Manitoulin’s economic dependency ratio over 1.5x higher than Ontario

ONTARIO—Manitoulin’s ratio between income and government transfers is among the highest for connected communities in the province, according to a recently-released commentary by the Northern Policy Institute that states the cost of healthy food in Northern communities is much higher than in the south, despite programs designed to help offset these price disparities.

“The crisis of food insecurity in Ontario and Canada’s north due to the high price of the Nutritious Food Basket is a complex problem with many possible solutions,” writes Eric Melillo, author of the commentary.

The paper states that Northern communities, especially those without road access, face higher food prices because of reasons that include higher travel costs, less market competition and a lack of suitable transportation infrastructure. 

Although Northern communities that have road access to other markets still face higher costs than their southern counterparts, the commentary finds “a positive relationship between community remoteness and the cost of healthy eating,” meaning these effects are felt even stronger in communities without year-round ground transportation links.

The Rainy River and Kenora districts make up the Northwestern Ontario Health Unit. This unit has the highest cost of healthy food per month for an average family of four—$1,018.20. This is $159.39 more expensive than a Toronto family’s average expense, which is $858.81 per month. Over the course of a year, a Northwestern family would spend $1,912.68 more than the Toronto family.

The Canadian government has in place programs designed to address these challenges. Nutrition North Canada (NNC) is designed to reduce the cost of healthy food in remote areas. It has been operational since April 1, 2011 and serves to subsidize several perishable and nutritious food items such as fruit, vegetables, milk, eggs, meat and cheese that have to be shipped by air. It also subsidizes traditional or “country” food that is commercially processed in the North and shipped by air, such as Arctic char, muskox and caribou.

According to Mr. Melillo, the fact that healthy food is much more expensive in Northern Ontario than other parts of the province means the current initiatives are not doing enough to increase food security.

High food basket prices are not exclusive to remote communities. Connected Northern communities, including in the Sudbury and Algoma regions, also face steep costs to eat well. Algoma and Sudbury, each around $900 per month, have the fourth and sixth highest healthy food basket prices, respectively. Hamilton is the lowest health unit of the 20 in the diagram, coming in at roughly $750 per month. Seven of the nine highest-priced communities are in Northern Ontario.

Food insecurity is a complicated issue. There are a number of factors that all contribute to the availability of healthy food or lack thereof in various communities. According to previous research, Mr. Melillo cites inadequate income as being closely linked to food insecurity. Factors such as unemployment also negatively impact the ability of individuals to eat healthy foods.

In Northern Ontario, the average unemployment rate is 9.3 percent, according to Statistics Canada. That is more than one percentage point higher than Toronto, at 8.2 percent, and over two percent more than Hamilton, at 7.0 percent. In the Manitoulin district, the unemployment rate is 13.4 percent as of 2016.

“That is consistent with a couple things. The trend is to see higher unemployment in rural rather than urban centres. In Parry Sound or Sault Ste. Marie, for example, unemployment is lower because there are more jobs per capita in those communities,” says Charles Cirtwill, founding president and CEO of Northern Policy Institute.

“Education levels on Manitoulin have gone up in recent years, but they are still lower than the provincial average. That makes it likelier to see higher unemployment,” he adds. 

Mr. Melillo writes that dependence on social assistance and other government transfers is strongly correlated with food insecurity. Economic dependency ratio (EDR) measures the amount of government transfers per $100 of employment income. This includes child benefits, pensions and employment insurance in addition to social assistance. Almost seven percent of Northern Ontarians received social assistance in 2015, up from the provincial average of 4.9 percent. 

This commentary looks at EDR per couple family and finds that food prices tend to rise directly alongside a region’s EDR. It cautions, though, that it has not found any direct causation between the two. Further study would be required to establish what causality, if any, can be shared across the two.

To examine EDR in Northern communities, the provincial average is set as the baseline to which all other regions are compared. Moosonee, for instance, has a 25.6 percent higher EDR than the provincial average. Algoma’s EDR is 88 percent higher than the provincial average but Manitoulin stands out—the Island has a 161.7 percent higher EDR than the rest of the province. Attawapiskat, by comparison, is nearly 300 percent higher than the Ontario average.

