Canada: Living cutbacks

People waiting for a meal
in New Brunswick.
(Photo: OldMaison.)

Canada’s economic policy continues to take reduction of the debt and deficit as its primary end. The means to this end include cuts to social infrastructure spending, public sector employment and the health and welfare institutions that used to put Canada near the top of most international measures of well-being.

Under cover of deficit reduction, the Government of Canada continues to withdraw funding from the civil society organizations and research institutions that measure the effectiveness of those government policies and provide alternatives to them. The impacts of those cuts are beginning to become evident as income inequality grows.

On the international stage, Canada has championed austerity measures for countries facing economic crisis, Canadian foreign aid has been in decline while the Government's criticism of multi-lateral institutions for international cooperation increases.

If market conditions were ever to close the gap in Canada, this would have been the time. Social assistance rates have remained virtually unchanged across most of Canada. Most social assistance incomes in Canada remain well below the low income cut-off rate. The overall poverty rate in Canada is 9%, however, poverty rates continue to disproportionately affect women, Aboriginal peoples, and people with disabilities. For example, one in three Aboriginal and racialized people in Canada live in poverty. One in four people with disabilities, immigrants, and female single-parents in Canada live in poverty. Across all categories rates of poverty are higher for women than for men.

The sound and fury over Canada’s debt appears misplaced at best. Canada’s debt to GDP ratio remains relatively low compared to other OECD countries at 33.4%. While GDP growth has been significantly lower following the 2008 global financial crisis, and recovery remains slower than in past post-recession recovery periods, Canada continues to see real GDP growth at a higher rate than most OECD countries at 2.1%.  As the Government institutes broad public sector cuts, it continues to implement tax policies that have cost the Government $96.6 billion in revenue between 2008 and 2011.

The National Council of Welfare, now itself defunct as a result of federal funding cuts, has demonstrated that investing in programs aimed at eliminating or alleviating poverty “costs less than allowing it to persist.” They point out that “the money it would have taken to bring everyone just over the poverty line—was $12.3 billion [in 2007]. The total cost of poverty that year was double or more using the most cautious estimates.”

Set to “fuel the next wave of job creation” the government’s budget continues to depend on infrastructure projects to fill the tank. Infrastructure projects have been successful in creating jobs, but they do so in inequitable ways—stimulating job growth in male-dominated industries. An equal investment in industries such as health care, child care and education would yield a double benefit.  It would create more jobs in sectors in which women are likely to be employed and would decrease the burden of unpaid work for both men and women by strengthening Canada’s social infrastructure.

The current budget purports to fuel job creation in the private sector while cutting jobs in the public sector. The current job cuts being rolled out in the public sector are having a disproportionate impact on women. Women working in the public sector earn an average of 4.5% more than their peers in the private sector. Women seeking comparable work in the private sector, even if economic stimulus were to generate those jobs in the private sector, would see an estimated $2000 reduction in their annual income. Overall, this means that women seeking paid work will have fewer employment choices, earn less income where they are able to secure employment, and experience no relief from their burden of unpaid work.

At the same time the Government continues to make minimal investments in addressing a problem that is currently costing Canada’s economy nearly $7 billion dollars a year: violence against women and girls. Status of Women Canada, the government body tasked with addressing violence, spent just over $10 million in 2010-2011—a wholly inadequate response to a problem that directly affects an estimated one in six Canadians.

On the international stage, Canada’s rate of international assistance has been frozen over the past two years and is now set to decline for the next three years: ““between fiscal year 2011/12 and fiscal year 2014/15, the International Assistance Envelope for Canadian aid is set to decrease by 7.6%, from Cdn$5 billion in 2011 to Cdn$4.66 billion in 2014/15. Between 2011/2012 and 2015/16, when the time period to reach the MDGs will have elapsed, Canada will have reduced Canadian ODA by close to $1.2 billion.” According to the Canadian Centre for International Cooperation, these cuts will bring Canada’s level of ODA from “0.34% of Gross National Income (GNI) in 2010 to 0.25% of GNI by 2014/15,” well below the global target of .7%.

Canada has become increasingly critical of the United Nations, particularly its human rights monitoring mechanisms.  The visit of the Special Rapporteur on the Right to Food to Canada in May 2012 was described by the Minister of Citizenship and Immigration as “completely ridiculous.” The Special Rapporteur was told that he should not get involved in “political exercises in developed democracies like Canada.” This characterization of UN special mechanisms and monitoring bodies is not unique. Canada accused the Committee Against Torture of engaging in “bureaucratic mission creep” when it posed questions about violence against women and human trafficking. When the UN Special Rapporteur on the Rights of Indigenous Peoples expressed concern about conditions in the First Nations’ community of Attawapiskat, where the Red Cross had intervened to provide adequate shelter, food and water, the office of the Minister of Aboriginal Affairs and Northern Development characterized that statement as a “publicity stunt.”

Canada’s record on environmental sustainability earned it the ‘fossil of the year’ award from environmental organizations and criticism from other state governments during the Copenhagen Summit on Climate Change.

The economic crisis has pushed civil society to renew its engagement with economic policy debates. Governmental and non-governmental actors alike are grappling with the question of how to achieve their goals within a constrained fiscal environment. But the question of how best to stimulate economic growth and ensure economic stability is a question of means, not ends. Ultimately, the focus must remain on the society being built by that growth. Just as social justice organizations have had to grapple with the economic implications of their goals, those responsible for economic policy must face the human and environmental cost of their choices.

Source: Canada National Report, Social Watch Report 2013