Global Courant
OTTAWA –
The parliamentary budget official says lower-income households have maintained their purchasing power despite high inflation with the help of government benefits.
This is according to a report released on Thursdaythe PBO analyzed how the purchasing power of households at different income levels changed between the last quarters of 2019 and 2022.
The report says all households saw an increase in purchasing power over those three years, with an overall increase of five percent.
That suggests households were able to buy more with their income at the end of last year than before the COVID-19 pandemic hit Canada in early 2020.
This despite an increase in inflation that peaked at 8.1 percent last summer.
But for households in the bottom 20 percent of income, their income was not enough to absorb the rising cost of living.
According to the report, those households depended on government transfers to make up the difference.
“Higher-income households are better able to handle the rising cost of living with their own sources of income,” the PBO said.
The analysis found that COVID-19 benefits depressed incomes at the start of the pandemic and even boosted household purchasing power.
And while inflation rose faster than incomes for some time, households in general still saw their purchasing power increase compared to pre-pandemic levels.
This report from The Canadian Press was first published on June 22, 2023.
