:
Welcome. Pursuant to Standing Order 108(2), we are continuing with our study on poverty reduction. We are moving forward in the area of housing and neighbourhoods, and we are very pleased to be hosted in the great city represented by MP .
I'm very pleased to see all of you here today. If we nod off, please forgive us. We got in fairly late last night, and we hope we can leave later today, as I understand we have a bit of a snowstorm coming.
We're going to get started with presentations from this group. We have quite a few of you here today, so we're going to try to keep the comments to about seven minutes if that's possible.
I'd love to welcome, from the Saint John Human Development Council, Randy Hatfield, executive director, and Greg Bishop, project manager, and from Living SJ, Donna Gates, executive director, and Penni Eisenhauer, community organizer. Oh, I'm sorry. Mr. Bishop is not here.
From the YMCA of Greater Saint John—go YMCA—we have Shilo Boucher, president and chief executive officer. We also have with us, as an individual, Erin Schryer, executive director, Elementary Literacy Incorporated. As well, from the United Way of Saint John, Kings and Charlotte, we have Wendy MacDermott, executive director.
Welcome, all of you.
We're going to get started right away with you, Mr. Hatfield. The next seven minutes are all yours.
:
Thank you, Mr. Chairman. I'd like to begin by acknowledging that the land on which we gather is the traditional unceded territory of the Wolastoqiyik and the Mi'kmaq people of New Brunswick.
My name is Randy Hatfield. I'm the executive director of the Saint John Human Development Council, the social planning council. I was to be joined this morning by Greg Bishop, but he is attending a medical appointment with his wife as their third child is imminent. On the heels of the rather dismal population figures that were released yesterday, we fully support his choice of venue this morning.
I've provided members with a power point deck that I'm not going to display but will be referring to. I would like to set the scene in the community of Saint John and describe the community that we work in through a poverty lens.
The first question we would want to ask ourselves is, “What is poverty?” In New Brunswick, we have an answer; we have a definition. In our Economic and Social Inclusion Act that establishes the New Brunswick Economic and Social Inclusion Corporation and oversees the provincial poverty reduction strategy, we find a definition of poverty that says it is “the condition of a person who lacks the resources, means, opportunities and power necessary to acquire and maintain economic self-sufficiency or to integrate into and participate in society”.
Well, how do you measure that? How do you measure a condition? It's a very lofty concept. It's a social inclusion notion that goes to participation and belonging, but when we talk about poverty, we're forced to use a surrogate measure. We're forced to use a proxy measure of income. When we look at poverty through a lens in Saint John, we look at something called the “low-income measure”.
I know that this committee and the government will be looking at measurement and what measure it's going to choose as it moves forward when discussing and implementing a poverty reduction strategy. I would commend the low-income measure as half of the median income, a widely accepted OECD measure that I think is capable of being trended over time and giving us powerful longitudinal tools to look at progress—or not—on the poverty reduction file.
Using the low-income measure and using taxfiler data for 2014, the most recent data available, we have in the province's eight cities levels of income poverty that range from a low of 8.5% in the city of Dieppe to a high of 24.5% in Campbellton, a city to the north. Similarly, when we look at the rates of child poverty, there is a low of 9.6% in the city of Dieppe, but a shamefully high rate in the city of Campbellton of 35.1%. The city of Campbellton has 10% of the population of the city of Saint John, and where we are today, in the city, we have a child poverty rate of 31.5%.
When we take account of poverty in this community and in this province, we also have to look at the working poor. StatsCan defines the working poor, a growing cohort of the population, as those between the ages of 18 and 64 who have earned income of more than $3,000 but still fall below the low-income measure. The city of Saint John has the highest percentage of working poor in the province at 8.1%.
As in any statistical analysis, you have to break things out. You have to go deep, or as deep as you can, when it comes to an analysis of numbers in poverty. When we look at the Saint John census metropolitan area, or the CMA, it's important to distinguish the central city of Saint John and the more affluent suburban neighbours that surround it. The CMA level of income poverty is 14.5%, which is a tie with the provincial rate. However, when we look at the central city of Saint John, we find an income poverty rate of 19.7% and a child poverty rate in the city of Saint John of 31%. The suburban municipalities that surround Saint John do better by almost any SES measure, whether it's income, degrees of home ownership, education attainment levels, or family composition. There are two worlds within the CMA, that in Saint John and that in the surrounding municipalities.
At the human development council, we encourage going even deeper in our analysis and understanding of poverty. We take a look at the city of Saint John and then disaggregate regions and numbers, and we are able to find that with our ward system of four wards, although they are of equal population, we have startlingly different metrics. Where we are located today as we sit in ward 3, we have a child poverty rate of almost 48% within this ward.
There are five priority neighbourhoods that have been identified in the city of Saint John. Three of the five are located in this ward 3, and two are in ward 2. As some of the measures that are in the slide deck would suggest to you, we have alarming rates of child poverty concentrated in our neighbourhoods, and in Saint John's case, concentrated in an electoral ward.
Another feature of this community you're visiting today is the presence of lone-parent families. There is a large cohort of that segment of the population. Lone-parent families account for one in three families in ward 3, one in four families in the city of Saint John, and one in 10 in a suburban town that surrounds Saint John.
We also have to consider the depth of poverty. It's one thing to say that there's a low-income measure. If you're $2 or $3 above or below, does your life not materially change? No. It's the depth of poverty that looks at the difference between the income that's received through work and entitlement and the low-income measure that's been established. We do have a depth of poverty here that requires a huge increase in income if we're going to put people above the low-income measure.
We also, in Saint John, suffer the consequences of income and wealth inequality, and we've seen the growing gap between the rich and poor. The senior economist at the Canadian Centre for Policy Alternatives noted in 2014 that of the 86 wealthiest Canadians, Canada's wealthy 80% represent only 0.002% of the population, but they're so flush that they could buy absolutely everything owned by every person in New Brunswick. They could buy all of New Brunswick's cars, all of the houses, all of the undeveloped lands, all of the stocks, bonds, pension funds, and RRSPs, all of the jewellery, all of the furniture—everything—and still have billions to spare.
But we at this table are filled with hope. We see an opportunity and a window that is open which suggests that circumstances are aligning themselves so that we can make a difference in poverty reduction. I would like to extend our thanks and appreciation to our local MP, Mr. Long, who has used a lot of his time and, one would say, his political oxygen on poverty reduction, and I think those at this table would agree.
We certainly feel the momentum here in this community as the result of some of his efforts. He was the sponsor of electronic petition number 291, which the Saint John Human Development Council was pleased to initiate, which is certified by the clerk of petitions, and which calls for Saint John to be designated as a demonstration site under the national poverty reduction strategy.
This morning, you will hear about the innovative programs and determined people who will make a compelling case for demonstration site investments. You'll learn of innovation, collective impact, and community collaboration, but I would be remiss if I did not remind the committee that we need strong national programs and that federal leadership is required. I know that the mandate letter to the talks about a national housing strategy, which is important.
You'll also hear about the importance of early childhood education and care.
We applaud the work that has been done over the years with regard to the levels of poverty among seniors. With the OAS as a universal measure, the GIS as an income-tested stream of income, and the CPP as related to employment, we now have seniors reasonably well accommodated with some tools.
With the child tax benefits for children, we have a wonderful measure that is now putting more money in the hands of low-income Canadians, not only as poverty reduction but, I would suggest, as poverty prevention. We are going to see the impact of the child benefit for years to come. I applaud the work of the government in that regard.
We still have to plug the hole of those with disabilities, those who are on income assistance, and the working poor. Along with enriching the working income tax benefit, we would urge you to look at basic income, but not at the expense of basic services. New Brunswick has yet to implement, for instance, an affordable prescription drug plan. In 2012, more than 70,000 families were identified as being uninsured. We would welcome this committee's consideration of a national pharmacare program. That would bring to this province a well-needed piece of infrastructure.
