.
Canada’s annual inflation rose at 6.8 per cent in April, a 31-year high. Grocery prices were up nearly 10 per cent compared to the same month in 2021, marking the largest annual increase since 1981.
In Toronto, the Daily Bread Food Bank, which runs more than 200 food programs in the city, had around 160,000 visits in March, a 134-per-cent increase compared to the same period before the pandemic and the highest number recorded in a single month. During the same month, the organization also recorded nearly 5,700 registrations from new clients, which it said was a 647-per-cent increase compared to the last wave of COVID-19. In a recent report, Daily Bread estimated that 60 of those who access its services rely on government benefits as their primary source of income.
For food-bank patrons who have debt, the financial squeeze is coming from both skyrocketing prices and rising interest rates, leaving very little disposable income for food, said Neil Hetherington, chief executive officer at Daily Bread.
“People have gotten to the end of their savings, they’re going into debt,” he said. “And so they’re going to be turning to food banks even more.”
The Bank of Canada has raised its trendsetting interest rate by three quarters of a percentage point so far this year, with economists expecting several more hikes in coming months, in an effort to combat inflation.
Mr. Jones, who has never relied on food banks, said he soon may have to do so. His monthly income consists of $118.38 he receives through the Ontario Disability Support Program and a $1,050.62 cheque from the Canada Pension Plan Disability plan, which provides income support to Canadians with disabilities who have been CPP contributors.
While the CPPD amount is recalculated at the start of every year based on the inflation rate, the ODSP payment shrinks for every increase in the federal income support, leaving Mr. Jones’s monthly income at $1,169, the province’s income support cap for individuals with disabilities.
Mr. Jones rents a basement apartment from friends for $800 a month, a rate he estimates is about a third of the current rent for a similar unit. But still that leaves only $369 to pay for everything else.
For a man of Mr. Jones’s age, Canada’s Food Price Report, an annual gauge of food-price trends, estimated the annual cost of food would amount to $306 a month this year, based on a food-inflation forecast of between 5 and 7 per cent.
Ontario hasn’t revised ODSP rates since the fall of 2018.
As the province heads for an election on June 2, the NDP and the Liberals have pledged to index ODSP and the province’s employment assistance program to inflation and vowed double-digit increases for both benefits. The Greens have promised to double rates and index them to inflation. The Progressive Conservatives would boost ODSP by 5 per cent with rates also climbing with inflation.
Other provinces have announced measures such as one-off payments to social assistance recipients, increased refundable tax credits for low-income residents or more funding for food banks.
To date, though, only Quebec, New Brunswick and Yukon have pegged basic social assistance benefits to inflation.
As inflation pushes past 30-year highs, the dearth of provincial income support indexed to living costs is leaving two groups in particularly dire financial straits, said Elizabeth Mulholland, CEO of Prosper Canada: childless, working-age single Canadians who are on welfare or disability benefits.
Canada has a strong record of reducing senior and, more recently, child poverty, thanks, in large part, to federal programs such as Old Age Security and the Guaranteed Income Supplement, CPP and federal benefits for families with children, Ms. Mulholland said. But the country lags other wealthy countries when it comes to providing a safety net for those living with disabilities or others in financial need who can’t count other income supports such as Employment Insurance.
For single Canadians considered employable and those with disabilities, annual income from basic social assistance benefits and other welfare supports fell far short of the poverty line in 2020, according to data compiled by Maytree, a Toronto-based non-profit.
In Ontario, where social assistance rates are at 30-year lows, welfare recipients who don’t have access to subsidized housing are increasingly unable to cope with any rent increases, according to low-income expert John Stapleton. Around 30 per cent of Ontarians who rent at market rates receive social assistance, Mr. Stapleton estimates.
But before low-income individuals stop paying rent they’re more likely to start skipping meals or rely on food banks, Mr. Stapleton said.
Mr. Jones, for his part, has been trying to make peace with knowing he’ll soon need to rely on charitable food programs for at least part of his groceries.
“I know that these places are very accommodating and non-judgmental, but there’s an element of shame in doing that,” he said.
“But at some point, yes, I am definitely going to have to go to a food bank.”
Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.