Legal Aid Eligibility and Coverage in Canada
Section 4 - Data Analyses
In this section, we address the following:
- An analysis of the Legal Aid financial eligibility criteria in relation to Statistics Canada's Low-income cut-off (LICO).
- a) Are the guidelines above or below the LICO?
- b) Does combining the income and assets set the guidelines above or below the LICO?
- c) Do the plans with expanded eligibility have guidelines that are above or below the LICO?
- An examination of how many families are eligible for legal aid, given the legal aid financial eligibility rules
- a) How many families (including single person families) are eligible for legal aid (irrespective of the LICO status)?
- b) What proportion and how many poor families would qualify for legal aid based on the income criteria?
- What does this mean for low-income families?
- What does this mean for low-income young adults, aged 18 to 35 years?
This first segment of the research compares the income amounts of low-income families to the income levels for determining whether a family receives legal aid, utilising information from Statistics Canada. The aim of this section is to analyse just how closely the Legal Aid Plans' (LAP) financial eligibility guidelines, as set forth by the different jurisdictions, match the standard measure for whether a family falls below the LICO, using either before-tax or after-tax measures (as necessary). We have selected the LICO as the main dividing line for determining whether a family is in low-income because it is viewed by many social researchers as a poverty line. Public polling conducted in Canada has given credence to the use of the LICO. Both Gallup and EKOS have conducted polls that provide a guide to what the general public considers to be poverty. One finds that there is an extremely close correspondence between public opinion and the LICO, with both rising over time in line with average income or the standard of living.
It should be noted, however, that Statistics Canada does not consider the LICO levels to be poverty lines. The following is an official statement by Statistics Canada on the use of the LICO:
For many years, Statistics Canada has published a set of measures called the low income cut-offs. We regularly and consistently emphasize that these are quite different from measures of poverty. They reflect a well-defined methodology which identifies those who are substantially worse off than the average. Of course, being significantly worse off than the average does not necessarily mean that one is poor.Nevertheless, in the absence of an accepted definition of poverty, these statistics have been used by many analysts to study the characteristics of the relatively worst off families in Canada.
In the absence of politically-sanctioned social consensus on who should be regarded as "poor," some people and groups have been using the Statistics Canada low-income lines as a de facto definition of poverty. But they certainly do not represent Statistics Canada's views about how poverty should be defined.
The LICO measure distinguishes between those families living in straitened circumstances and those who do not. Families that spend 20% more than the average Canadian family on food, clothing and shelter are considered to be living in straitened circumstances. In essence, it divided the population into those who were poor and those who were not.
This means that, currently, if a family spends more than approximately 55% of their total income on food, clothing and shelter, then they are considered to be living in straitened circumstances and thus are poor. The LICO amounts are not determined for specific cities or family types, rather they vary by size of family and size of urban area. Larger families are allocated higher income levels in recognition of the greater amount of income needed to support more individuals. People living in larger urban areas are also given higher income amounts to control for the expense of living in large urban areas. Furthermore, Statistics Canada reports low-income levels of families before they pay taxes, their gross family income, as well as what the poverty levels are for families after they have paid taxes on this income. Comparisons of the LICO income levels (before and after-tax) with the LAP eligibility income and assets requirements are compared in Table 4. We use the published numbers from Statistics Canada's Income in Canada, 1999 to make these comparisons. To obtain the actual number and proportion of families who would qualify for legal aid (fall within the financial eligibility guidelines), we use data from 1998. This is the most recent publicly available data (see Table 5). So as not to have to deflate the present plans income guidelines to 1998 figures, we simply use the guidelines that were applied in 1998. In order to assess how closely the guidelines match the pre-tax and after-tax LICO levels, we have subtracted the relevant LAP income amount from the LICO amount. Our results show by how much the LAP allowance levels are below or above the relevant before- and after-tax low-income amounts for the different jurisdictions.
The financial eligibility criteria in several jurisdictions also include a maximum amount of liquid assets. Where possible (when it is clearly articulated and there are actual dollar figures), the maximum dollar value of the assets will be summed with the income criteria guidelines for eligibility and assessed against the corresponding LICO figures. We sum the income and the assets to create an "income + assets" category. This is meant to act as a "best guess" as the Survey of Labour and Income Dynamics (SLID) does not allow us to examine assets. We should caution that liquid assets are not equivalent to income. The liquid assets exemptions may play an important role in meeting a need in emergency situations. It is not unreasonable for families to have some modest savings for necessities. The use of the "income + assets" category is only meant to be illustrative; it will not be used in the assessments when examining the proportion of families that would be eligible for legal aid. Several of the jurisdictions, contacted by the researchers, mentioned that they were not overly concerned with assets given the low income levels of their client base (their clients did not have enough money to be saving or investing) .
Some jurisdictions, as mentioned, also allow the applicants to exceed the income guidelines in exchange for some level of contribution. They have established maximum income limits - an absolute limit that the applicant cannot exceed and be eligible for legal aid. These jurisdictions include Alberta, Manitoba and Québec. In Alberta the maximum limits can be waived by a committee with appellate functions. Regional committees and appeals committees both have the authority to expand the limits upon appeal by individual applicants. We include the maximum limits in the analysis to examine how they compare to the LICO.
The analysis will be presented by selected urban centre sizes and family sizes. Either before-and after-tax LICO levels will be used, depending on whether the legal aid plans use gross or net income (as seen in Sections 1 and 3). When calculating the income variables for each of the jurisdictions, we use the income definition they use, that is, either gross or net income. We do not, however, make the deductions. Not all the deductible categories are available on the dataset. By not making these deductions, it allows for comparisons between jurisdictions to be made. Again, we use the corresponding LICO levels.
The presentation of the information in Table 4-1 through Table 4-9 will appear as follows :
- the legal aid plans' family size (or type);
- the equivalent LICO family size;
- the 1998 income guidelines;
- an "income + assets" column if relevant;
- a maximum income contribution range (extended coverage through contribution), if relevant;
- the relevant pre-or-post-tax LICO;
- difference between the guideline and the LICO;
- difference between the "income + assets" category;
- difference between the maximum income contribution range and the LICO.
The second part of the analysis, in Table 5-1 through Table 5-9, examines the proportion and number of families that could qualify for legal aid, given the financial eligibility criteria (the income portion). To calculate these numbers, we use Statistics Canada's Survey of Labour and Income Dynamics (SLID) 1998 public use microdata files.
The units of analysis for these data are families rather than individuals. The research, therefore, provides information regarding the approximate number of families in each jurisdiction that could qualify for legal aid, not individuals. It should be noted that single-person families are included in the analyses.
A separate section entitled "A Look at Young Adults, Aged 18 to 35 years" will examine the proportion and number of young adults who would qualify for legal aid. The methodology is similar to that of the section that examines families. To calculate these numbers, we use Statistics Canada's Survey of Labour and Income Dynamics (SLID) 1998 public use microdata files. In this case, the unit of analysis are individuals between the ages of 18 and 35.
The analyses will include a brief summary of what we found in each province and then a brief comparison of the jurisdictions as a whole will follow the section on youth.
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