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Living below the line

March 30, 2016

2-minute read

We all know that there is a line below which we cannot fall, a minimum income short of which we are unable to live decently. It's like sinking under the surface of water: it leads to drowning. Living with less than the required minimum is damaging for one's physical and mental health: it means borrowing from one's own life expectancy. We are also aware that many in Quebec are living below this line. In a study published last month, IRIS estimated how much money would be needed so that all get to lift their heads out of the water.

First, we needed to agree on said line. Lucky for us, the government of Quebec has a measurement to monitor situations of poverty according to whether or not basic needs are met! This measurement is called the Market Basket Measure and was developed by Human Resources and Skills Development Canada. Now calculated by Statistics Canada, it provides income thresholds needed to cover basic needs according to geographic location and household size.

We then took the 842,000 individuals living beneath this threshold in 2011 and calculated how money was needed to reach the threshold. We discovered that in 2002 the total amount of this human deficit was $2.5 billion — but in 2011, it rose to $3.6 billion. Spread across all those affected, the figure shows that the poorest individuals are, on average, $1,210 below the surface of the water.

Even though some people do not receive enough money to reach the minimum, the majority of the population exceeds the minimum. Therefore, we tried to calculate the amount that exceeds the threshold and how it has evolved across time. In 2002, this surplus stood at $81 billion and $93 billion in 2011, amounting to an average increase of $1,360 within households that have a surplus. Let's note however that between 50% and 55% of these surpluses are concentrated in the hands of the wealthiest 20%.

As is painstakingly clear when comparing only the amount above the line ($92.8 billion) for households over it to what is missing for the others to reach that line ($3.6 billion), solving these glaring shortages is completely within reach. In fact, we could even have fixed the human deficit entirely without affecting the standard of living of the rest of the population. Indeed, if all the wealthiest's increase in living standards had been directed to the poorest, it would have been possible to overcome the observed deficit. It would have been possible to cover everyone's basic needs with just this increase. We would even have had money left over to improve everybody's standard of living.

In short, we are aware that this deficit exists yet, until today, it remained invisible. We are thrilled to make this new tool available to measure the monetary aspect of the human deficit. We would now like to see the government monitor its evolution and implement solutions to reduce and to eventually eliminate it completely, an important step towards a poverty-free society. Successive governments have presented as a vital necessity the need to fix the public finance deficit, but ensuring that each and everyone can cover his or her basic needs seems much more urgent.

Simon Tremblay-Pepin is a researcher with IRIS, a Montreal-based progressive think tank. 

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