That concludes my remarks. I'm sure that was seven minutes.
I want to welcome you again to the city of Saint John. We wish you well in your inquiry on this important subject.
:
Good morning, and again, thank you for coming to Saint John.
My name is Donna Gates, and I am the executive director of Living SJ. I'm joined here today by Penni Eisenhauer, our community organizer and an incredible neighbourhood leader.
I'd also like to acknowledge and thank our MP, . He is personally championing the issue of poverty in Saint John, and we are very grateful, as Randy suggested.
Living SJ is Saint John's poverty reduction strategy and we have one goal: to end generational poverty. As I suspect you'll hear many times today, Saint John, sadly, is home to a deeper level of complexity: multi-generational poverty.
What is Living SJ? We are a network and a part of Vibrant Communities Canada. Our mission is owned by 36 local senior leaders, and I'd like to point out here that having senior decision-makers at the table has been key to our success. Our partners include all three levels of government, post-secondary institutions, low-income neighbourhoods, businesses, and non-profits. It was no small feat to get representatives from many organizations, who usually do not sit at the same table, to agree to four areas of focus. We used the principles of collective impact—and it is just that—to identify the following targets.
First is education and closing the education achievement gap: every child succeeds, from early learning to post-secondary. This includes improving literacy and high school completion outcomes.
On health, it's a neighbourhood-based model of care, with individuals at its centre.
For employment, it's about connecting residents to employment through education and training. The Learning Exchange, which you'll see in action later today, shows a path to transition from social assistance to employment. Your lunch is being prepared by one of their amazing social enterprises. This is a true Saint John success story and I look forward to you finding out more about it.
Neighbourhood revitalization with a goal of mixed-income attraction is our fourth pillar. Penni will speak to this a bit more, but a fundamental defining value that we have at our centre is the inclusion of the voice of lived experience. The Land Bank has been named as a priority of our Living SJ housing working group. Jody Kliffer will speak to this later this morning.
I want to share with you that we are currently helping colleagues in Halifax as they begin to prepare their process of collective impact to address poverty. This is all about sharing and learning from one another. Their community says this: “Nothing about us without us”. That speaks to the voice of lived experience always being at our table.
We've developed a common agenda, and it took some editing. We deliberately had to consider what was out, at this stage anyway, and what was in. Also critical to our success is shared measurement. Our partners are measuring their activities in the same way. For example, the health authority discovered that the cost for three individuals using the emergency department over a three-year period for non-emergency reasons was $100,000, so our team looked at how to reach people where they lived, and a wellness centre within one of our five priority neighbourhoods was established.
What do we need? We recognize that government cannot do this alone. We're asking you to use Saint John as a lab. We want to keep learning and experimenting to get it right. This involves sustainable and more bendable multi-year funding with community input and accountability built in. Let's put decision-making back in the hands of the community. We're doing it here, and it's working.
Thank you for coming to Saint John.
Now I'd like to turn it over to Penni.
I would like to welcome you all to Saint John.
[English]
We are not going to make a difference in poverty if people who have lived experience are not included in the process and in decision-making at every step of the way and at every level. Our lens is that privilege, money, and power exclude, and what we are really talking about is that we cannot make change and see a difference if those with lived experience are not engaged from the beginning. If we are not at the table, then we cannot help.
What I know from the work I do as a community organizer within one of the priority neighbourhoods is that when people are engaged it influences change in their lives. I've witnessed things changing within neighbourhoods because people can see what they can have an impact on. This, I believe, is true engagement in a meaningful way.
What we know from people with lived experiences is that there are two barriers within our system.
Number one is the time of the month for the child tax credit. The recommendation is that it be changed to the 15th of the month. This comes to you on behalf of those voices living this experience.
Second, for those who have gone through the criminal justice system, the changes since the Harper government have had a significant impact on those of us who have a criminal record. These barriers include: access to employment; access to post-secondary education; and even volunteering at your child's school. The recommendation would be to go back to the pardon process, which the Liberals supported prior to the Harper government, .
If you want tangible results and you want neighbourhoods revitalized, you need to allocate financial resources to the work of poverty reduction in Saint John. Through investing in neighbourhoods, engaging in meaningful ways, and building on innovative projects, programs, services, and best practice models that currently exist in Saint John, I believe this will elevate the level of our ability to implement what we know works, do pilot projects, showcase collective impact, measure outcomes, and have a social return on investment. Also, we will learn from each other, and that includes success and the ability to say that we need to make change, ultimately making a difference and improving people's lives with the hope of ending generational poverty.
This is the value of having someone with lived experience presenting here today.
My name is Penni Eisenhauer, and thank you for listening to me.
Merci.
:
On behalf of the YMCA of Greater Saint John, thank you to the members of the committee for this great opportunity. I'd like to welcome you to Saint John.
I have been working at the YMCA for 10 years now and have served as president and CEO since 2011. Before that, I worked in business, and I can say that it has been an eye-opener to see the level of poverty that exists here in our city. More importantly, I think, I need to express the level of support and willingness in our community to improve the situation that exists. It's fundamental. For more than a decade, community groups and business leaders have been working to reduce poverty.
As for what the YMCA does, we support 2,400 people a year in Saint John through the YMCA's Strong Kids program, which is our annual fundraising campaign focused on raising much-needed resources to give kids the opportunity to live healthier and happier lives today and in the future. Really, the goal today is to bring your attention to the importance of early learning and child care in breaking the cycle of multigenerational poverty.
As Randy mentioned, Saint John, New Brunswick has the highest rate of child poverty in the country. In the south end, where an evidence-based early learning centre already operates, 90% of the attendees are in second- and third-generational poverty. Further, New Brunswick has some of the highest adult illiteracy rates in the country.
To address these challenges, the YMCA of Greater Saint John currently operates an early learning centre, which began as a three-year community pilot project in 2009. What is different about our model of early learning centre is that it not only provides early child education to children, but also supports the family. We are already seeing positive impacts in our community.
By taking innovative neighbourhood-based approaches and centring services for children and parents within community hubs, we can have a greater, longer term impact that breaks the cycle of poverty. When services are spread out across multiple locations and parents face additional challenges such as literacy or disabilities and lack of transportation, navigating the system can be difficult.
Consider Krystal's story. She is a mother of three, one of whom has autism. Initially, Krystal visited the early learning centre at her social worker's insistence. Impressed by the staff, she has been at our centre ever since. According to Krystal, “...the best part is we no longer have to take a bunch of buses for all of the kids' appointments”. She said:
It felt like we were always running from place to place. A lot of times I just cancelled because I was too tired to go. Now our early interventionist, speech therapist, occupational therapist, physiotherapist and social workers all come and meet us at the centre.... I don't miss [my] appointments anymore.
Also, the children are doing wonderfully.
Our model of early learning is designed to help families like Krystal's in a way that reduces barriers for parents and gives children the support they need.
Almost 90% of our children receive some type of financial assistance in the early learning centre, and over 50% of the children are below the targets for developmental levels. To address this situation, we deliver a free kindergarten readiness program for those not in licensed care. We also offer nutrition classes tailored to children and parents working together to learn about healthy food. We also provide information to parents when they need help. We connect them with community organizations such as food banks, parenting classes, and case workers. We even help fill out forms in cases where literacy is a problem.
The Saint John Early Learning Centre has had many positive results over the last eight years of operation. Our capacity has expanded, with 7,000 family visits each year. Twenty partner organizations are engaged with the centre. The better school preparedness score went from 40% to 80%. We have increased kindergarten readiness programs in two other locations, and there are more programs provided. We have enhanced program offerings based on community needs and now offer 17 different programs.
