Inclusive Local Economies / Metcalf Fellowship
Metcalf Interview: John Stapleton
2018

One of the foremost experts on poverty in Canada, John Stapleton has dedicated the greater part of the past fifty years to improving income security for all Canadians. Following a twenty-eight year career with the Ontario Ministry of Community and Social Services, where he held a number of positions including Senior Policy Advisor to the Social Assistance Review Committee and as an Ontario delegate to the founding of the National Child Benefit, John became an independent consultant and policy advisor. John is the only person in Ontario to have served on the most recent poverty reduction and income security reform processes at all three levels of government, having participated in Ontario’s Advisory Group on Income Security Reform and the Toronto Poverty Reduction Strategy. He currently sits on the national Ministerial Advisory Committee on Poverty.

A Metcalf Innovation Fellow since 2006, John has published nine reports with the Foundation. He spoke with us earlier this year from his home in Toronto.

 
Metcalf:

What are the biggest misconceptions that people have when they think about poverty?

John:

The single biggest misconception is that poverty is somehow a result of an individual deficit that the poor must overcome ‘on their own’. This assumption is flawed in many ways. First of all, we’re living in a very rich society, where almost ninety per cent of residents do quite well. We’re going through a great transformation in our labour force that benefits people who make a lot of money. This in turn generates a cadre of people who support those workers, the office cleaners, food servers, and others who are last hired, first fired etc. We’re already seeing the rise of an almost indentured class of labour that serves an elite of professional and knowledge workers. So not only do we have an economic system that produces unemployment and underemployment but we are also creating a permanent underclass. Therefore, to locate the issue of poverty within the control of an individual is a mistake. Because it’s not the fault of any particular individual that the only work they can possibly get is part-time, doesn’t pay very much, or is provided through the informal economy.

I think we have assumed that there is good work available for able people and that this work will allow them to make ends meet. And that’s just not true. Additionally, when we think of poverty as an individual’s fault, we presuppose that our social security programs are robust and they are not. When an individual tries to access income security benefits, often they find that it’s very tough to receive benefits like social assistance, or even impossible to get, like different parts of our employment insurance and our employment support systems.

Finally, one of the reasons that we’re seeing such a renewed interest in basic income and guaranteed annual income is because people are looking for programs that wouldn’t be triggered by work, that wouldn’t be time-limited, and wouldn’t be inadequate. Whereas what we have now is a system where eighty-eight per cent of expenditures in our income programs for working-age adults are work-triggered and financially inadequate. And most, but not all, expenditures are time-limited.

Metcalf:

You have dedicated most of your life to reducing poverty in Canada. In your opinion, are Canada’s poor better off now than they were fifty years ago?

John:

I started washing walls in an old age home in 1968, so I’m entering my fiftieth year of working in the poverty reduction space. The short answer to your question is yes, Canada’s poor are better off, but it’s complicated. Governments, working separately and together, have created a system that has brought people out of the deep poverty that they were in decades ago, but many still remain in what I would call shallow poverty. I don’t think since the 1960s that we as Canadians have taken a comprehensive approach, one in which we look at the whole of our poverty reduction and income security systems. In Canada, generally speaking, we have been very good at attacking one problem at a time.

In the latter part of the ‘60s and into the ‘70s, we started to look at poverty amongst people over the age of sixty-five. We put in a system that could be called a guaranteed annual income for people over sixty-five. It doesn’t actually get all people over the poverty line but through various programs that we’ve bought in, the Canada Pension Plan, the Old Age Security Plan, the Guaranteed Income Supplement, the GAINS Program, and various tax credits, when you put them all together, we have taken most seniors out of poverty. In some places, around ten per cent remain in shallow poverty. For example, a single senior who has lived here their whole life with no other income and no CPP receives an income of just over $20,000: that is just under the poverty line of $22,000.

At the end of the 1990s, we moved our focus to child poverty. Through different mechanisms such the federal Canada Child Benefit, and provincial programs like the Ontario Child Benefit, we were able to bring an awful lot of children out of poverty.

Our present efforts are with the working poor. Next year, in Ontario, a full-time minimum wage job will result in an annual wage of around $29,000, which is approximately $7,000 higher than the present poverty line. And that’s really quite extraordinary. At the same time, the federal government has announced its signature changes to a new program called the Canada Workers Benefit that started out as the Working Income Tax Benefit. This program targets the working poor – you have to be a low-income worker to get it. Over the next two years, the federal government is going to be putting another $700 million into that program.

Of course, there have been various attempts to improve our income security system for people with disabilities and for people who rely on social assistance, but they haven’t done nearly as well as seniors, children, and the working poor.

John with friends in 1974, one year before he joined the Ontario Public Service.
Metcalf:

Let’s talk about the rise of the minimum wage in Ontario. Raising it to fifteen dollars an hour has been seen as a victory by some people and other people think it is totally inefficient because it will drive up the cost of living. What are your feelings about the controversy?

John:

My feeling about the controversy is that people aren’t really debating whether the minimum wage has gone too high: they seem to be debating the speed with which it’s being implemented. I don’t see conservative commentators or people who are progressive talking about whether there ought to be a $15 minimum wage. They’re just talking about how fast it should come in.

The argument in favour of raising it is that people are able to earn a decent living. I think that those who believe that minimum wages should be lower have to admit to themselves and to the world that if this is the case, then we have a business model that relies on a very large cadre of people living in poverty. And if you have an employment model that requires a significant portion of its labour force to live in poverty in order for business to be viable, then we have to ask: is this the sort of system that we want?

