Canada Report Card

1. Compared to 2024, poverty seems to have stabilized slightly; however, it has stabilized at a rate that is unsustainable for too many households.
   1. Our Material Deprivation Index – which is based on polling gathered in March 2025 – shows decreasing material deprivation across the provinces. Fewer Canadians report feeling less well off than the year prior, However, rates are still too high.
2. The Food Insecurity rate, however, is the highest in history at 25.5% or more than 1 in 4 households. It is also becoming more severe.
   1. Between 2023 and 2024, food insecurity rose by 11.4%; however, it was rates of moderate and severe food insecurity that saw the largest increases.
3. 2024 could be a quietly important year for poverty reduction. This stabilizing poverty is likely the result of several factors:
   1. Across the country, housing affordability pressure has eased in 2024. Our polling found that housing affordability improved in every province across the country – except for Quebec.
      1. Our data aligns very closely with rental trends observed by CMHC. Since Oct 2024, advertised rents have been declining due to increased supply and decelerating migration. CMHC reports that both the secondary rental market and purpose-built rental market may be required to lower rents over the next few years in expectation that vacancies will rise. While we have not yet seen improving rental affordability, there are signs that these pressures may ease.
   2. The previous federal government ushered in a new era of expanded federal social policy, with key additions over the past year. If these programs are properly funded and prioritized, they can continue to reduce poverty as they mature – making this a key strategy the federal government should sustain.
      1. Policies can directly counter poverty in one of two ways, they can increase the financial resources available to households or reduce the need for such resources.
      2. Early signs indicate that federal programs that are helping reduce material deprivation of people include: National School Food Program, National Housing Plan, $10-a-day: Early Learning and Child Care, the National pharmacare program, Canadian Dental Care Plan, and Canada Public Transit Fund
      3. Our data shows signs that the benefits of Pharmacare, school food programs, and childcare & dental care could play a role in structurally shifting the experience of poverty in the country if people are able to fully take advantage of these programs.
      4. It is encouraging that the new Liberal government has committed to protecting these social programs.
4. While the Federal Government has made progress in launching new social programs, the real challenge is ensuring they are well-designed, accessible, and properly funded. To cut food insecurity by 50%, complacency is not an option. Strengthening these programs and targeting investments toward the most vulnerable will be key to preventing a rise in poverty.
   1. The Canada Disability Benefit (CDB) is a good example of a program that had good intentions to reduce poverty for people living with disabilities but has faced strong criticism for being challenging to access, having poor program design and offering an income that is woefully inadequate – with a maximum benefit of only $2,400/year.
   2. While overall inflation had been easing over the last year down to around average of 2%, and interest rates were cut from 5% to 2.75% between June 2024 and June 2025, the Bank of Canda expects that increase tariffs between the US and Canada will see inflation rise again. Food prices have also continued to rise at a rate higher than inflation.
5. The world has entered a more volatile political era, and the Federal Government has shifted priorities accordingly. While affordability remains a focus, planned cuts to operating expenses and increased military spending will limit the federal government’s capacity for new programs. To reduce food insecurity by 50% by 2030, the provinces and territories will need to step up action. Provinces that invest in poverty reduction will likely see continued progress, while those that do not may face rising rates -making provincial complacency increasingly visible.

In last year’s report card we reported on 27 recommendations, including three from previous reports that were fully acted on. Very little progress was made in the context of the remaining 24 to address critical priorities and improve income security and close infrastructure gaps in northern communities.

In 2024, federal policy action concentrated on three relevant points:

1. Finalizing the design of the Canada Disability Benefit (CDB) in advance of its launch later this year. This included announcing $1.4 billion per year in funding for the benefit. The benefit has significant eligibility restrictions and will deliver a maximum of only $200 per person per month. The CDB is a welcome first step given the longstanding absence of the federal government from this area of income security policy, but it is grossly inadequate. Estimates suggest it will lift only about 25,000 persons with disabilities out of poverty.
2. Updating and establishing the details of the government’s updated national housing plan, which includes billions in additional financing for affordable and market-rent housing construction.
3. Rolling out a national school food program . Although the program does not directly address food insecurity by removing its structural causes, this type of program has been shown to improve educational outcomes among people living in lower-income households and provide moderate affordability support for vulnerable households. The latter point is relevant as a response to food cost inflation and was core to the government’s premise for fulfilling this prior platform commitment.