We have achieved these results while working with limited resources. To meet the needs of the community, additional funding will be required. Currently our programs operate with support from the provincial government and the YMCA's Strong Kids program. Currently, we do not receive any federal funding for this program. In addition to leading national policy development, the federal government can provide much-needed funding so that many more families can access these poverty-reducing programs.
In the coming weeks, we will be submitting a proposal for federal funding for a pilot project called “Learning Together”, which will test the feasibility of a model for integrating child care, kindergarten, family support, and the delivery of social services in a school-based community hub. Our aims include: increasing the school readiness of children; increasing reading proficiency; and, increasing early learning access for all low-income families by providing full funding to all families that fall beneath the low-income measure. The project will expand on the work of the current centre, implementing a program and research model and creating two new centres in the priority neighbourhoods.
My colleague Dr. Erin Schryer will speak to the research component she will oversee as part of the Learning Together project.
The anticipated return on investment for this program is high. According to economist Robert Fairholm, high-quality child care in Canada will return $2 for every $1 invested, and societal long-term benefits exceed costs by more than two to one.
Also, a study led by Dr. Gina Browne at McMaster University showed that lone-parent families on social assistance who received comprehensive services, including quality child care, resulted in 25% of the families exiting social assistance, compared to 10% without those services. The study showed that offering comprehensive services to single mothers and their children pays for itself within one year. This is due to reduced health and social services, and a high level of exits from social assistance.
Innovative community-based approaches that support parents and children are needed to tackle multi-generational poverty. This will require support from the federal government. Public investment in initiatives such as the Learning Together project that we have proposed can have a transformative effect, building the economy, supporting families, and helping children get off to their best start.
Thank you for this opportunity. We greatly appreciate it. We look forward to continued stakeholder engagement throughout the development and implementation of the poverty reduction strategy.
:
Thank you, Mr. Chairman. I am very pleased to be here today and to welcome you and the entire committee to our beautiful home of Saint John, New Brunswick.
I received my doctorate in education from the University of New Brunswick in 2014. I continue an active research program there as an honorary research associate. I'm also the executive director of Elementary Literacy, or Littératie au primaire. We are a provincial non-profit organization advancing the importance of early reading success among New Brunswick children. We are currently serving over 200 elementary schools across New Brunswick, in both English and French, and over 1,200 students annually.
To begin today, I would like to start by highlighting four key principles that I would urge the committee to follow in developing this important strategy.
Number one is the use of evidence to inform your work. I have to say that I fear the term “evidence-based” has become a little sexy and has lost some of its meaning. I would urge us to remember its meaning. Take literacy as an example. Federally, funds earmarked for literacy have traditionally been earmarked toward adult literacy programs and organizations, even though I would argue that funding levels have never been as high as they need to be. The research evidence, however, clearly demonstrates that the prevention of reading difficulties is best followed by remediating difficulties early, when children are in school, such as we are doing at Elementary Literacy. Preventative early intervention approaches have been proven to be the most effective ways to increase literacy in a population. The evidence is clear, yet policy—or perhaps tradition—has not kept up.
Number two is the use of experimentation. Our experience at Elementary Literacy when we were established in 2009 was that national and international research was emerging that showed volunteer reading mentors could significantly support children's reading development, but we needed to experiment with that evidence here in New Brunswick, as every jurisdiction has unique characteristics.
In New Brunswick, we are Canada's only bilingual province, and we needed to create French and English programs. Roughly half of the population in New Brunswick lives in rural settings. We also have areas with extreme concentrations of child poverty, such as here in Saint John.
Through experimentation, local evidence is collected, refinements are made, and things are made to work.
My third point is something that we have worked really hard on here in Saint John and that Donna talked about: coordinating and leveraging existing infrastructure, resources, and knowledge.
Finally, my fourth point is around the need to be innovative. We need to use evidence in innovative ways to explore directions—in this case, for reducing poverty. Nobel laureate and economist James Heckman has concluded widely and repeatedly that early childhood development heavily influences the health, economic, and social outcomes of individuals and society at large. He has shown time and time again that there are great economic gains to be had by investing in early childhood development, particularly among low-income children and families.
This brings me to the specific project that I would like to bring here to Saint John as part of a national poverty strategy. Learning Together is an innovative, evidence-based prototype of early learning service delivery. Learning Together aims to establish three early learning demonstration sites in three priority areas of Saint John, all of which have high concentrations of child poverty. The three centres will work together as one fully integrated branch of a single strategy for programming, implementation, and research. One of these centres already exists, and I am very pleased to know that you are visiting the Saint John Early Learning Centre this afternoon. Two new centres are also being proposed.
These centres are in response to the evidence, which is very clear, that children are oriented toward success or failure at kindergarten entry. This is based on the experiences they've had in the early years before school. For children living in poverty, the odds of reaching kindergarten ready to learn and to benefit from the curriculum and their teacher are very low. In fact, the 2014 Canadian Institute for Health Information report concluded that while 26% of Canadian children demonstrated developmental problems or risk profiles at kindergarten entry, more than 40% of children living in low-income areas exhibit risk at kindergarten entry and less than 10% of children from high-income neighbourhoods exhibit any level of risk.
The link between income and school readiness in Canada is very strong, but it does not have to be. Early learning research has shown that children who attend high-quality early learning facilities exhibit greater rates of school readiness, language, and literacy success once in school, and ultimately greater rates of social mobility, enabling them to break the cycle of poverty for them and their families.
Learning Together would fill a significant gap in service for low-income children and families. Child care in Canada is still treated as a market commodity. Parents pay very dearly for child care. Families in poverty simply cannot afford to do this and thus often lack the access.
A significant piece of Learning Together is the research program that I would manage should our model be adopted, with the primary aim of integrating early learning research, practice, and policy to enhance the skills and school readiness of low-income children. Importantly, through this work, we will also address the knowledge and competencies both of educators and of parents. Parents are our children's first and most influential teachers. We cannot forget that.
I want to leave with you this. There is an opioid crisis happening in our country. It is devastating communities and families and killing Canadians. Dr. Maté, a retired palliative care doctor, recently penned an op-ed for CBC News entitled “Fixing fentanyl means treating trauma that creates addicts”. In his piece, he speaks to the influence of early childhood in shaping the brain, noting that “childhood adversity is at the core of the emotional patterns and psychological dynamics that drive addiction”. That Learning Together, through prevention, has the potential of impacting future addicts is not an exaggeration.
I thank you for your time and for considering this work. Excuse my trembling voice. Thank you.
Thank you for coming to Saint John, and welcome.
[English]
I serve two rural communities as well as Saint John. Our United Way has undergone pretty significant change over the last four years. We've gone from being a typical funder, basically a writer of cheques. That was good, and we did that really well, but when we looked back at our 60 years of history, we saw that social conditions really hadn't improved despite the fact we invested $50 million over that time. We decided that something really needed to change and said, “Let's start with ourselves.”
We decided instead to be a catalyst. We're still writing cheques—don't worry—but we're doing it very differently. We're doing it with a new sense of responsibility. We are much more focused on outcomes than on transactions, than the number of kids sitting at a desk. We're much more interested in whether those children graduate. We're much more interested in whether a woman does not return to an abusive situation for the rest of her children's lives, rather than whether we just saved her life one night. That's important, and we can't lose those things, but we will continue on this treadmill if we continue to invest in the same way.
We saw our role change and we believe the role of all funders needs to change. We need to leverage each other. We need to create new expectations in our community. We are driven by performance, as humans, as systems, and as organizations, and if we have greater expectations of our community organizations, they'll do it. They'll perform. We've seen it happen over and over again. If as funders we drive the measurement of transactions, that is what they have the capacity to do, and that is what they will do because we've asked them to.
