Welfare in Canada

Prince Edward Island

Last updated: December 2021

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

Components of welfare incomes

In Prince Edward Island, households that qualify for basic social assistance payments also qualify for:

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

Together, these 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 2020, these households were also eligible for benefits introduced in response to the COVID-19 pandemic.

The table below shows the value of the welfare income components of the four example household types in Prince Edward Island in 2020. All four households are assumed to be living in Charlottetown. The child in the single parent family is two years old and the children in the couple household are ten and 15. COVID-19 pandemic-related payments are included in the basic social assistance, child benefit, and tax credit/benefits amounts, where applicable.

Components of welfare incomes, 2020

Note: Totals may not add up due to rounding.

✳︎AccessAbility Supports provides persons with a disability with an assured income benefit made up of allowances for food, essentials, and community living, as well as a shelter benefit. AccessAbility Supports recipients can also access other income supports depending on their particular circumstances.

Total annual welfare incomes in 2020 ranged from $12,968 for the unattached single considered employable to $39,961 for the couple with two children. The income of the unattached single with a disability was $14,793 and that of the single parent with one child was $25,256.

Basic social assistance: Three of the example households received benefits through the Social Assistance program; the unattached single with a disability received benefits through AccessAbility Supports.

Monthly basic social assistance benefit amounts increased in January 2020, marking four consecutive years of increases. Increases to the food allowance portion of the basic allowance ranged from 33.5 per cent for the couple with two children to nearly 47 per cent for the unattached single considered employable. Overall, basic social assistance benefits increased by 10 per cent for the unattached single with a disability, 12 per cent for both the unattached single considered employable and the single parent with one child, and 13 per cent for the couple with two children.

All four households also received a Local Transportation allowance of $25 per month as part of their basic social assistance benefits. In addition, all four households received a COVID-19 pandemic-related payment of $100 per family member, including children, in December 2020.

Additional social assistance: On top of basic benefits, the couple with two children received an additional $350 through the School Allowance ($75 for the ten-year-old and $100 for the 15-year-old, issued in both August and December).

Federal child benefits: Both households with children received the Canada Child Benefit (CCB), which increased with inflation in July 2020 from $553.25 to $563.75 per month for a child under six years of age and from $466.83 to $475.67 per month for a child aged six to 17. In addition, they received a one-time COVID-19 pandemic-related CCB top-up payment of $300 per child in May.

Provincial child benefits: Prince Edward Island does not currently have a child benefit program.

Federal tax credits / benefits: All four households received the GST/HST credit, which increased in July 2020 with inflation. The unattached single considered employable and the unattached single with a disability both received $293, the single parent with one child received $586, and the couple with two children received $894. The unattached single with a disability also received $44.49 through the GST/HST credit supplement, while the single parent with one child received the full amount of $154.

A one-time COVID-19 pandemic-related GST/HST credit top-up payment, delivered in April 2020, provided the basic amount of $290 to the unattached single considered employable and the unattached single with a disability. The single parent with one child received $733 and the couple with two children received $886.

Provincial tax credits / benefits: All four households also received the PEI Sales Tax Credit of $110 per year for an individual, plus $55 for a spouse, common-law partner, or eligible dependant.

COVID-19 pandemic-related payments

Pandemic-related payments available to the example Prince Edward Island households came from both federal programs (i.e., the GST/HST credit and Canada Child Benefit) and provincial programs (i.e., the pandemic-related payment for households receiving social assistance), with more provided through federal programs. In total, the unattached single considered employable and the unattached single with a disability received an additional $390 related to the COVID-19 pandemic, while the single parent with one child received $1,233 and the couple with two children received $1,886. These amounts are included in, and are not in addition to, the benefits described in the Components section above.

COVID-19 pandemic-related payments, 2020

Changes to welfare incomes

​The graphs below show how the total welfare incomes for each of the four example household types in Prince Edward Island have changed over time. Note that the values are in 2020 constant dollars, and not in nominal dollars. This 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 unattached single considered employable and the unattached single with a disability saw their welfare incomes drop significantly starting in 1994. The income of the unattached single considered employable stayed relatively stagnant between 1996 and 2017, hovering at around $8,000 over the twenty-year period. The income of the unattached single with a disability fell more gradually until 2003, then remained relatively stagnant at around $10,000 until 2017. Starting in 2017, both increased sharply, with the 2020 income approaching the high point reached in 1992.

Between 2017 and 2020, the welfare income of the unattached single considered employable increased by $4,665, while the welfare income of the unattached single with a disability increased by $4,042. The increase for the unattached single considered employable in 2018 was due to a change in the shelter allowance policy in recognition of PEI’s changing rental market. The 2018 increase for the unattached single with a disability was due to the introduction of an Assured Income through AccessAbility Supports. Incomes rose higher for both household types in 2019 and 2020 as a result of increases to basic social assistance benefits, as well as the addition of provincial and federal COVID-19 pandemic-related payments.

In 2020, the welfare income of the unattached single considered employable was $12,968, and that of the unattached single with a disability was $14,793, both of which were marginally lower than their incomes at the start of the time series (1986 and 1989, respectively).

