IAF Invited to Appear Before the House of Commons’ Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities
Immigrant Access Fund has been invited to appear before the House of Commons’ Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities as part of its study of poverty reduction strategies. Below is the full statement delivered by Vanessa Desa, Vice-Chair, with Dianne Fehr, Vice President, in Medicine Hat on February 17, 2017.
Presentation to the House of Commons’ Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities
Thank you for this opportunity to present on education, training and employment strategies to reduce poverty in Canada. It is a privilege to be able to share our experience and our insights.
I’d like to begin with a story of poverty, survival, resilience and transformation.
Abdul Ali came to Canada full of dreams for a brighter and safer future for himself and his family. He believed that his Master’s degree in accounting, flawless English and years of experience in senior management positions at a multinational oil company would serve him well. After sending out hundreds of job applications without success and using up his savings to settle his family, Abdul did what so many immigrants to Canada are forced to do – he took a minimum wage survival job as a clerk at a convenience store to put food on the table for his family of four.
Abdul’s story is a common one. Despite the fact that Canada actively recruits skilled immigrants for the contributions that they and their families can make to our economy and future, we have not created the conditions that allow them to thrive. Despite their average higher levels of education, they face higher unemployment rates and lower wages than Canadian born workers, and are disproportionally represented in Canadian poverty statistics.
1. 2006 Census Data – 22% of racialized persons living in Canada live in poverty compared to 9%for those from non-racialized communities. (Most recent immigrants to Canada are members of racialized communities)
2. In large metropolitan areas the numbers are much worse:
- Vancouver – 58% of Canadians living below the poverty line come from racialized groups
- Toronto – Individuals from racialized groups account for 62% of those living in poverty
3. 41% of chronically poor immigrants have university degrees
You have met them. They are the taxi drivers who drive you to airports, the clerks in grocery stores, and the cleaners and security guards in office towers across Canada.
This is preventable poverty, devastating to the families who experience it who arrive on our shores expecting so much more, and a huge loss to Canada’s economy and all of us as Canadians. It is estimated that if immigrants’ observable skills were rewarded in a manner similar to Canadian born workers, the increase in incomes would amount to $30.7 billion, or about 2.1 % of GDP1
It is imperative that the Government of Canada provide leadership in redressing this situation.
So why does it happen? There are several complex and mostly systemic reasons:
1. The lack of recognition and acceptance of immigrants’ international credentials. After four years of landing in Canada, only 28% of newcomers with international credentials are able to get them recognized
2. The demands of many employers for Canadian work experience as a pre-requisite for employment creates a hurdle that is almost impossible to overcome
3. Immigrants are excluded from the social and informational networks that often lead to employment
4. Immigrants lack access to the financial resources to pursue the licensing, training and bridging programs that would help them to overcome these systemic barriers
What is Immigrant Access Fund and how do we fit into this picture?
Immigrant Access Fund is one of those social innovations made possible when governments, communities and the private sector come together to make a difference. IAF is a unique character based micro loan program that lends up to $10,000 to immigrants across Canada to enable them to return to work in the occupations that they trained for and worked in prior to their arrival.
Immigrants can use our funds for whatever will help them on this challenging “get out of poverty” journey. Since our start in 2005, we have lent over $17 million to 2,700 newcomers.
What Makes Us Unique?
- Pay back rate on our loans is over 97%
- The majority of the almost $10 million in IAF’s loan capital pool comes from the private sector through an innovative social finance model that leverages the assets of foundations and high net worth individuals.
- Based on a study by University of Calgary Economist Dr. Herb Emery, the return on public sector funds invested in the Immigrant Access Fund is 900%2
What difference does IAF make in reducing poverty?
- At the time they apply to us, 42% of IAF applicants are unemployed and 58% are in survival jobs. After completing their licensing plan, 81% report being employed in their field.
- IAF borrowers go from earning $16,000/year on average to earning $50,000/year. This results in an increase in taxes paid to federal and provincial coffers of $6,500 in the first year alone.
So what are our recommendations to you?
1. Continue to address the systemic barriers in licensing and credential recognition processes. Good progress has been made through the Pan–Canadian Framework for the Assessment and Recognition of Foreign Qualifications developed under the auspices of the Forum of Labour Market Ministers. The framework commits governments, licensing bodies and other stakeholders to work together to increase the fairness, transparency, timeliness, and consistency of foreign qualification assessment and recognition processes. Given the impact that recognizing international credentials has on reducing poverty and preventing people from falling into poverty, greater priority needs to be given to this area, and measurements of success built into the Framework and Action Plan.
2. Recognize the role that mentoring and bridging programs can play in reducing poverty. These programs support immigrants to overcome the barriers of “no Canadian experience” and help to connect them to social and informational networks that lead to employment in their field.
3. Ensure that the policies and practices of regulatory bodies, governments and other stakeholders are aligned to support the various stages of the labour market integration journey faced by immigrants. Too often we have seen our loan applicants take one step forward to then find themselves pushed three steps back by counterproductive policies or practices.
4. Create an environment that inspires, supports, and rewards social innovation and social finance. IAF is an example of what can be achieved when governments, the private sector and communities come together to align common interests to tackle the social challenge of reducing poverty.
So we started with Abdul and I would like to go back to him. I promised you a transformational story and his is truly that. Abdul borrowed $3,200 from IAF to begin the process of getting his accounting designation in Canada. By the time he had completed 2 courses, he was hired by a company in Calgary with a starting wage of $40/hour. But it is Abdul’s profound words that stay with us until today. “When I came home with that first pay cheque that reflected my years of education and experience and the dreams and hopes that had brought me to Canada—a pay cheque that meant my family’s struggles with poverty were over—my wife and my children cried.”