As funders, we need to create a greater discipline and a responsibility. Without innovation and discipline by funders and service providers, children will continue to go hungry and the fragile will continue to suffer indignities. We have to look at breaking the cycle. We have to stop driving projects that are independent of each other. We do not have the luxury to continue as though we are all on our own as funding partners. We must be interdependent if we are going to make any of these substantive changes. We have to align our efforts and our resources. We can leverage each other. We can leverage our money. We can leverage our expertise.
What you have at this table are people who are very grounded in their respective organizations and the realities that we serve.
There are deeply imbedded cycles, particularly in Saint John but also in many other communities throughout the country. We can make a big difference if we stop making decisions in isolation of each other and being preoccupied with our own territory and our own mandate.
As funders, we also—and this is not popular—drive duplication. When our provincial government, our federal government, and our local United Way make decisions in isolation, and when we fund different organizations to do similar things and don't ask each other what we're doing, we are driving this insanity. The community cannot respond in any other way than we are demanding of them.
We also must have the courage to say no to the things that can't demonstrate that they work. That's so we can say yes to the stuff that does. You've heard multiple examples of projects that work but are vastly underfunded because we are trying to spread our resources too thin. We can make an impact, but not the way we've been going.
We also have to free up the human resources of the local organizations. They are chasing their tails in trying to meet our reporting requirements. We all ask for different timetables, different fiscal years, and different budget templates. This is insanity. They are spending so much of their precious resources on accounting, measuring, and reporting—and often measuring things that actually don't matter—to keep us satisfied. That is wrong.
We could easily free up 25% of that capacity. For those of you who have some business background, imagine that. Just like that: another 25%. Imagine a world where Erin's organization has to write only one report a year that goes to all funders. These things are completely within our control.
Both Randy and Donna spoke about what makes Saint John unique. We have deep generational poverty, we have single-parent families, and we also have a tremendous history of collaboration. There are certainly federal actions that can go a long way in redistributing wealth, but in a community that has created a subculture of poverty, much more than money is needed to resolve generations of no workforce attachment, untreated mental health issues, and, frankly, hopelessness. These issues can only be resolved locally.
Our community is one that has self-organized for over 15 years to tackle this complex issue. What we need from the federal government is a flexible and willing partner. We know that standardization and systematizing things is the way of big bureaucracy, but we desperately need to innovate. We need to experiment, just as Erin said.
We are the best game in town—in the country—when it comes to innovation and experimentation. We are committed to breaking the cycle of poverty. We want to go from being the city in Canada with the highest rate of poverty to being the one that figured out how to fix it. That's something to be proud of. That's something to tell our children about.
We'll do this by measuring whether our initiatives work and by directing our funds to what works, to rewarding innovation and risk-taking, balanced with bringing in the best practices from away. Again, we need the federal government as a partner in our local strategy. As has been mentioned, MP and his staff have been deeply engaged in the work of our community, but there are limits to what one MP can do.
Sorry, Wayne.
We don't fit neatly into any one provincial or federal department. Issues happen here in Saint John and, frankly, our failure or our success will be determined here in Saint John. We have demonstrated as a community the courage to make tough and sometimes unpopular decisions in order to achieve greater outcomes.
As a local funder, having a strategy in place provided my organization with the support we needed to say no so that we could say yes. We need to create a local innovation fund with flexibility and pooled resources, so that federal government resources, provincial government resources, community resources, and business community resources can be deployed in strategic ways with significant accountability. Again, we can do these things.
We know that big systems struggle to innovate. We know governments cannot risk public failure. A local fund is an arm's-length means of contributing to local innovation without assuming the risk of failure. As a community, we're willing to assume the risk, the collective impact. This would be ideal for ideas that do not fall within any one government department, jurisdiction, or mandate, so we invite you to become partners with us in some crazy new ways.
I'll leave you with one last thought. Living SJ was invited to go to Australia to talk to the Australians about how to engage business in philanthropy. As often happens, the conversation revolved around money, such as, how do we get those corporations to give the community money? Sure, that's important, and there is a cheque-writing function that is very important in this work, but there is so much more that the business community can bring to the work we do: the business discipline, the entrepreneurial spirit, the drive to metrics, and the focus on performance. Those are things that drive us in this community.
I again welcome you to consider a broader role for the business community in engaging and participating. Bell's Let's Talk program is a wonderful illustration of a company going further than just writing the cheque by creating a conversation that none of us locally can do.
Merci.
Thank you for coming.
:
How much time do we have?
Voices: Oh, oh!
Mr. Randy Hatfield: That's a great question, because New Brunswick would be considered a province in which 50% of the population is rural.
There is a tension between strong national support programs and the flexibility that could be engaged and enjoyed if you were to target resources. Coming from a smaller community, maybe you can appreciate that it's a question of scale, which is often very difficult. Saint John now has 68,000 people, and we experience all the social ills of any major metropolitan area. It's a question of how we can create and develop the capacity to deal with that. We have a needle exchange, a men's shelter, and a women's shelter. These are all fragile pieces of infrastructure that we're trying to sustain.
It seems to me that a principal barrier when you're talking about rural populations is transportation. I know there are many in this group who have worked to overcome that and to deal with it. It's a huge barrier and an impediment to participation, to belonging, to getting access to services.
Per capita funding allocations don't often serve us well. New Brunswick now, according to yesterday's census data, has 2.1% of the national population and 10 federal seats. It is a question of relevance, of access, of political power, and of what per capita funding allocations do. We need to have some flexibility at the local level. I think differential funding formulas are something that this community has advanced over the years, and I think there's a compelling case for doing that. A central city elementary school trying to fundraise and to develop the range of services that you would expect in a public school is far different in downtown Saint John than it would be if it were in one of the suburban municipalities or even one of the rural areas that surround it.
It's an excellent question. I don't have an easy answer. I think there's a combination of a strong national program.... I spoke about pharmacare, and I think there are 70,000 families in New Brunswick that are uninsured. I think it's going to have to be one of those combinations.
:
Well, if you want the answers, they're the people to talk to. They're the ones who've lived it.
I've lived the experience. I grew up in a middle-class home, but I suffered with mental illness and addiction. I have two degrees; however, I've lived a diverse lifestyle, which led me into pockets of poverty for certain periods of time. I do know what it's like to live in substandard housing. I do know what it's like to not have enough money to get the food you need. I know what it's like to navigate a system that really wants to keep people in poverty.
I understand the fact that people are uncomfortable when people talk about lived experience. It makes people uncomfortable. For instance, I can come here this morning. However, maybe for a mum or someone who has children to get to school, 8 a.m. may not work for them. I think you need to look at engagement in meaningful ways.
I work with a collective, a group of neighbourhood leaders. We're called the “Neighbourhood Action Group”. We've developed a meaningful way to engage individuals around honorariums. There should be a value placed on people's time, and I feel that people are more likely to be engaged when there are child care, transportation, and food, and their time is valued.
My recommendation is that we need to look at the tables that require lived experience, and we need to look at how to engage people meaningfully. For some people this is very intimidating, so you may need to go into places that already have people naturally congregating there and have a natural conversation instead of having them always around the table per se.
:
Thank you for your question.
[English]
At Elementary Literacy, we're doing two things.
There's the whole literacy file. We know that people with low literacy are more likely to be unemployed and to be engaged in the social system and the criminal justice system. There is a range of impacts that are costly to government and also to the person in terms of the opportunity cost loss. Even just generally, I would illustrate that as the literacy issue. In New Brunswick, over 50% of adult anglophones have low literacy. Over 60% of our francophones have low literacy.
Our low literacy levels are really holding our province back. There has been much conversation lately. We're often looking at literacy and the economy, and how the economy is being held back in New Brunswick because of our low literacy levels.
What we did with Elementary Literacy, as I mentioned, was to really go to the evidence to see how we could help. At the time in 2009, there was a private sector movement afoot to say that we really needed to get this under control. The private sector was saying that it was affecting their bottom line. They couldn't find workers, and the innovation and entrepreneurship that they wanted to see in the province just wasn't there, and a lot of that was coming back to our low literacy levels.
