BC has been a leader in poverty reduction since 2016, and overall has surpassed gains made at the national level.

This is true for both the province as a whole and among particular target groups, such as families with children. Despite this success, poverty rates in BC remain above the national average, in part because of the high cost of housing and consumer goods. BC needs to maintain its status as a leader in the fight against poverty, and it has many opportunities to do so in the coming year.

An Impossible Housing Market

The BC housing market is the most unaffordable in the country, and a lack of affordable housing has become a key characteristic of the province. Prices for renting and buying far exceed average incomes, which means more people are spending beyond their means on housing. For example, 40% of residents spend more than 30% of their monthly income on housing costs. With so much money going towards housing, over 70% of food bank clients in British Columbia are renters. This is a telling sign that the costs of housing, for renters in particular, are a big factor in the rising food insecurity rates in the province.

Despite the concerning costs of rent, only 5% of individuals in the province receive some kind of housing support, compared to 11% nationally. This indicates that housing supports may not be accessible enough for those who need them.

Cost of Living Beyond Housing

Many BC residents who live on low incomes are spending as much as 54% of their income on fixed costs like Internet, groceries, and transportation. Paired with the large numbers of residents paying more than 30% of their income on housing, there is little money left at the end of the month to feel financially secure.

For those who are struggling financially, social assistance may come as a last resort. Among BC residents receiving social assistance, 57% state that their rates are not high enough to keep up with the cost of living. Despite the province offering some of the highest social assistance rates in the country, at best, single adults are receiving amounts that are less than half of the poverty line. People living with a disability or who have children receive more support, but it is still far from the bare minimum needed.

Mental Health Fallout

BC is struggling deeply with mental health problems and addictions. Nearly half of the province’s residents feel worse off than they did last year, which may be increasing stress levels and negatively affecting mental health. A vast majority of individuals (65%) in the province state that addiction is an issue in their community that needs to be addressed. Half of the province believes that addiction is not getting the attention it needs and that people facing mental health or addictions issues need more and better support.

Sociodemographic Considerations

British Columbia is one of three provinces with a large enough sample size to report on racialized communities in our survey.

One in four respondents in a racialized community agreed that it was difficult to access needed social services, compared to one in five across the province.

Meanwhile, low wages are affecting almost 40% of those in racialized communities from making ends meet. This represents a nine percentage point increase from 30% across the province. Part of this issue may be exacerbated by the challenges that racialized individuals are facing with accessing stable employment – 38% compared to 25% across the province.

Beyond that, individuals in racialized communities in BC are more likely to spend 30% to 50% of their income on housing (+4 percentage points) and are more likely to feel financially worse off compared to the year before (+4 percentage points).

As BC’s premier, David Eby inherited the challenge of handling the ongoing poverty crisis, which as experts have highlighted, requires careful balancing of both short and long-term planning. In other words, tackling the immediate needs of poverty should not distract from the implementation of long-term solutions.

In 2018, the provincial government introduced a number of long-term strategies, including its poverty strategy, TogetherBC,  an affordable housing plan, wage increases, and an Expert Panel on Basic Income.

While the Expert Panel recommended against a basic income system, the extensive analysis and research work it undertook serves as a major blueprint for how to reduce poverty in BC and beyond. Since the panel issued its final report, the BC government has actioned some of its recommendations and continues to study others.

With the province experiencing higher than average childcare and housing costs, a series of actions were taken to reduce the resulting burden being faced by residents in BC. Between the federal government’s action on childcare and the provincial governments various other actions (mainly the B.C. Family Benefit), child poverty and poverty at large plummeted in the province.

Unlike many other provinces, BC has more than doubled its public investments in affordable housing since 2019, and it has recently created a $500 million Rental Protection Fund to help provide capital funding to acquire and preserve rental housing stock. In addition, developers are significantly increasing the proportion of purpose-built rental housing compared to other forms of housing, which is contributing to a much-needed increase in the availability of affordable rental housing.

Local experts believe that to address poverty effectively, the provincial government must:

• improve accessibility to, and availability of affordable housing, and
• address the provincial mental health and addictions crisis.

In addition, local experts are urging the government to focus on prioritizing the needs of key groups, including Indigenous peoples, sex workers, people experiencing homelessness, and migrant workers. This would allow the government to address the most pressing needs and significantly reduce poverty across the province.

While many programs and initiatives currently in place are helpful in addressing short-term policy gaps, they are not leading to meaningful progress toward enabling people to permanently move out of poverty. To make a real impact and establish long-term initiatives, experts suggest that politicians must be willing to step back and invest political capital in long-term initiatives that might not benefit them directly.