Many of these actions provide important new contexts for how to think about addressing poverty in Canada. Collectively, however, we expect there will be little improvement in poverty rates until or unless there is a change in the trajectory of key contributing factors such as the ongoing need for millions of affordable housing units and more enduring income security reform to help households living on low incomes with the high cost of essentials.

The shift toward slower population growth is perhaps the single most meaningful action government has taken over the last year to address the conditions of poverty. Given that rates of growth in some provinces exceeded 3% in 2023 alone , reducing the inflow of new residents will allow social infrastructure such as housing to catch up with current needs. The shift in rental and housing costs, along with falling interest rates, will support an easing of financial conditions for Canadians. But in real terms, this provides only basic breathing room. Structural reform remains crucial. Earlier this year, the 45th federal election was held. It resulted in the return of a Liberal minority government under new Prime Minister Mark Carney. Because of the timing of threatened tariffs from the United States, the election unfortunately did not focus heavily on issues of poverty reduction and there were no direct new commitments from the government on proposed improvements in Canada’s income security system, other than a commitment to modernize Employment Insurance (EI). While this responds in part to our longstanding calls to enhance EI, there is no indication to date about how this commitment will play out.

We have seen significant announcements from the federal government about increased financing for affordable housing, the introduction of an aggressive public lands strategy so that more units can be built faster and more cheaply on the federal balance sheet, and help for non-profit and community housing partners to acquire and retain housing units so they are not taken over by corporate landlords. These are all welcome new components of the national housing plan. Moreover, the Prime Minister’s proposed new approach to establish a federal public builder program under a new agency, Build Canada Homes (BCH), is a potentially game-changing initiative. BCH is supposed to leverage public land and the mass production of housing, including modular housing, to fill gaps for low-income Canadians and create hundreds of thousands of new units.

Other government commitments — for example, the proposed 50% reduction in development charges for multi-residential developments and the introduction of new tax and financing incentives for purpose-built rental units —respond directly to recommendations made in the 2023 and 2024 poverty cards. The federal government has also heeded our previous calls to reform Nutrition North. In early spring, it announced an external review of the program . It is imperative that the government’s commitment to reform and enhance the program is advanced as a priority in the lead-up to Budget 2025.

A small but important action not to be missed is that in December, the federal government committed to move ahead more aggressively with the implementation of automatic tax filing . This move would help low-income Canadians access benefit programs such as the Canada Child Benefit.

During the election campaign, Mark Carney committed billions in new funding to develop trade corridors and apprenticeship training programs, accelerate the development of Canadian defence capabilities, and build extensive dual-use social and economic infrastructure in order to improve Canada’s domestic sovereignty. These “nation-building projects” could lead to meaningful improvement in the prosperity and standard of living of many impoverished and remote communities, particularly in Northern Canada. But such projects must be undertaken purposefully with the goal of strategically developing local educational capacity, improving social infrastructure such as housing which is critical to domestic sovereignty, and using the projects as an opportunity to close gaps in economic participation.

Finally, we must address the potential economic consequences of a trade war with the United States. If more broad-based tariffs are imposed by either side, inflation may increase (at least temporarily), which could cause significant economic damage and endanger many jobs. Governments will have to ensure that low- and middle-income households are adequately protected in such circumstances — this includes the need to think strategically about income security assistance, offsetting tax and tariff relief in the form of how tariff revenues are recycled in the economy, and implementing strategic policies such as housing and infrastructure investment to improve social and economic resilience.