We went to the evidence. It showed that reading problems emerge early in children. That's really the time to remediate. What we're advancing at Elementary Literacy is that if we can get to our children and if we can get to more children, we will not let them leave school before they are reading well, and then we will advance the adult literacy rate in that way and have the cascading effects on the economy.
:
Thank you for your question.
[English]
One of the things that was incredibly helpful is that many of the funders were there from the very beginning. Many of us—the community foundation, the United Way, the provincial government, the municipal government—were the ones sitting around the table saying, “Something has to give, and it must be us.” We didn't have the uphill battle of trying to convince the funders to do things differently. We were trying to figure out for ourselves how we lined up. In terms of changes, Living SJ provided the United Way with a template for what we should be investing in and how we should be investing.
We have a team of reviewers that looks at funding applications. When they do that, they use a Living SJ lens. We look at whether this investment we make will drive that bottom line, the bottom line being achieving literacy by the end of grade 2. It's looking at those things that as a community we are trying to achieve and how we make that happen with our own money.
It also shifted the conversation from just the cheques we write, which are significant in our community—we grant about a million dollars a year—to how we can leverage funding. We've been able to put the first $10,000 or $20,000 on the table to assume some initial risk, because as a community-based funder we can do that to attract some funding from the provincial government to test a new idea or to attract a private consulting firm to give us some really great analyses of the work we're doing. Those changes have been able to happen because of our collective approach.
When funders aren't part of the conversation and you have to sell this to them, it's much more difficult. At my board of directors, Living SJ is part of our DNA now. It's part of our board agenda. We talk about it. That is also important in sustaining that role into the future.
It's an absolute pleasure to be here. This is our second panel today. For those of you who weren't here at the very beginning, I'll just let you know that we got in at about 1:30 last night and were up early this morning. If we start to nod off, please forgive us, but you will have our undivided attention for the next hour and a half.
I'm very happy to welcome, from Housing Alternatives Inc., Kit Hickey, executive director. We also have Jody Kliffer, appearing as an individual. From The ONE Change Inc., we have Anthony Dickinson, president. From Economic and Social Inclusion Corporation, we have Althea Arsenault, replacing Stéphane Leclair, manager, resource development. Also appearing as an individual, we have Daniel Shoag—Karen's new best friend—assistant professor at the Harvard Kennedy School.
Welcome, everybody. It's a pleasure to be here. We are moving forward on our poverty reduction strategy study. We are focused in this cross-country trip on the quadrants of housing and neighbourhoods. I'm very pleased to see everybody here.
We'll get started. Each speaker will have approximately seven minutes. If we get close to the seven-minute mark, I'll just raise my hand. I'm not telling you to stop, just to start to wrap things up.
From Housing Alternatives Inc., we'll have Kit Hickey, please.
The next seven minutes are yours.
:
Thank you very much for the opportunity to be here this morning.
I would like to say—because my cheque did arrive—a special thank you to MP Long for all of the work that he and his staff do here in Saint John. We do appreciate it.
I'm Kit Hickey, the executive director of Housing Alternatives. Housing Alternatives is a nationally accredited non-profit resource group providing development and management services to non-profit and co-operative housing projects here in Saint John and the surrounding area. Additionally, we also offer housing and other related services to our homeless population through a provincially funded organized departure project, as well as the federally funded housing first project.
We were becoming increasingly concerned with the long-term viability of the co-operative housing sector in Saint John. A major preoccupation was the expiry of operating agreements and how we could ensure the long-term affordability of housing for low- to moderate-income families and single adults.
In October 2012, the Co-operative Housing Federation of Canada and Housing Alternatives organized a meeting and invited members of the nine Saint John housing co-operatives to attend. Members found that each co-op was facing similar issues, such as financial difficulties, lack of funds for major repairs, ensuring security of tenure for low- and modest-income members, and low member involvement.
It was decided that working together would be essential for our co-operatives to remain strong and healthy. Our group embraced the international co-operative principle of “Co-operation among co-operatives”, and began our journey. A steering committee was formed, with representatives from each of the nine housing co-ops. Each steering committee member was tasked with getting approval from their own co-operative to participate on the committee, and agreed to regularly report back to their co-operatives.
At a goal-setting meeting in April 2014, the group agreed that the purpose of the committee would be to explore opportunities for housing co-ops in Saint John to work together by considering the impact of consolidation. The goals of the committee included a financial analysis of all participating co-ops, developing and maintaining a communication plan, discussing the advantages and disadvantages of a possible merger, reviewing and discussing other best practices and other successful mergers, and meeting with stakeholders to develop a merger process.
Once the analysis was complete, it became clear that by merging, the co-operatives would see the following benefits. First would be financial savings, including decreased audit fees; decreased insurance premiums; bulk purchasing options; group tendering of contracts for snow removal and lawn care; and decreased risk in the cost of vacancies and arrears. There would also be increased interest in leadership roles; prevention of board member burnout; increased involvement; more access to time and/or funding for education; and an increase in new ideas and direction for the co-operative. Other benefits include a larger and stronger voice to government, the ability to refinance for capital repairs, a larger pool of units, and the ability to explore new possibilities.
Co-op failures are more likely where size threatens the ability to have good governance and management. By merging and creating a strong and viable co-op, the Unified Saint John Housing Co-operative is decreasing the threat of lost units to the Canadian housing co-operative sector. We are also protecting affordable housing in Saint John and providing a positive model for other co-operatives across the country, to ensure that affordable homes are not lost.
On January 1, 2016, eight of our co-operatives merged into one new 252-unit co-operative, now called the Unified Saint John Housing Co-operative Ltd. Each of the neighbourhoods of the previous housing co-ops is represented on the board of directors. The housing co-op received the Co-operative Housing Federation of Canada's award for co-operative achievement at the annual meeting in Hamilton, Ontario, in May 2016.
In conclusion, the members of the newly formed housing co-op report a high level of satisfaction. We feel confident that with this pre-emptive action taken by the sector, the long-term viability and sustainability of these affordable housing units is secure. We proudly see this as an example of how our community takes a leadership role to be innovative to solve issues.
Thank you very much.
Thank you to the committee for hearing what I have to say today about land banking.
By way of background, this is a piece of research I did at graduate school, at UBC, back in 2007. That's why I'm reporting to you as an individual today. It's just something that came out from my past and has followed me like a wounded dog for seven years. So here I am before you to talk about some of the highlights of land banking as a tool that's been used throughout North America.
Basically when you think about poverty, it tends to manifest itself in many different ways. When we think about the solutions to it we have to have a holistic approach that involves both the health and education employment components of poverty, but also the built environment and how poverty has struck down a lot of our communities and neighbourhoods.
Poverty in Saint John, like many communities, is concentrated in pockets, which you've probably heard a lot about today. Especially in eastern Canada, these neighbourhoods have a lot of older building stock. CMHC tells us that anything built before 1930 has a very high occurrence of needing repairs, which is basically the entire building stock of the urban core of Saint John. It's not that it all needs repairs, but it certainly falls in the category of being built before 1930.
As some of these communities have experienced decline over the past 50 years, for various reasons, what tends to go down is community pride, tax revenue for cities and provinces, the safety of these communities, and reinvestment in lateral adjacent properties or properties in a similar area because there's no confidence among the private sector. What goes up at the same time is a cost to city resources to send emergency response vehicles to police these neighbourhoods—fire trucks, ambulances, and so on. Future blight also goes on the rise in these communities, as do crime rates. That cycle of decline enters into a very aggressive pattern, and it's hard to turn away from that without strategic thinking.