Unfortunately, the provincial 2023 budget fell short of expectations. While the province is taking steps to address poverty in BC, it could be doing more to address the underlying reasons behind the unaffordability crisis. The budget finally introduced the new income-tested renter’s tax credit, which was first mentioned in 2017. However, while households with an adjusted income of up to $60,000 will appreciate the $400 annual tax credit, it will do very little to stop skyrocketing rents and create sustainable affordable housing.

The budget did provide some hope for people receiving income and disability assistance, as the shelter rate was increased by $125 monthly. This was the first increase in the shelter rate since 2007. The budget also included $867 million for mental health, addictions, and treatment services, and as of July 1, 2023, the BC family benefit amounts, which are calculated based on adjusted family net income and the number of children under the age of 18 in the family, will be permanently increased.

Accountability

1. Produce a progress update on the 65 recommendations tabled in 2020 by the Expert Panel on Basic Income

As we near three years since the report’s release, it is time to step back and assess what has changed. An update on the status of recommendations, and a formal response to each one, would be helpful for assessing next steps for poverty reduction reform across the province. We recommend the provincial government produce a results report by the end of 2023.

2. Set the goal of bringing poverty to below the national rate in every category by 2026

As part of its commitment to improving affordability for all residents, the BC government should increase its poverty reduction targets and set a new, dual-track goal: 1) bring provincial poverty rates to below the national average by 2026, and 2) bring poverty rates to less than or equal to poverty rates in Alberta during that time frame of 2023–2026.

Affordable Housing

3. Enhance the Renter’s Tax Credit

As confirmed in Budget 2023, residents with low and moderate incomes will be able to access the newly created Renter’s Tax Credit as of 2024, which will provide up to $400 per year in direct cash support. While this is a welcome development in concert with stricter provincial rent control, the credit itself has been in development for several years, during which time housing cost pressures have continued to mount. The average cost of rented accommodation in Victoria, for example, increased 26% in the five years between March 2018 and March 2023, while the promised $400 credit has remained the same since it was first promised in 2017. With the expiry of the one-time top-ups to the Canada Housing Benefit, low- and moderate-income renters in BC will actually receive less support next year when the Renter’s Tax Credit launches than the combined cash assistance they were entitled to in 2022.

We therefore recommend the province increase the Renter’s Tax Credit to a maximum of $600 in 2024, with future increases tied to the rate of shelter cost inflation in BC.

4. Continue to invest in the construction of affordable rental housing and make the BC Rental Protection Fund permanent

To build on the affordable housing momentum, the province should:

• Make the Rental Construction Fund a permanent feature in future budgets so that non-profit housing providers can plan and develop projects strategically
• Work with the federal government to develop Indigenous-specific housing funding streams and an associated provincial strategy focused on the unique and culturally relevant affordable housing and homelessness programming needs of Indigenous communities throughout the province
• Coordinate with the federal government on the development of tax-related incentives to support the construction of more purpose-built rental accommodation with greater incentives for building housing that is more affordable and supportive.

Adequate and Livable Income Support

5. Index all provincial social benefits and credits and increase help for single people

In the last several years, the BC government has made significant investments to help families with the costs of raising a child, including the introduction of the enhanced BC Family Benefit. This has significantly contributed to reducing child poverty. However, there has been no similar action to address the distressingly high proportion of British Columbians—for example, nearly 1 in 3 adult women between the ages of 18 and 64—who are single and live in poverty. As a first step to fix this inequity, the province should raise income assistance rates for single people by at least 10% and then index all provincially administered benefits to inflation the following year. Combined with the recent increase in shelter allowances, these changes and the proposed increase in the Renter Tax Credit would provide nearly $1,500 in additional assistance, which is similar to the amount families with children receive under the BC Family Benefit.

Decent Benefits for Decent Work

6. Earmark future savings from federal investments in school nutrition and dental care to finance expanded worker benefits

The federal government is currently in the process of designing and implementing a national dental care program and a school food nutrition program. These programs are likely to result in longer-term savings to the provincial health and education systems as a result of improved social determinants of health. The province should use this opportunity to reinvest savings into expanding workplace benefits coverage and extended health coverage for low-income and gig workers. This will increase incentives to work and provide further opportunities to build on BC’s leadership in addressing precarious work.

7. Develop a provincial earnings supplement

Although BC recently increased the earnings exemption for people receiving income assistance, workers with low incomes still face relatively high rates of claw-back of benefits. To reduce this obvious barrier to good, stable employment, BC should examine the cost of introducing a provincial earnings supplement like Ontario’s Low-Income Individuals and Families (LIFT) credit and the federal Canada Workers Benefit (CWB). This could be incorporated as a key objective in the next iteration of the province’s poverty reduction strategy, with the goal of closing the poverty gap with the rest of Canada.