If we have a system where people actually earn a decent living, then we’re going to find that many of the deficits that occur with poverty are alleviated. With the raising of the minimum wage, there are going to be better outcomes in terms of health, which will have repercussions across government spending because half of our provincial budget goes to health care. The cost of poverty, as it relates to health costs, is very high. If you solve poverty, you’re going to resolve a lot of the demands on our health system as well. Reducing poverty also takes the pressure off the court system. And when we have people making more money, they are able to afford more goods and services, and the economy grows. So, there’s an awful lot to like about a high wage economy.

Metcalf:

There’s been a lot of discussion about how rising interest rates could put many Canadians financially underwater because they are carrying too much debt. How close do you think many Canadians are to slipping into poverty?

John:

There are always going to be people who are not in poverty now but who would slip into poverty because of economic tightening and interest rate increases. And I’m always astonished when I hear stories of people who will obtain as much retail credit as possible, who will buy the biggest house, the biggest car, etc. Years ago, we didn’t have these kinds of instruments. We didn’t have homeowner lines of credit and payday lenders who could cycle you through a never-ending debt cycle. People didn’t have the ability to become as indebted as they do now.

At the margins, you will see people who, if they have a modest income, sink into poverty. But absent a catastrophe like a massive fall in equities, in derivatives, and things like a massive drop in the housing market, in Canada, I think it will not be terribly widespread. Usually it’s a confluence of events that leads to someone going on public assistance.

Metcalf:

Many Canadians will retire without a pension and have low to no RRSP savings. Do you think these factors will lead to higher poverty levels in Canada as the population ages?

John:

First of all, not everyone retires at age sixty-five. Seniors are not retiring as early as they used to – they are working longer. Secondly, this whole assumption that when people hit sixty-five, all of a sudden, they’re spending less and they are working less is false. All of the empirical studies now coming out are telling us that just isn’t true. The theory of lower consumption and lower work effort is just not evidence-based. The evidence shows the exact opposite. Seniors as a group are making more money and they’re actually spending more money. Older couples with pensions who are now fully retired are often spending close to $100,000 a year on their care and other expenses. They’re employing all sorts of people as caregivers and are spending a whole lot more money than they spent ten or twenty years ago.

Currently over fifty per cent of our income security in Canada goes to seniors. And that’s a number that’s growing. Seniors take more of our income security system than other segments of the population such as working-age adults or children.

The question becomes how we extend income security to everyone so that it’s fair. My solution is not to take income security away from seniors but rather to greatly expand it for working-age adults. Build a suite of programs that will provide help to them while they are working. I just think it’s too difficult in our current climate to dismantle old age security and replace it with some sort of guaranteed income or basic income. Our current programs are too large, too entrenched, and too popular.

Whenever we have a discussion about guaranteed annual income without talking about specific programs, it’s really popular. But if I told you that we’ve got this great idea but to implement it we’re going to cancel Canada Pension Plan, the program you paid into for the last 40 years, and then we’ll do the same thing with your Old Age Security and Employment Insurance and all of these other programs that you paid into over the years – I don’t think it would get very far. It’s not a zero-sum game. We have to grow our system for working-age adults, not shrink our programs for seniors and other Canadians.

Metcalf:

You’ve worked in government and now you are on the other side of the table, advising government. What is the biggest mistake that you think people make when they approach government to solve the problem of poverty?

John:

While in government, I felt that advocates and activists did not really make it their business to understand government, why it was there, or what it was doing. They would come to the government and ask for things to be bigger, better, faster. One of the things you realize when you’re in government, is that you don’t really have a whole lot of power, either as a public servant or as a minister. I saw all sorts of ministers who came into their portfolios who wanted to achieve things and couldn’t. Even though they are in Parliament, there are checks and balances, whether it’s money, public opinion, or their own personal popularity. The same is true for public servants. When I got out and realized that people think that government is this all-powerful entity, that if you simply have a meeting with the minister or with public servants, that they really decide what goes on, I was surprised. The reality is exactly the opposite.

All the advocacy organizations that have had major successes, whether that’s the anti-smoking movement or Mothers Against Drunk Driving, the groups that have fought for greater funding for autism and developmental services, for the improvements in mental health – they have had successes, in my mind, because they connect with the public. They don’t necessarily connect with government. Government follows them – it doesn’t lead them.

Governments typically are distrusted and disliked by the public. A minister will always tell you: get out there and talk to the public. Don’t talk to me. I’m not the one that’s going to be able to bring this change in. It’s you. You’re going to be able to do it if you go out and talk to the public. I think it’s the advocates that are best able to reach the public. 

Metcalf:

How has working as an independent consultant changed your approach?

John:

When you’re in government, everything you write goes into a cabinet submission, a policy submission, into an implementation manual, into regulation or legislation. Your name’s not on it, so you are invisible. And when you come out of government and launch a second career as a policy analyst, all of a sudden, you’re starting from scratch. You don’t have a list of publications in government. And that’s true for everybody in government.

That’s why it’s so extraordinarily difficult for people in their fifties and sixties to then launch a second career. The Metcalf Innovation Fellowship has allowed me to attend meetings and conferences and things like that. It’s been unbelievably supportive to have a small bit of funds.

The other thing is seeing how rewarding working outside government can be. Back in 2012, when the Metcalf Foundation released The “Working Poor” in the Toronto Region: Who They Are, Where They Live, and How Trends are Changing, I believed that if we took the analysis, the specialized maps and data that we created, and shared this approach with people in other cities, this type of report, would proliferate. It took several years but then these types of analyses started to be produced in places like Montreal and Vancouver, and a number of cities in Ontario.

It was an extraordinary lesson. Foundations often think that if they come out with a publication, suddenly others are going to explode on the scene with the same thing. But it takes time. The Metcalf Foundation demonstrated that it has the necessary patience for others to join in the conversation.