• Components of welfare incomes
• Changes to welfare incomes
• Adequacy of welfare incomes
• Changes to adequacy of welfare incomes

Last updated: November 2022

This resource is not intended to help individuals identify what government transfers they could be entitled to. Individuals living in Newfoundland and Labrador seeking financial assistance should visit this page.

In Newfoundland and Labrador, households that qualify for basic social assistance payments also qualify for:

• Recurring additional social assistance payments from the province;
• Federal and provincial child benefits (for households with children); and
• Federal and provincial tax credits or benefits.

Together, these components combine to form a household’s total welfare income. Households may receive less if they have income from other sources, or more if they have special health- or disability-related needs. In 2021, one example household — the single parent with one child — was also eligible for payments related to the continuing COVID-19 pandemic.

The table below shows the value of the welfare income components of the four example household types in Newfoundland and Labrador in 2021. All four households are assumed to be living in St. John’s. The child in the single parent household is two years old and the children in the couple household are ten and 15. COVID-19 pandemic-related payments are included where applicable in the table below.

Components of welfare incomes, 2021

Note: Totals may not add up due to rounding.

Total annual welfare incomes in 2021 ranged from $11,390 for the unattached single considered employable to $29,971 for the couple with two children. The income of the unattached single with a disability was $18,226 and that of the single parent with one child was $25,044.

Basic social assistance: Monthly basic social assistance benefit amounts remained unchanged in 2021.

Additional social assistance: All four households received additional benefits. The unattached single considered employable, the single parent with one child, and the couple with two children received $1,800 ($150 per month) through the Supplemental Shelter Benefit. This amount remained unchanged in 2021.

The unattached single with a disability received $1,800 ($150 per month) through the Personal Care Allowance, paid by the Department of Health and Community Services (HCS) to social assistance clients receiving supportive services. This amount remained unchanged in 2021. In addition, the unattached single with a disability received top-ups from HCS of $6,000 for rent and $1,320 for utilities. Note that these amounts are rounded averages of top-ups provided to recipients in these household types, and that this data was provided by HCS.

Federal child benefits: Both households with children received the Canada Child Benefit (CCB), which increased with inflation in July 2021 from $563.75 to $569.42 per month for a child under six years of age and from $475.66 to $480.41 per month for a child aged six to 17. In addition, the single parent of one child aged two received the COVID-19 pandemic-related CCB Young Child Supplement, given to CCB-eligible families with children under the age of six, of $300 per child in January, April, July, and October.

Provincial child benefits: Both households with children received the Newfoundland and Labrador Child Benefit. In July 2021, this monthly payment increased from $34.08 to $34.17 for the first child, and from $36.17 to $36.33 for the second child.

Federal tax credits / benefits: All four households received the GST/HST credit, which increased in July 2021 with inflation. The unattached single considered employable and the unattached single with a disability received $297.50 in basic GST/HST credit, while the single parent with one child received $595 and the couple with two children received $907. Three households also received the GST/HST credit supplement. The unattached single considered employable received $24.20, the unattached single with a disability received $91.08 and the single parent with one child received the maximum amount of $156.

Provincial tax credits / benefits: All four households also received the Newfoundland and Labrador Income Supplement. The unattached single considered employable received $220, the unattached single with a disability received $521, the single parent with one child received $440, and the couple with two children received $727. These amounts remained unchanged in 2021.

COVID-19 pandemic-related payments

The only pandemic-related payment available to the example Newfoundland and Labrador households in 2021 was received by the single parent of one child aged two, which came from the federal Canada Child Benefit Young Child Supplement of $300 per child, paid in January, April, July, and October. This amount is included in, and is not in addition to, the benefits described in the Components section above.

COVID-19 pandemic-related payments, 2021

Changes to welfare incomes

The graphs below show how the total welfare incomes for each of the four example household types in Newfoundland and Labrador have changed over time. Note that the values are in 2021 constant dollars, not in nominal dollars. Using constant dollars takes into account the effect of inflation, as measured by the national Consumer Price Index, given that inflation reduces real dollar values over time.

The welfare income of the unattached single considered employable was very low through the first half of the time series, with a massive decline in the late 1990s that resulted from a policy change that gave recipients very low room and board allowances instead of market rent shelter benefits. The welfare income of the unattached single with a disability declined gradually from the start of the time series until 2012, when the two welfare income values converged.

The 2012 convergence resulted from the elimination of supplemental shelter benefits in the income calculations for the unattached single with a disability. Between that point and 2019, the Fuel Supplement was included in the calculations of the income of the unattached single with a disability as a proxy for shelter and utilities top-ups provided by the Department of Health and Community Services (HCS).

