On March 28, P.E.I.’s government announced that the annual income thresholds would increase to match “market basket measure” (MBM), a move it hopes will “more fairly represent the economic landscape and improve access to justice across the Island.”
The increases took hold on April 1.
A government spokesperson confirmed that a single islander earning $22,252.50 or less annually will now be eligible, up from the previous $17,632; a family of three bringing in $38,542.46 or less will now be eligible, up from $30,072; and for a family of five, the threshold is now $49,758.10, up from $38,823.
Additional details on the new thresholds, which range all the way up to a family of nine, can be found here.
“The changes … are a result of a review of the guidelines to better identify financial thresholds for Legal Aid moving forward,” the announcement states. “Using the MBM allows Legal Aid on PEI to become better aligned with other jurisdictions across Canada when measuring financial means and eligibility.”
According to information from P.E.I. Legal Aid, MBM is based on after-tax earnings calculations predicting the amount of disposable income needed for a family of four to maintain “a modest but reasonable standard of living.” It considers the cost of living in different jurisdictions, examines everyday needs such as clothing, food, shelter and transportation, and is “regularly revised to reflect inflation at the local rate.”
The release also notes that legal aid will continue to have wiggle room in determining eligibility on a case-by-case basis by using a “flexible means test” and that it has “discretionary approval” in instances where a “strict application of guidelines would cause undue hardship.” In such cases, a “broader set of factors” is used in determining eligibility.
“By increasing the threshold amounts to reflect an increase in the cost of living, PEI Legal Aid will be accessible to more people in need,” said acting director Thane MacEachern in an email to Law360 Canada. “By using a resource-based allocation such as the MBM, opposed to an income-based measure such as minimum wage or Statistic Canada’s Low Income Cut Off, PEI Legal Aid income thresholds will better reflect the reality of individuals and families’ financial situations that are not likely to allow for legal fees.”
MacEachern said the MBM “takes into account the actual available cash flow for a family, local inflation and … is specific to economic community.”
Bloyce Thompson, P.E.I. deputy premier and minister of justice and public safety, said it comes down to “proper representation.”
“We are committed to continuing to improve access to justice across this Island, and Legal Aid is one of our more important mechanisms to do that,” said Thompson in a statement. “I want to thank our Legal Aid team for their commitment to proper representation and for assisting in making our justice system the best it can be.”
The threshold increases come as P.E.I., along with the rest of the country, continues to struggle with high inflation, spiking food prices and a lack of affordable housing.
According to Statistics Canada, the prevalence of low income on P.E.I. in 2021 — based on the after-tax “low-income measure” — was almost 14 per cent.
Last month, local news reported that the provincial government’s 2024 budget includes greater supports for low-income families, such as an enhanced child benefit for parents and vision care for eligible children.
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