How does decline typically happen? As we know, for different reasons an owner of a property is not able to pay their mortgage, whether it's an absentee landowner who no longer sees value in the return on investment on their property or it's a landowner who, for whatever personal reasons, is unable to make mortgage payments. Tax accumulates on that property. Eventually it becomes abandoned and begins that cycle of deterioration, if it hasn't already entered that state, and the property is foreclosed. Then it goes to tax sale. This process takes about seven years or longer, and meanwhile there's been no reinvestment in the property. As time goes by, the return on investment on those properties becomes even more bleak.
So what is a land bank and how does it interface with these problems? The mission of a land bank is to restore integrity and community pride to these neighbourhoods and stabilize that process of decline. We'll talk in a bit about how it does that. It is a strategy that deals with the poverty of our built environments that form the physical conditions of poverty around us. It started in Michigan back in 2001, I believe, in a town called Flint, but later was adopted by Detroit, and now has spread across America, from San Francisco to St. Louis to Cincinnati to almost every major urban centre that has some form of abandonment. It's been a very useful and strategic method to return properties and buildings to new uses in the communities and stabilize that process of decline. Although it has not yet been adopted in Canada, I think it looms as a potential new strategy for us to consider.
The structure of a land bank is that typically it is a quasi-governmental organization comprised of about nine or so members; a couple typically are politicians, to build in the transparency of a land bank. It's a not-for-profit body. It looks at real estate properties in the city where it's working and tries to assign value where the regular real estate market has failed to assign value to these properties anymore. Basically it looks at properties that nobody else is looking at.
How does it work? It has three areas of interest. It acquires land sometimes through purchase, sometimes through donation. A lot of times you'd find somebody who doesn't want to actually own a property because they just inherited it, or there's no value to them. Land banks have the unique ability to expropriate land if the right circumstances are present for them to activate that power, which in the States is given to them by the state.
The second area of work it does is it maintains land. It creates green lots. The property building is way beyond feasible repair. It knocks the building down and creates a green lot instead of having blight. It can put community gardens into these spaces to offer food to the community, and it can restore buildings if they've not deteriorated enough to require being knocked down.
The third area of activity of a land bank is to divest itself of land. It's not there to hold land forever; it is there, rather, to repurpose it and reposition it. A land bank could go to affordable housing outfits to offer side lots to adjacent neighbours once the building has been removed and it has become a green lot, or it could go to new development if it's been able to acquire several adjacent properties. You could reposition that for sale.
One of the powers that is needed, typically, by a land bank in the States is the power to clear property taxes. A lot of times, a barrier to reinvestment in property is that the taxes have accumulated for so many years. A land bank has the power to eliminate those taxes. Another power needed is the power to clear the title on land. A lot of times, especially in older cities where there have been estates and inherited lands, the title can get very confusing over time, and that's a barrier to reinvestment. A land bank has the power, as I mentioned, to expropriate land, a power given to them by the state. Decisions are made by the committee when that is an appropriate power to exercise. A land bank can expedite the foreclosure process, so instead of taking seven to eight years, the process goes to about two years. The building in question doesn't reach that critical state of decline. A land bank can also make quick decisions. It doesn't have to vet its decisions through any government body, such as a city council. It's empowered to make decisions on its own by its own governance structure.
The benefits that fall out of a land bank have been robust in a lot of the communities that have them in the States. There's neighbourhood beautification, to start with. Land banks have stabilized the decline of the communities they operate in. There's new tax revenue in a lot of cases for the buildings that have been repurposed. They result in safer streets. They have more affordable housing that has been turned over to outfits that are active in that portfolio. They've retained a lot of old building stock because, instead of buildings going too far down the path of decline, land banks are able to stabilize that process more quickly and return these assets to the community. In some cases, they improve the food supply to the community, as more community gardens tend to operate.
The financing of a land bank has typically come through seed funding that comes from the government or from not-for-profits. They're able to operate because they don't pay taxes on the properties that they own. One revenue stream beneficial to land banks is the increased taxes to any properties repurposed for use in the private sector. For five years after a property is repurposed, the land bank retains the increased taxes. So it goes to the land bank for five years before it's returned entirely to regular format. Land banks are also able to generate revenue from any sales of properties.
Why Saint John? The evidence is clear. I think we have a lot of properties where poverty is concentrated—especially in some neighbourhoods where Kit's group and other groups in our community work in the north end. The real estate market has not been successfully assigning value to a lot of the properties and buildings. If we don't do something soon and the status quo remains our strategy, then demolition and further decline is probably everything but certain.
Thank you.
Thank you to the chair and to the rest of the committee for the invitation to speak today, and to the rest of the presenters this morning.
I want to focus my remarks on the need for safe and affordable housing, particularly how it relates to neighbourhood-based poverty reduction, which I would look at as an essential piece to any poverty reduction strategy. I am going to be speaking to you from my perspective as board president for The ONE Change Inc., which is a grassroots community development organization. However, my remarks will certainly be flavoured by my day job as a men's homeless shelter director for Outflow Ministry; my long-time advocacy for the homeless community in Saint John; and also my time living in the old north end, which is one of the priority neighbourhoods in Saint John.
Time is short, so I'll limit my remarks to two key areas. First, I'll discuss what type of housing, in my view, is needed; and second, I will discuss the importance of community, both its physical layout and its residents. I'll conclude my remarks by suggesting a way to crystalize our thinking.
What type of housing do I believe is necessary? The terms of reference given to us to prepare for this morning touches on my answer. One of the main areas raised for the study is on affordable housing. May I respectfully contend that this term of reference is incomplete? Saint John is in need of housing that is not only affordable but also safe. Today Saint John has housing that is affordable. We also have housing that is safe. The trick, in my mind, is to have housing that is both.
Let me provide you with two examples. ONE Change operates the Nick Nicolle Community Centre. We recently commissioned a study about the use of that centre and how to use an adjoining building that was vacated when the neighbourhood school closed, how we could use that building to benefit the community. One of the comments made by a community member is that they use our community centre as a place to get warm in the winter because their apartment is too cold. Clearly this apartment is affordable, but it is not safe.
The second example comes from a man who used the Outflow men's shelter. He excitedly left the shelter one day to move into his own place. It was a time of handshakes and celebration for everyone. He came back to the shelter two days later in need of a bed for the night, covered in scars from bedbugs. The building he moved into was infested. Again, the apartment was clearly affordable, but it was not safe.
Neighbourhood layout is also important when we consider safe and affordable housing. Housing is not only safe and affordable based on the unit or building itself, but also based on the physical place the building is. ONE Change is proud to be part of what we would call the corridor of services, which includes the NEW-C or the North End Wellness Centre, RiverCross mission, St. Luke's church, the Harbour church, the North End Food Bank, and our own Nick Nicolle Community Centre, which are all within a few blocks of each other.
Each of those services contributes to safe and affordable housing by providing residents with some of the services, meals, and community that they need in order to live flourishing and dignified lives. Such pieces of a community are crucial. At ONE Change, we are proud to offer all of our programming for free. No one is quizzed about how worthy she or he is to receive programming or about whether their household income is low enough to warrant a program subsidy. Instead, everyone is treated equally.
A family locked into a third generation of poverty will receive the same high level of service when they walk through the door at the Nick Nicolle Community Centre as a member of Parliament does. In my view, this is essential to providing a dignified service to our residents, because it means that everyone who walks through the door is an equal. Maintaining safe and affordable housing on a limited income is difficult. There are unavoidable expenses. Accessing the programming, whether educational, recreational, or athletic, that helps people break the poverty cycle should not add to these expenses.
I want to mention one more thing about ONE Change. I said earlier that we are a grassroots organization, and I mean that. Resident input is welcomed and it is encouraged with everything ONE Change does.
We have doors open to the community, and we are also eager to solicit its advice. With whatever ideas this committee has, please, please make sure you take your lead from the citizens that these ideas will most directly impact. Their voice matters every bit as much as mine does, and you have as much of an obligation to listen to them as you have to listen to me.