The large increase in the 2020 income of the unattached single with a disability resulted primarily from the inclusion of rounded average amounts for the shelter and utilities top-ups provided by HCS. The inclusion of these amounts better reflects the actual policy regime in Newfoundland and Labrador. The total welfare income of both households also increased in 2020 due to the addition of COVID-19 pandemic-related benefits.

The declines in 2021 resulted primarily from the loss of pandemic-related payments, as well as the impact of inflation on unchanged social assistance benefit amounts. Note that while the welfare income of the unattached single with a disability was nominally the same in 2021 as in 2020, the effect of inflation resulted in a decrease in constant value.

In 2021, the total welfare income of the unattached single considered employable was $11,390, while that of the unattached single with a disability was $18,226.

Welfare incomes for households with children have gradually increased over time, with larger increases in 2006, between 2015 and 2017, and in 2020, which marked the highest level across the time series.

The 2006 increases resulted from an increase to the Family Benefit rate. The rise in 2015 to 2017 was largely the result of changes to federal child benefits. The increases in 2020 were due to federal COVID-19 pandemic-related payments. The decrease in 2021 was primarily due to the loss of most of the value of COVID-related payments, as well as to the impact of inflation on unchanged social assistance benefit amounts. Note that while the welfare income of the single parent with one child was nominally higher in 2021 than in 2020, the effect of inflation resulted in a decrease in real value.

In 2021, the welfare income of the single parent with one child was $25,044, while that of the couple with two children was $29,971.

Adequacy of welfare incomes

The adequacy of a household’s total welfare income can be assessed by comparing it to established thresholds of poverty and/or low income.

In Canada, there are two commonly used measures of poverty:

• The Market Basket Measure (MBM), Canada’s Official Poverty Line, identifies households whose disposable income is less than the cost of a “basket” of goods and services that represent a basic standard of living.
• Deep Income Poverty (MBM-DIP) identifies households whose disposable income is less than 75 per cent of the MBM.

There are also two commonly used measures of low income:

• The Low Income Measure (LIM) identifies households whose income is substantially below what is typical in society (less than half of the median income).
• The Low Income Cut-Off (LICO) identifies households that are likely to spend a disproportionately large share of their income on the necessities of food, clothing, and shelter.

Note that MBM thresholds vary by province and community size, and LICO thresholds vary by community size, so those for St. John’s are used in the analysis below. As well, both the MBM and LIM thresholds in 2021 are estimates based on increasing the 2020 thresholds to account for inflation.

Note also that none of the poverty or low-income measures currently in use in Canada account for the higher cost of living faced by persons with disabilities and thus these additional costs are not reflected in our analysis.

More information about the thresholds is available in the methodology section.

A table containing comparisons of the welfare incomes of the four example household types in Newfoundland and Labrador with all four poverty / low-income thresholds is available for download.

Poverty threshold comparisons

The figures below compare welfare incomes for the four example household types to the MBM and MBM-DIP thresholds for St. John’s.

The welfare incomes of all four example household types in Newfoundland and Labrador were below, and in some cases far below, Canada’s Official Poverty Line in 2021, which means that all four households were living in poverty. Two of the four households were also living in deep poverty in 2021, as defined by the MBM-DIP.​

The unattached single considered employable had the lowest income relative to the poverty thresholds. Their income was $6,262 below the deep income poverty threshold and $12,145 below the poverty line. In other words, their income was only 65 per cent of the MBM-DIP and only 48 per cent of the MBM.

The unattached single with a disability fared best of all four example households relative to the poverty thresholds. Their income was $574 above the deep income poverty threshold, but it remained below the poverty line by $5,309. This means their income was 103 per cent of the MBM-DIP but 77 per cent of the MBM.

Note that the poverty experienced by persons with disabilities is under-represented, because neither the MBM nor the MBM-DIP account for the additional costs associated with disability.

The single parent with one child had a welfare income $82 above the deep income poverty threshold, but below the poverty line by $8,239. In other words, their income was 100 per cent of the MBM-DIP but 75 per cent of MBM.

The welfare income of the couple with two children was $5,331 below the deep income poverty threshold and $17,099 below the poverty line. This means their income was 85 per cent of the MBM-DIP and 64 per cent of the MBM.

Low-income threshold comparisons

The welfare incomes of these households were also below, and in some instances far below, the low-income thresholds, as shown in the table linked above.

The lowest income relative to these thresholds was that of the unattached single considered employable, whose total welfare income was 41 per cent of the LIM and 59 per cent of the LICO thresholds. The highest income relative to the LIM was that of the unattached single with a disability, at 66 per cent, while their income relative to the LICO was 95 per cent. The highest income relative to the LICO was that of the single parent with one child, at 107 per cent, while their income relative to the LIM was 64 per cent. The income of the couple with two children was 55 per cent of the LIM and 82 per cent of the LICO.

