RU R A L D E V E LO PM E N T I N S T I T U T E K N OW L E D G E B R I E F FA L L 2016

KNOWLEDGE BRIEF

Poverty Reduction Part II:
Using Indicators to Support Poverty Reduction

INTRODUCTION
WHY ARE INDICATORS IMPORTANT?
Poverty reduction efforts are increasingly reliant on the
use of indicators to measure the complex dimensions of
poverty and evaluate the results of actions taken. The use
of indicators is explained in part by the growing need to
make a compelling case to policy-makers, funders, and
other investors, as well as to demonstrate accountability
for the effective use of funds invested in social initiatives.1
Additionally, poverty reduction advocates highlight a
number of other reasons to measure poverty, such as
raising awareness and maintaining focus on the issue,
dispelling myths about poverty and its origins, and
informing communities about relevant trends to support
actions that are targeted and appropriate.2,3
Though the term “indicator” is used widely, as are
“measurement” or “metric”, it can be used to refer to
multiple different, but related ways to track variables:
monitoring particular social or economic conditions;
identifying trends within a population; setting targets
or goals for specific programs or policies or evaluating
their success; or establishing benchmarks for comparison
with other communities. See Poverty Reduction Part III:
Identifying Key Indicators for Poverty Reduction for
a more detailed discussion about the different scale and
focus of indicators.

MODELS & FRAMEWORKS FOR
USING INDICATORS TO MEASURE
POVERTY REDUCTION
Many communities and agencies are drawing on
established frameworks to support incorporating
indicators into their poverty reduction efforts. One such
example is the Social Return on Investment (SROI)
model, which is used to measure value in a broader sense,
beyond purely financial terms, using monetary values to
represent social, environmental, or economic outcomes.4
An SROI calculation gives a community or agency the
ability to reflect the costs (e.g., investment in a social
program) as a ratio of the benefits (e.g., the social value
of the program). When the ratio shows an outcome value
higher than investment value it supports the case for the
positive impact of an initiative. As an example, the Region
of Waterloo used SROI to calculate the potential benefits
of a regional living wage policy, finding that the total
social value of the policy would be $1.80 for every dollar
invested.⁵
Like the SROI, the Genuine Progress Indicators (GPI)
approach looks at a broad range of economic, social, and
environmental indicators, and represents their total value,
using monetary figures.6
The strength of this approach is its ability to bring together
diverse indicators into a single, aggregate measure that
can be used to compare overall well-being in different
regions. Although the GPI approach was designed
primarily for large-scale use (e.g., at the national level),

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recently interest has turned to ways the GPI may be
applied at the local level,⁷ with examples of local level
GPI assessments completed in Edmonton and Atlantic
Canada.8,9 One challenge of the approach is that it
requires access to a large number of indicators across
many dimensions of community well-being and this data
may not be available for rural communities.10,11 However,
it may still be of value for communities including
poverty reduction as a component in a comprehensive
community planning process.
The Vibrant Communities Canada: Cities Reducing
Poverty approach is increasingly popular, with dozens
of Canadian municipalities now participating in the
collective impact movement.12 Shared measurement, or
the use of consistent indicators across partners, is one
of the essential tenets of the collective impact model,
highlighting the importance of measuring progress
against reliable benchmarks and communicating these
results regularly to the community.13 Additionally, Vibrant
Communities draws many of its principles from the
Developmental Evaluation approach. Developmental
evaluation recognizes that social initiatives are continually
developing and adapting to unpredictable social
conditions, and relies on a continuous and simultaneous
process of planning, action, and evaluation to support
innovative thinking in complex, shifting contexts.14,15
The Health Equity approach taken by the Saskatoon
Health Region (SHR) has attracted attention as one of
the top inspirational approaches to poverty reduction
in Canada.16 A ground-breaking study, released in 2008,
described the extent of disparity in health outcomes
by socio-economic status in the Saskatoon community,
which was in some cases shocking in its magnitude for
a city in the western world.17 The report also identified
evidence-based policy options to prevent health
disparities, resulting in a new approach by the SHR in
which “health equity became both a tool to build programs
and a means to measure program outcomes.” 18 New
research is available to support a health equity approach
to poverty reduction in other communities. The Canadian
Institute for Health Information (CIHI) recently released
a detailed report that examines trends in 16 health
indicators over time and across five income levels,19
and provides an interactive e-tool that allows users to
explore these trends at the provincial level.20 Within
British Columbia, the Provincial Health Services Authority
recently released an updated analysis of 52 priority
health equity indicators, which in most cases includes a
breakdown by Local Health Area (LHA) or Health Service
Delivery Area (HSDA).21
The Sustainable Livelihoods Framework uses assetmapping as a measurement tool, identifying individual or
community assets in five categories (i.e., financial, social,