I would like to close my time by suggesting a framework for our thinking. At first blush, you may think this is a little bit pie in the sky or perhaps even silly, but please hear me out. My suggestion for you is to think big every single time. Poverty reduction is not good enough. Poverty reduction makes statistics shrink and people feel good, but it leaves other people behind. Our goal should be the end of poverty. That is a big dream.
Homelessness and a lack of safe and affordable housing is a big problem in Saint John. Generational poverty is a big problem in Saint John. Further than that, poverty in general is a big problem in Saint John. I am encouraged by this committee's desire to try innovative solutions and to give Saint John an opportunity to try out these new ideas. We are not going to solve poverty with the status quo. We've tried that, and it did not work. With every single idea you have, please ask, “Is this big enough to end poverty?” If the answer is no, then please scrap it and dream bigger.
It has been a privilege to present to you this morning and to share the floor with my colleagues. I appreciate your time.
Thank you. Merci.
Thank you for inviting us, and I send regrets on Stéphane Leclair's behalf. He had to attend a meeting this morning.
The Economic and Social Inclusion Corporation, or ESIC as we call ourselves, is a crown corporation of the provincial government. Our program is to oversee the implementation of “Overcoming Poverty Together: the New Brunswick Economic and Social Inclusion Plan”.
We have a role; we don't do a lot of the groundwork stuff, but it's partnerships, and we're here to support and foster and bring partners together to move projects toward poverty reduction. You can almost consider ESIC the backbone of poverty reduction for the province of New Brunswick.
We are governed by an act. We are in legislation. We are not a secretariat. And the one thing I would recommend to this committee is that if you're going to do a poverty reduction strategy, ground it in an act in legislation so it does not change.
Our mandate is to develop, oversee, and coordinate the implementation of the strategic initiatives and plans to reduce poverty and to assist thousands of New Brunswickers to become more self-sufficient. We have our vision. We also have a goal. It's very lofty. It was decided that by 2015 we were going to reduce poverty by 25% and deep income poverty by 50%. Is that obtainable? Probably not, not right now. We didn't get here in five years. We're not going to solve it in five years, 10 years, or 15 years. But working together in partnerships to make us stronger, we will make those numbers go down. And more importantly, we're going to make an impact on people's lives.
The board of directors has a unique structure. I think we're the only structure like this in Canada when you're looking at a provincial poverty reduction plan. We are comprised of four sectors. No one is greater or has more power than the others. We are representatives of government, business, non-profit, and citizens. Right now we sit as a board of 17. We have three government ministers on our board—the ministers of social development, education, and Service New Brunswick. We have three representatives from non-profits across the province. We have three representatives from business. But there are six members on our board of directors who are citizens. They are citizens who are or were living in poverty. Their voice is the most important, and we show we believe in that because we have six representatives of citizens in poverty but only three ministries, three non-profits, and three government reps. And that is the most important to us. These people will tell us when we have a plan that just won't work, because they've lived it and they'll tell us the reason why we're building a roadblock, or why there is a roadblock.
That structure is the same that goes down to our 12 community inclusion networks, and any of their boards of directors as well. It also is the same structure that goes to any of our working committees or our advisory committees. There are always representatives from those four sectors on our boards and our committees.
We are in what we call OPT2. It's the second phase of Overcoming Poverty Together. We have finished OPT1 from 2009 to 2014. We are in the 2014 to 2019 plan. In our second plan, we have four pillars—community empowerment, learning, social inclusion, and economic inclusion. The strength is that it's not our plan, not a government plan; it is a plan of the people of the province of New Brunswick. We went through consultations, we asked everyone, we invited everyone to come, and we made certain that citizens had funding for availability and transportation to come and have a voice. These are their ideas; it is their plan. It is what we use as our guiding principles. Do we take action and lead in all 28 action items for OPT2? We do not. We cannot. And our strength is the fact that we go out and seek partners—partners within different government departments, partners within the non-profit sector, partners within the business sector—so that together we will be able to make an impact and move these items that we have for poverty reduction.
Here are some things we've done in Overcoming Poverty Together. One that we developed in partnership with everyone else is a New Brunswick drug plan, and that drug plan is available for people who do not have insurance coverage. We developed Healthy Smiles, Clear Vision, which is a vision and dental program for low-income children. We have a community economic and development investment fund under social enterprise.
What we're working on in OPT2, as was mentioned by the previous group, is transportation. We're about to release a report in the spring of this year on urban and rural transportation, because if you have a job but you can't get there, you don't have a job. If you don't have transportation, you can't get to your medical appointment. You can't go get your chemotherapy because you can't afford a car. It's very important.
We're also looking at developing a one-stop shop. In communication we have found that individuals, when we talk to them, don't know about our programs; they say they know they're out there, but they have to ask us how to find out about them.
With the Human Development Council and the Government of New Brunswick, we're actually going to be developing research to look at a merged system between the Government of New Brunswick and the non-profit sector. It would be one place to call to get all the information. As a government employee, even I have trouble trying to navigate the provincial or the federal system. We're also going to be setting up an advisory committee for pay equity and living wage in the upcoming months.
Our biggest strength is our community inclusion networks. We developed them. There are 12 of them in the province of New Brunswick and they are based on the communities and the communities' needs. As a province, we have an Overcoming Poverty Together plan, but parallel to this, each CIN, community inclusion network, has their own poverty reduction plan that also reflects the needs and necessary areas of focus in these communities.
We have funded over 392 initiatives since November 2011, and we've participated with over 45,000 people who have actually benefited from these programs. The most important thing we have found is that ESIC has invested over $5 million. The community has invested over $16 million, in cash or in kind, for a total project value of $21 million. Our return on investment ratio is that for every one dollar ESIC puts in, the community puts in $3.80.
Was it that way at the start? No. We were looked at as the bank and everyone was coming in asking for grants, but we went back and talked about how you're only going to be strong if your communities are strong, and if your partners are there with you. That is one of the strengths that has been able to grow the community inclusion networks across the province of New Brunswick in the last five years.
Eighty per cent of our funding actually goes back into the communities, and that's how we support it. All of our project funding goes through the 12 community inclusion networks.
We have statistics like everyone else—LICO, LIM, and the market basket measure—about how we're trying to reduce poverty in different areas. We have the struggles of all the other non-profit organizations about measurement. We have the struggles of all the other provinces when we're talking about FPT and PAC organizations. The measurements are weak. We've had those discussions because ESIC is a part of PAC. Please talk to Statistics Canada and get a measurement that can be used across the country for poverty reduction.
Our biggest thing is our partnerships. As I said, we partner with local groups on the community level, but we also do partnerships at the federal level. In front of you are two little flyers about what we're doing. One is a major project with the Canada Revenue Agency, a community volunteer income tax program for low-income individuals. We do that in partnership with the CRA, and we've been doing it for six years.
When we started, there were about 13,000 people registering to get their taxes done through the CVITP. Now, through our provincial involvement and by bringing in the public libraries, Service Canada, first nations, the Department of Health, and the Department of Employment and Social Development, we've raised that amount by over 7,000 people. Now we have about 22,000 people in the province filing their taxes through CVITP. We also have the Canada learning bond that we are doing with ESDC, and we're promoting that as well.
The strength of what we do is in our partnerships.
Thank you.
My name is Dan Shoag. I'm an economics professor at Harvard—recently promoted to Karen's friend—and I teach urban economics and econometrics.
This is my first time in Saint John. I'm honoured to be here today to talk to you about my research on the housing market, migration, and inequality. What I am going to have to say is a much more macro picture than some of the talks, so I hope it's useful. My research focus is on the U.S., so I'll begin by speaking about the American experience, but I think there are important lessons for Canada. I'll conclude by discussing some of my initial investigation of the Canadian data for this purpose.
