This year will be crucial in determining the true success of initiatives like the Social Policy Framework and the Children First Act. Depending on whether or not they include specific changes, these initiatives could end up just being statements of good intention or they could make Alberta a leader in eliminating child and family poverty. Here are some top takeaways out of From Words to Action. For the full report visit edmontonsocialplanning.ca.
One in 10 Alberta children lives in poverty. This trend is decreasing, but not at a quick enough rate. What’s most alarming is that the largest age demographic of children living in poverty are those under the age of six.
In 2011, Alberta hit a record high where 59.2 per cent of children in poverty were in a household where one or more persons had full-time employment.
Income inequality between the richest and poorest Alberta families is on the rise. Between 1990 and 2011, the yearly income of the poorest 10 per cent of Alberta families increased only marginally while the same period saw the yearly income of the richest 10 per cent of families more than double.
More than one in five employed Albertans work for less than $15 per hour, which has been estimated to be the wage required in Alberta to ensure you have the basic essentials. As of March 2013, 58 per cent of low-wage working Albertans were 25 or older and almost two-thirds of this group were women.
The Alberta Homeless Plan estimates that $330 million per year is needed to end homelessness in the next decade. Housing is by far the biggest cost for low and modest-income Albertans. Affordable rent or homeownership is a vital homelessness prevention strategy.
Secure jobs with decent pay and benefits are key to poverty elimination. Government policies need to be developed that improve employment conditions for low-income workers without extended benefits, pensions and job security. Alberta currently has the lowest minimum wage in Canada.
The number of immigrants and refugees settling in Alberta increased by 20 per cent in 2013, yet necessary funding for immigrant settlement and employment programs has remained stagnant.
In total, we need to invest an additional $1 billion each year to end child poverty. Fortunately, there are funding solutions that can be explored.
The first is to move Alberta back to a progressive tax system used by every other province. The current flat tax system means that people with average amounts of taxable income are paying more than in other provinces but people with larger amounts are paying less. If individual income of Albertans making over $150,000 per year was taxed at 14 per cent, the Province would bring in an additional $700 million per year.
Secondly, Alberta has the lowest corporate income tax rate in Canada at only 10 per cent. If Alberta was to increase this rate to a 12 per cent rate, we could bring in an additional $1 billion each year.
By making these changes to Alberta’s personal and corporate income taxes, the Provincial Government could bring in an additional $1.2 billion to $2 billion per year and still be the lowest tax jurisdiction in the country.