Changes to adequacy of welfare incomes

The graphs below show the total welfare incomes of each of the four example household types in Newfoundland and Labrador as a percentage of the Market Basket Measure (MBM), starting in 2002. The MBM has been updated twice since its creation in 2000, first in 2008 and again in 2018. This “rebasing” updates the measure, including the items and costs included in the basket, to better reflect contemporary circumstances.

Three trendlines for each household are shown, which correspond to the relationship between welfare incomes and the original and rebased MBMs. Rebasing typically creates a higher poverty threshold than that of a previous base.

The 100 per cent threshold at the top of the vertical axis represents Canada’s Official Poverty Line. As such, the graphs essentially show how far below the poverty line the households have been in terms of their total welfare income over the past 20 years. The trendlines indicate changes in the level of poverty of the households within the years in which the bases are applied. A rise in the trendline within those periods indicates an improvement in their level of poverty while a decline indicates a worsening of the depth of their poverty.

A grey line has also been included that indicates the deep income poverty threshold, which is 75 per cent of the MBM. As such, the graphs also show the relationship between total welfare incomes over time and deep poverty.

Note that MBM thresholds vary by province and community size, and so St. John’s is used. Also note that the 2021 MBM thresholds are estimates based on increasing the 2020 thresholds to account for inflation. More information is in the methodology section.

The welfare income of the unattached single considered employable started the time series in 2002 at 62 per cent of the poverty line, increasing with some fluctuations to 63 per cent in 2008. After rebasing, their income was at 57 per cent of the poverty line. Over the following ten years, their relative income increased only slightly, to 59 per cent of the poverty line in 2018. After 2018’s rebasing, their income was at 51 per cent of the poverty line, staying virtually the same through 2020 and then declining to 48 per cent in 2021, which is the lowest relative level across the entire time series.

Overall, the welfare income of the unattached single considered employable was fourteen percentage points lower relative to the poverty line in 2021 than it was in 2002, which represents a significant worsening of their depth of poverty over the time series. As well, their income was below the deep income poverty threshold across the entire time series, meaning they would have been living in deep poverty over the last twenty years.

The welfare income of the unattached single with a disability started the time series from the higher level of 74 per cent of the poverty line in 2002. With some fluctuations in the intervening years, it was at 74 per cent again in 2008. After rebasing, their income was at 67 per cent of the poverty line, after which it remained stable until 2010, falling to 60 per cent in 2011 and for the following seven years. After the 2018 rebasing, their income was at 52 per cent of the poverty line, where it remained almost the same for one year, then increased significantly in 2020 to 80 per cent of the poverty line, which was due to a methodology change used in this report (see the “Changes to welfare incomes” section above). The end of the time series in 2021 saw their relative welfare income at 77 per cent of the poverty line.

Overall, the relative welfare income of the unattached single with a disability was slightly higher in 2021, at 77 per cent of the poverty line, than it was in 2002, at 74 per cent. This represents a very modest improvement in this household’s depth of poverty. In addition, their income was below the deep income poverty threshold for the vast majority of the years in the time series, only getting slightly above deep income poverty in 2020 and 2021. As such, they would have spent the majority of the past 20 years living in deep poverty.

The welfare income of the single parent with one child started the time series at 85 per cent of the poverty line, increasing to 91 per cent in 2007 and 90 per cent in 2008. After rebasing, their income was 82 per cent of the poverty line, where it remained relatively unchanged for the next six years. Starting in 2015 their income increased, ending at 86 per cent of the poverty line in 2018. After rebasing their income was 74 per cent of the poverty line, after which it remained stable for one year, increasing to 77 per cent in 2020 and ending the time series at 75 per cent of the poverty line in 2021.

Overall, the relative welfare income of the single parent with one child was ten percentage points lower in 2021 than it was in 2002, which represents a significant worsening of the depth of their poverty over the time series. Their income was, however, above the deep income poverty threshold for most of the time series, only falling below and hovering around that threshold over the past four years.

The welfare income of the couple with two children followed a similar trendline to that of the single parent with one child, although it began at the lower level of 71 per cent of the poverty line in 2002, rising to 74 per cent in 2007 and 2008. After rebasing, their income was 67 per cent of the poverty line, where it remained with some fluctuations until 2014. Increases starting in 2015 were followed by a high of 76 per cent of the poverty line in 2017 and 2018. After 2018’s rebasing, their income was 65 per cent of the poverty line. An increase to 69 per cent in 2020 was followed by a steep decrease to 64 per cent of the poverty line in 2021.

Overall, the relative welfare income of the couple with two children was seven percentage points lower in 2021 than it was in 2002, which represents a slight worsening of the depth of their poverty across the time series. In addition, as their income was only above the deep income poverty threshold for one year, they would have spent the vast majority of the past 20 years living in deep poverty.