After declines in the mid-1990s and relative stagnation thereafter, welfare incomes for households with children began to rise in 2006. Changes to federal child benefits between 2015 and 2017 resulted in further increases to the welfare incomes of households with children. Increases in basic social assistance benefits since 2017 and the addition of provincial and federal COVID-19 pandemic-related payments saw welfare incomes reach their highest levels in 2020.

In 2020, the welfare income of the single parent with one child was $25,256, while that of the couple with two children was $39,961.

Adequacy of welfare incomes

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

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

  • Canada’s Official Poverty Line, the Market Basket Measure (MBM), 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, and so those for Charlottetown are used in the analysis below. As well, both the MBM and LIM thresholds are estimates based on increasing the 2019 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 Prince Edward Island 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 Charlottetown.

The welfare incomes of all four example household types in Prince Edward Island were below Canada’s Official Poverty Line in 2020, meaning all these households were living in poverty. Two of the four households were also living in deep poverty in 2020, as defined by the MBM-DIP.

The unattached single considered employable had the lowest income relative to the poverty thresholds. Their income was $3,567 of the deep income poverty threshold and $9,078 below the poverty line. This means their income was 78 per cent of the MBM-DIP and 59 per cent of the MBM.

The unattached single with a disability fared better, with a welfare income that was $1,741 below the deep income poverty threshold and $7,253 below the poverty line. In other words, their income was 89 per cent of the MBM-DIP and 67 per cent of the MBM.

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

The single parent with one child had a welfare income that was above deep income poverty but below the poverty line. Their income was $1,873 above the deep income poverty threshold but $5,921 below the poverty line. This means their income was 108 per cent of the MBM-DIP but 81 per cent of the MBM.

The welfare income of the couple with two children was the highest relative to the poverty thresholds. Their income was $6,893 above the deep income poverty threshold but it remained below the poverty line by $4,130. In other words, their income was 121 per cent of the MBM-DIP and 91 per cent of the MBM.

Low-income threshold comparisons

The welfare incomes of all four households were below the LIM threshold, and those of two households were below the LICO threshold, as shown in the table linked above.

The lowest income relative to these two low-income thresholds was that of the unattached single considered employable, whose total welfare income was 51 per cent of the LIM and 70 per cent of the LICO. The highest was that of the couple with two children, at 79 per cent of the LIM and 115 per cent of the LICO.

The unattached single with a disability had an income that was 58 per cent of the LIM and 80 per cent of the LICO, while the single parent with one child had an income that was 70 per cent of the LIM and 113 per cent of the LICO.

Changes to adequacy of welfare incomes

The graph below shows the total welfare incomes of each of the four example household types in Prince Edward Island since 2002 as a percentage of the MBM, which indicates changes in their level of poverty over time. A rise in the trendline indicates an improvement in their level of poverty while a decline indicates a worsening of their poverty.

Note that the MBM thresholds reflect the base in use in each year in question (i.e., the 2000, 2008, and 2018 bases; the latter two are indicated with vertical lines in each graph). Rebasing creates a sufficiently higher threshold than that using a previous base, which typically results in a worsening of poverty in the year in which the new base is used. As noted above, MBM thresholds vary by province and community size, and so Charlottetown is used. Also note that the 2020 MBM thresholds are estimates. More information is in the methodology section.

The welfare income of the unattached single considered employable increased relative to the poverty line across the time series. Their income remained fairly steady between 2002 and 2017 at about 41 per cent, with a small decline due to the 2008 MBM rebasing. Starting with the 2018 rebasing, however, their income relative to the poverty line improved, moving from 42 per cent in 2017 to 48 per cent in 2018, and reaching a high of 59 per cent of the poverty line in 2020.

The welfare income of the unattached single with a disability also saw an increase relative to the poverty line across the time series, with decline and relative stagnation in between. Their relative income declined between 2002 and 2006, from 64 to 54 per cent. Between 2006 and 2018, their income remained fairly steady at about 54 per cent, with a decline due to the 2008 and 2018 MBM rebasings. 2019 and 2020 saw improvements, with their welfare income reaching a peak of 67 per cent of the poverty line in 2020.

The welfare income of the single parent with one child also saw an increase relative to the poverty line across the time series with significant fluctuations in between, particularly just prior to and with the 2008 and 2018 MBM rebasings. However, the trend was general improvement, from 66 to 72 per cent of the poverty line between 2002 and 2007, from 65 to 78 per cent between 2008 and 2017, and from 69 to 81 per cent between 2018 and 2020, reaching the highest point across the time series.

The welfare income of the couple with two children fared best relative to the poverty line among all four households and followed a very similar trendline to that of the single parent with one child. Their income started the time series at 72 per cent of the poverty line and hovered at around that level until 2014, with a slight drop due to the 2008 MBM rebasing. Subsequent improvements saw their income reach a high in 2017 of 85 per cent of the poverty line, with a decline to 76 per cent accompanying the 2018 MBM rebasing. However, steady increases in the two following years resulted in their welfare income reaching a peak of 91 per cent of the poverty line in 2020.