A new report released on Monday by non-profit group Social Planning Toronto concludes that poverty costs the city between $4.4 and $5.5 billion a year.
The numbers, based on estimates as “there is no definitive measure of the full economic impact of poverty,” combines what poverty costs Toronto in the justice system, the health system and tax revenues.
“With this report, Toronto leads the way in estimating the cost of poverty for a Canadian city,” the report said. “This estimate is largely comparable, with the exception of intergenerational costs, with estimates of the cost of poverty in Ontario at $32 to $38 billion and for Canada at $72 to $85 billion.”
The estimated poverty costs come as Toronto deals with a 2.6 per cent budget cut for all city departments.
The report shows $730 million is lost annually in health costs due to poverty and $436 million from crime.
“Everyone in a society is better off economically when no one lives in poverty. The effects of a poverty reduction strategy will occur over time, and returns on our investments may take time to come to fruition. That underlines the importance of starting now,” the report stated.
A study earlier this month found that Toronto holds the unenviable spot of having the highest percentage of children living in low-income families among major cities in Canada.
A 2016 Toronto Vital Signs Report released this year, which offers a snapshot of key quality of life trends in the city, also painted a bleak picture for child poverty by labeling it a “hidden epidemic.”
Canadian studies estimate that 20 to 25 per cent of children who grow up in poverty and are likely to remain poor.
There are about 144,000 children in Toronto living in poverty and that means between 28,800 and 36,000 children will likely not escape it as adults, the report said.