Ontario 2026 Poverty Report Card

After winning a third consecutive majority government in February 2025, the Progressive Conservative government is led by Doug Ford.

The Ontario government’s primary focus is addressing the economic impacts of the tariffs imposed by the U.S. government. Its actions to date include a $5 billion Strategic Response Fund to support the steel, aluminum, automotive, and manufacturing sectors. The 2025 Ontario budget projects a $14.6 billion deficit for 2025/26.  

The March 2026 Ontario budget contains ongoing needed investments in training and job development for students entering skilled trades and construction and relief measures for workers in the manufacturing and automotive sectors. However, there are few measures aimed at addressing affordability, the inadequacy of social assistance rates, and inequality in the province, or the chronic underfunding in areas related to these issues. In short, the 2026 budget is simply a status quo document that demonstrates no effort to address the factors that are driving increasing numbers of people, including working people, to food banks.  

The Provincial government has introduced some modest policies to address affordability issues — for example, lowering the provincial gas tax from 15% to 9%, introducing an electricity rebate, increasing the minimum wage, slightly increasing Ontario Disability Support Program (ODSP) rates, and indexing the Ontario Guaranteed Annual Income (GAINS) program for seniors to inflation.  

It has also made investments in housing in response to increasing accommodation costs and the significant need for new housing.  

Homes built before 2018 are protected by rent control — annual rent increases are limited to a percentage based on the Consumer Price Index for Ontario — but buildings built after 2018 are not, creating unequal tenant protections. Despite rent‑increase limits, loopholes have allowed rents to rise far faster than permitted: from 2014 to 2023, Ontario guidelines allowed cumulative increases of 16.5 per cent, yet average rents climbed 54.5 per cent, more than three times the legal rate.  

Housing is an ongoing crisis in Ontario. Approximately 85,000 people are unhoused and it’s estimated that nearly a quarter (23%) are youth and children. This represents an increase of almost 8% since 2024 and is projected that there will be 300,000 unhoused people by 2035. The recent deterioration of tenancy protections from this bill risks exacerbating the situation.  

Taken together, although some measures to address poverty and affordability have been implemented, they are modest and will not meaningfully impact the cost-of-living pressures people are facing, especially those who are living in poverty.  

Ontario has the fiscal capacity to increase investments in affordable housing and social assistance programs, but the provincial government has been resistant to measures that could reduce poverty, preferring instead to focus on job creation and skills development to address inequality.  

Affordability 

Restore full rent control coverage across Ontario’s housing stock. 
Ontario faces some of the highest housing costs in Canada, alongside a sharp and ongoing rise in homelessness that is projected to continue in the absence of policy intervention. The 2018 amendment to the Residential Tenancies Act, which exempted new builds from rent control, has created a growing segment of the rental market without basic rent stability protections. To support affordability and housing security, Ontario should reinstate rent control for all rental units, regardless of construction date, to ensure consistent protections and limit rent escalation across the entire market. 

Income Security 

Introduce a new poverty reduction strategy with clear targets. 
Ontario is in the process of launching a new Poverty Reduction Strategy, which is expected later this year. This strategy must come with clear, enforceable targets to reduce rising poverty rates across key groups, including children, single-parent families, equity-deserving populations, and working-age adults. The absence of a target in the previous strategy contributed to weak accountability and rising poverty. A renewed strategy should improve coordination across income, employment, and housing policy, with explicit attention to rapidly rising rents and core housing need. Poverty reduction targets should be grounded in the Market Basket Measure. 

Make an element of the Low Income Individuals and Families Tax (LIFT) Credit refundable. 
The LIFT Credit could reach more workers with low incomes. To make this happen, Ontario should make part of the LIFT Credit a refundable tax credit. For example, if $425 (that is, half of the maximum LIFT Credit) was made refundable for people with incomes over the maximum CWB threshold ($12,820 for single adults or $17,025 for families), their marginal effective tax rate would be lowered. 

This would mean that when their CWB payments begin to decrease, the LIFT Credit would be activated, so individuals would always benefit from taking on more work. 

Restore Ontario Works adequacy and increase earnings exemptions. 

Ontario Works (OW) rates have been frozen since 2018, resulting in a significant erosion of real income supports over time. If OW rates had been indexed to inflation, they would now be substantially higher and would reflect the increased costs of basic necessities. 

The current gap contributes to persistent income inadequacy and is a key driver of housing instability and homelessness. Ontario should both restore OW rates to their inflation-adjusted value and increase the monthly earnings exemption from $200 to $600 so that recipients can retain more earned income and overall income security improves. 

Labour Market Reform 

Improve work incentives for people who are part of the Ontario Disability Support Program (ODSP). 
Recent changes to the ODSP allow recipients to keep the first $1,000 of earned income per month, a significant improvement from the previous $200 threshold. However, earnings above $1,000 continue to be clawed back at a rate of 75%. Reducing this clawback to 50%, consistent with existing earnings exemption rules, would improve work incentives and support recipients who are able to participate in the labour market. 

Addressing Inequities 

Ensure the Student Nutrition Program (SNP) and the First Nations Student Nutrition Program (FNSNP) keep pace with federal investments in the Canada’s National School Food Program. 
In October 2025, the Government of Ontario announced an additional $5 million, for a total investment of $37.5 million, in the SNP and the FNSNP. While it was a welcome investment, school food advocates are concerned that Ontario is less than “all in” on meeting its commitment to working with the Federal Government to adequately fund the initiative.