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National
Anti-Poverty Organization (NAPO)
on the Federal Budget 2004
Obsession
with Debt
Precludes Action on Poverty
By Dennis Howlett, Executive Director, National Anti-Poverty
Organization
March 24, 2004
First it was an
obsession with the deficit. Now it’s the debt. Prime Minister
Martin doesn’t seem to be satisfied with eliminating the deficit
and having one of the lowest percentages of government debt in relation
to the size of its economy of any industrialized country. He still
seems hell bent on paying down the debt as his first priority. In
its Budget 2004, his government set aside $4 billion for debt repayment.
And chances are, because of the low-balling of its past surpluses
and revenue projections, it will likely end up putting even more towards
paying down the debt. It even set a target of lowering its federal
debt-to-GDP ratio to 25 per cent within 10 years. This despite any
evidence that this will do our economy any good.
It is a bitter
pill indeed for Canada’s poor, who as a result, get nothing for
social housing, child poverty, Employment Insurance reform or other
social needs. The budget did offer something for people with disabilities,
many of whom are poor. And there was some assistance for children
from low-income families to attend university or college, but nothing
that would cap or lower rising tuition fees, which is the main barrier
to post-secondary education for poor students. There was certainly
not enough for the poor to hide the bitter taste of neglect or reverse
the trend towards greater inequality.
As the Finance
Minister in Chretien’s government who brought down the drastic
budget of 1995, Paul Martin bears a large share of the responsibility
for the unravelling of Canada’s social programs that his father
helped to put in place. The poor were forced to sacrifice disproportionately
in the battle to slay the deficit. But the poor have waited a long
time – “Canada will record its seventh consecutive balanced
budget” Mr. Goodale bragged in his budget speech – for the
government to begin addressing the crisis of hunger, poverty and homelessness
that its fiscal policies have created.
Martin’s
Finance Minister, Mr. Goodale, stated his first objective was, “to
demonstrate unequivocally the principles of financial responsibility
and integrity”. But it is not very responsible to be “paying
down the mortgage” if this means you don’t have enough money
left to cloth and feed your children.
As a society we
pay a high price for poverty, not just in the additional costs poverty
generates for our health care and prison system but also in the opportunities
denied poor people, especially children, youth, women, immigrants
and aboriginal people to participate fully in making their contribution
to society.
Poverty creates
a huge additional burden on the health system. According to a recent
Toronto study, hospital admissions and associated costs were almost
50 percent higher from poor neighbourhoods than from rich ones. Professor
Dennis Raphael of York University has estimated that since 23.7% of
premature deaths from cardiovascular disease can be attributed to
income differences, the additional costs to the health care system
in Canada for cardiovascular disease alone is about $4 billion a year.
A 2002 National
Council on Welfare Report on the Cost of Poverty identifies the cost
of incarceration of low income offenders as a major cost to society.
It is not that poor people are more likely to commit crimes. But those
who are arrested, detained without bail, jailed and given the harshest
sentences are people with low income. Canada has a relatively low
rate of crime, especially violent crime, compared with other industrialized
countries, but we have one of highest rates of imprisonment, especially
of young people. Keeping so many people in jail costs the federal
government over $1.3 billion annually.
The Report of
the Royal Commission on Aboriginal Peoples estimated the costs of
inequality and social exclusion of aboriginal people in Canada in
1996 was $7.5 billion. Of this $5.8 billion was estimated as the cost
of foregone production because Aboriginal people are not able to fully
participate to their potential in the economy and $1.7 billion for
extra expenditures on remedial programs to cope with social problems.
Poverty creates
huge barriers for children in their ability to get a good education
and good jobs. Poverty also condemns children to poor nutrition and
increased stress, which causes life-long health problems and shortens
their life. While difficult to quantify in dollar terms, the costs
of child poverty are perhaps the dearest.
We can stop wasting
precious human resources and cut our social and economic costs by
eliminating poverty. This is what needs to be the top priority for
government, not reducing the debt.
If Mr. Martin
wants to be remembered for something other than the destroyer of Canada’s
social programs he needs to get busy right away to engage Canadians
in a discussion of how we can work towards eliminating poverty and
building a healthier and more productive economy. He could strike
a parliamentary committee to go across Canada seeking input from Canadians,
much the way Mr. Romanow successfully did for re-visioning our health
care system. Then he needs to sit down with the provinces and negotiate
the terms for a Social Transfer so that together they can begin building
the social infrastructure we need for a healthy economy and a healthy
society.
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Dennis Howlett,
Executive Director/directeur exécutif
National Anti-Poverty Organization / l'Organisation nationale anti-pauvreté
2212 Gladwin Cres., Unit C7, Ottawa ON K1B 5N1 Canada
tél 613.789.0096; toll free/sans frais 1.800.810.1076; fax
613.789.0141
e-mail dhowlett@napo-onap.ca
website www.napo-onap.ca
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