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The Progressive Economics Forum

Missed Opportunity for PEI Poverty Strategy

The government of Prince Edward Island has introduced a Social Action Plan to Reduce Poverty, found online at PEI CSS.

This Action Plan follows community consultations, including face-to-face meetings and written submissions by community groups.

The government of PEI seems to take very seriously a Social Determinants of Health approach to poverty reduction, and so has exempted departments of health, education, and social services and seniors from broad government ‘belt-tightening’ designed to bring the provincial budget back to balance. In fact, these departments will see minimal new investments of $4 million over three years.

Given that Christine Saulnier and I estimated that poverty costs the PEI government just under $100 million per year in 2009 (The Cost of Poverty in PEI), any new investments in poverty elimination are welcome.

Also welcome is the recognition that spending needs to be focused on investments, such as affordable housing, weatherizing and repairs to existing housing, adult literacy, and early childhood education.

Most notably missing from Wednesday’s announcement is a set of clear goals, and a mechanism for evaluating progress towards those goals.

For example, the backgrounder on housing talks about the number of affordable housing units added since 2007, but does not indicate the level of current needs.

The PEI government’s 2011 report indicated that in 2006 there were 3, 640 tenant households in need of core housing (they spent more than 30% of their income on housing costs, their housing required significant repairs, or they were living in crowded quarters).

Since then, 340 affordable housing units have been added, meeting less than a tenth of the need. Even the increases in rent supplements and additional spending on affordable housing introduced in the Social Action plan will fall far short of the existing need for housing in PEI.

It is also unclear what the impact of HST will have on low income Islanders. In recognition of fixed incomes and the regressive nature of HST, home heating oil and children’s clothing are exempt, and low income Islanders will receive a rebate similar to the GST rebate. Still, it’s tough to know how much government spending on poverty reduction measures will be wiped out by the higher sales tax.

For a serious poverty reduction and elimination ‘Action Plan’, governments must honestly assess need, set clear goals, and transparently monitor progress towards those goals. If there is no method to evaluate progress and success, then there is also no method to enforce poverty reduction and elimination, and there is the risk that it becomes a purely cosmetic exercise.

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