This research project actually began as a failed attempt to create a homework assignment for my students. There's a famous relationship in urban economics called “income convergence”, which is a fancy way of saying that poor places tend to catch up to rich ones in terms of income per capita, and they do this by experiencing faster income growth.
I know it's weird today to think about poor places like Alabama and Mississippi having the fastest income growth, but that was true. It was actually true for over a century, starting when we first had data after the Civil War.
The assignment was going to be to ask my students to demonstrate this catch-up, the fact that poor places are catching up to rich ones, in the last 20 to 30 years of data. Thankfully, I tried my own homework first, which doesn't always happen. It's good that I did in this case, because that relationship has gone away. In the last couple of decades, poor places are no longer catching up to rich ones. Regional inequality, which had been falling for over a century, has basically been frozen in the last two decades.
The second question on the homework was to ask some students to demonstrate another one of these canonical relationships, which is just showing that people move from lower-wage places to higher-wage places. That seems intuitive. People should move towards higher wages. Again, that's something that had been true for as long as we had data. However, again, like income convergence or catch-up, this directed migration towards higher wages has pretty much stopped in the last few decades. Instead of people moving towards richer places like Connecticut or New York, Americans are now moving to mid-wage places like Florida, Texas, or Utah. That's a big change in the way migration had worked in the U.S.
These two canonical relationships that had existed for a century, this catch-up in regional income and people moving towards higher-wage places, have both fallen apart in the last 20 to 30 years. The timing is not a coincidence. Migration has a big impact on income growth and inequality. It allows people to move to opportunities, people who have poor local opportunities to find jobs in higher-wage places. It reduces labour market slack in labour markets where there are few jobs. Therefore, it makes sense that a decline in migration could have effects on catch-up.
Having failed to generate a productive homework, though, I now had to figure out why migration patterns have changed so much. The answer that jumps out at you is the data, and I think the reason that I am here is that it's housing. There's been a dramatic change in housing markets in America's richest cities in the last few decades at the same time that these patterns have reversed.
It's always been the case that rich places are more expensive than poor ones. That's not surprising. I once gave a disastrous interview with a journalist who summarized my work as Harvard professor finds that New York is more expensive than Alabama.
Voices: Oh, oh!
Mr. Daniel Shoag: I took a lot of guff for that.
Bad interviews aside, the point is that places like New York have always been more expensive than Alabama; that's true. However, they are much more expensive relative to the poor places than they used to be. They used to be a place with 1% higher wages and 1% higher housing prices. That is now double in the last few years.
The consequence of this is that it has very different effects on high-education and high-income workers and low-education and low-income workers. That's because housing takes up a much larger share within a city of low-income budgets. You can take two occupations, let's say janitors and lawyers. Fifty years ago both occupations paid 50% more in New York than they did in the south, and that was true before and after adjusting for housing prices. Today, both occupations pay 40% more in New York than in the south. When you take out housing prices, for the lawyer it goes down to about 35% more in New York than in the south. For janitors it goes the other way. They actually have more income net of housing costs in the south than in New York. That's because housing just takes up a huge chunk of lower education wages in New York.
As you would expect, this jump in housing prices in the places that offer the highest wage really changed migration patterns. College-educated workers are still moving to San Francisco and New York, but less-educated workers are moving out. It's not that they don't want the higher wages. It's just that with that net of housing costs, these places offer them a bad job. This sorting of skills leads to segregation. It keeps less-educated workers from their best opportunities and the places that would offer them the highest-paid jobs. It increases income inequality and stops that regional income catch-up or convergence that I began by discussing.
To recap, I argue that there is a change in housing markets in America's richest cities that changed regional migration patterns and income catch-up. Why did housing markets change? I think the answer is pretty clear here too. When prices are rising and the quantity is static or falling, it's a supply issue, and when you look at the data, it's pretty clear that there are restrictions in place. Construction costs actually don't differ that much. Brick prices don't differ that much city to city. Cities like Boston, where I live, are not actually that much more densely populated than the cheaper places like Houston, or in fact not at all. Therefore, it's not the physical space that limits. The culprit is really regulations and restrictions that prevent development.
I feel this personally. Until two years ago, my wife and I lived with our kids in an apartment in Brookline, which is a nicer neighbourhood in Boston. You might know a famous resident, Tom Brady, who doesn't live in a small apartment like we do.
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The building was five storeys, but each apartment would have cost more than half a million dollars—we were renting—if it was on the market, and with dozens of units on the floor, it would have been very profitable to build a sixth storey. They couldn't because of height restrictions in the city. Therefore, they were unable to add units, which raised prices, and eventually it crowded out lower-skilled workers like me, who had to move out.
In my research, I created a measure of land use restrictions and regulations over time and by place, so you can see that it's only when one of these rich regions really starts putting in significant restrictions on development that prices rise and migration stops as less-educated people are pushed out and income catch-up ended. Places that don't put in these restrictions or regulate less have much less of this problem.
I know it's weird to think that local development policies—or at least what's very local in the U.S.—and land use restrictions have big national consequences or that these policies, which are set at very local levels, will affect things like national income catch-up or convergence, or national migration patterns, but that's what the research shows. When the legal environment changed 30 years ago and made these policies much more common, these local policies became a national issue. I think there is, or was, increasing recognition in U.S. policy circles of the national importance of this issue. I know that President Obama's Council of Economic Advisers had written a report specifically about this topic on their way out, and on the research that I'm discussing here today.
I want to end by talking about what things look like in Canada. I don't claim to be an expert on the Canadian data. It is more complicated because the regional dynamics are complicated by fluctuating national resource prices to a much greater extent than in the U.S. Still, if you look at the data, you can see that, while income convergence, catch-up, and migration towards richer places is still occurring, there does seem to have been a slowing in recent years. Recent housing price trends in some particularly higher-wage or productive cities do raise concerns about the continuation of those trends. For a body that's interested in a national perspective on poverty, opportunity, and inequality, I think that development policies that might seem like local matters are actually important when you're thinking about these macro-level issues. The possibility of pricing people out and creating this segregation based on education or income levels is an issue that should be on your radar.
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One of the things that recently happened, I guess, in the old north end in the last two years or so is that we lost our middle school through the school closure process. The numbers weren't high enough. It's been ONE Change's position that a neighbourhood needs a school. We're working at how to address educational issues and how that gap is there, but our programming isn't focused exclusively on youth. We have educational programming for adults, for example.
I can't remember if this is anecdotal or a stat that I read somewhere, but one of the folks I was talking to mentioned how few people in the neighbourhood know about UNBSJ being just over the hill. So one of the things in my mind is to let people know, or teach people, that education is valuable, whether through NBCC or UNBSJ or whatever.
It's also, in my mind, important to figure out what is the specific issue causing their poverty. Is lack of education what is making them unable to get employment, or is it something as simple as the fact that the employment available is for overnight jobs but our buses don't run overnight? We always have a lot of ideas about how to fix things years from now. It would be great if we could come up with ideas for people now, today, who are living in poverty.
I used to work at a call centre, like a lot of folks my age, and that call centre closed. A lot of my colleagues went to a new call centre that was opening, but one of them took a lower-wage job at a different call centre because he could walk to it. When he did the math, with the cab rate from that call centre to his home, he would actually have been losing. His net income would have officially been higher, but the cost of getting there would have been worse because the buses just didn't work.
With access to transit, I think the way the federal dollars worked was per rider, so then more could go on, but that doesn't address the need that a lot of.... When I lived in Vancouver, I would take public transit. It didn't even cross my mind to own a car, but that's not feasible for my line of work now.
One of the employees at the shelter, when his overnight shift would end, had to walk home or take a cab because the first bus wasn't going to come on a Sunday morning until 10 a.m. These types of things are putting up barriers that don't need to be there, I guess, is what I'm saying.