“Government transfers play a big role in the EDR statistics. If there are more seniors on the Island collecting Canada Pension and also a bunch of seasonal workers, that could lead to part of these stats,” says Fern Dominelli, CAO of the Manitoulin-Sudbury District Services Board.

On average, Northern Ontario couple families using social assistance receive $1,359.03 more per year than Toronto families. This increase becomes much less pronounced when considering that families tend to be larger in Northern communities.

“One thing we do know about the Island is there are usually more children in families. There are more seniors and a lot more seasonal work than other places. Those are things that could contribute,” Mr. Dominelli adds.

“EDR is driven by the amount of income you’re receiving from government transfers, whether social security, retirement income, welfare or employment insurance. So when you look at Northern Ontario generally, and Manitoulin specifically, you’re seeing higher and higher ratios of funds from government sources versus employment. On Manitoulin, you’d see a high number of individuals collecting these types of payments, which includes payments from bands,” says Mr. Cirtwill.

The increase in social assistance funding for Northern families does not cover the additional healthy Northern food costs as outlined above. Factors such as lower housing prices and extra subsidies, however, would have a bearing on the results. Housing costs are especially difficult to measure on reserves, according to the commentary, so more study would be needed to fully assess the situation.

It is important to note that in a Manitoulin-Sudbury District Services Board homelessness survey released in September 2018, 53.9 percent of the individuals identifying as homeless in the region are living on Manitoulin Island. In the study, Indigenous people represented 52.2 percent of the adult respondents, despite comprising only 26.3 percent of the total population. 

Mr. Melillo writes that programs in Ontario to help address nutritional concerns are part of its Food Security Strategy. These programs include the Student Nutrition Program, Ontario’s Healthy Kids Strategy and the Urban Aboriginal Healthy Living Program. In Northern Ontario, there exists the Northern Fruit and Vegetable Program that provides children with enough healthy fruits and vegetables. However, the commentary warns, despite the program’s promise it only serves one specific demographic.

Mr. Melillo states that changes in grocery store models may make some impact on food insecurity. Grocery store availability on Manitoulin is also a concern for Mr. Dominelli. 

“There are not a lot of grocery stores. That makes it harder for people to go buy food, especially without transportation. They have no choice but to drive,” says Mr. Dominelli.

Mr. Melillo suggests a possible remedy to grocery unavailability is starting cooperative stores in which community members buy into a store and run it as a collective, rather than a for-profit company. This would likely result in lower prices than profit-driven models. However, he cautions, it would not be an effective solution to food insecurity on its own. 

He also advocates for a basic income guarantee either alongside or instead of social assistance.

“Currently, 70 percent of households on social assistance are food insecure,” writes Mr. Melillo, “which suggests that current social assistance programs are not sufficiently addressing this issue.”

Mr. Melillo notes that Ontario has scrapped its basic income pilot project, with an end date of March 2019. He says this will result in a major loss of information that would have been possible to gather if it had continued.

“Had it been fully completed and analyzed, this pilot project would have provided crucial information on whether and how to proceed with a provincial basic income.”

However, the relationship between income and food insecurity is non-linear, meaning there are likely more factors working to drive the outcomes that exist.

Ultimately, Mr. Melillo writes, this is a complex issue that requires a complex solution.

“Federal and provincial governments could consider adopting more than one approach to address high food costs in Northern Ontario,” he states.

Mr. Cirtwill says communities in the southern part of Northern Ontario such as Manitoulin are starting to see some positive benefits, such as transportation improvements with the twinning of Highway 69 and investments in local agriculture.

“Although there are ups and downs in agriculture on Manitoulin, as a general sense around that region, we are seeing localized agriculture starting to expand. The closer food is to you, the easier it is to get it to the shelf and the cheaper it’s going to be,” says Mr. Cirtwill.

In January 2019, NNC will be revising its subsidized foods list and increasing its subsidies for certain nutritious products. This will be an additional $62.6 million commitment to NNC over five years.