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personal, physical, and human), determining a baseline,
and regularly reassessing identified assets for change
relative to the baseline over the length of a program.22
The Sustainable Livelihoods model was applied by
Thunder Bay’s PARO Centre for Women’s Enterprise, a
not-for-profit organization that provides multi-faceted,
holistic programming focused on enhancing the
economic independence of women and their families
across Northwestern Ontario. The Canadian Community
Economic Development Network’s (CCEDNet) PlaceBased Poverty Reduction (PBPR) initiative studied the
effectiveness of PARO’s approach to measurement,
finding that in addition to demonstrating that all research
participants had increases in all asset categories, the
approach also gave the participants a quantifiable way of
assessing changes in their own lives.23

CRITERIA FOR SELECTING INDICATORS
Given the importance of integrating indicators into
poverty reduction efforts, communities and agencies
need to give attention to selecting appropriate indicators.
Many may choose to follow an existing framework, like
those detailed above, to structure their approach to
defining indicators. However, the specific needs of each
community are also important considerations. A research
study conducted with rural women living in poverty in
Ontario’s Grey, Bruce, and Huron Counties developed a
Community Report Card approach that emphasized the
importance of defining the information needs of the
community. The toolkit recommends asking questions
such as: “What information would influence new and more
positive attitudes in the community? What information
would help the community develop strategies for change?...
What information would help to engage people and support
action?... What do we have to do to ensure that we involve
the full diversity of our community in the information
gathering process?”24
The literature suggests that combining poverty indicators
can improve the validity of results when evaluating
programs.25 A recent survey of approaches to measuring
poverty highlighted that while most approaches
incorporated income measures, none used income as
the sole measure.26 Other important similarities across
these approaches include measurement of multiple
indicators across a number of dimensions of poverty;
a combination of local data collection and national
statistics; community specific measures relevant to
unique programs; and measurement of change from the
perspective of the community and individuals living in
poverty.27 The Canadian Centre for Policy Alternatives
argues that a comprehensive poverty reduction plan
for British Columbia must include carefully selected
indicators, suggesting: “No one measure/indicator is
enough to establish and monitor a comprehensive poverty

reduction plan. An effective plan must track the breadth,
depth and duration of poverty; it must have indicators that
focus on those populations where poverty is most acute and
persistent; and it requires multiple indicators of hardship and
financial stress (covering homelessness, housing insecurity,
food insecurity, etc.)."28
For the Region of Waterloo, the following criteria were
used to select indicators to monitor their comprehensive
approach to poverty reduction: “relevancy to poverty;
how measurable the indicator; whether the indicator
was evidence-based; whether the data and data source
were reliable; whether the indicator was statistically
sound; whether the data were available in a timely
manner; whether a provincial and national comparator
was available; and whether the data were accessible at
the Regional level.”29 Similarly, the Saskatoon Poverty
Reduction Partnership defined their indicator selection
criteria as follows: “that reporting will occur at least
annually; that indicators relate to the theme areas we're
monitoring and evaluating; and that they are crucial to the
well-being of the community.”30

LIMITATIONS & CHALLENGES
One concern with the increasing reliance on indicators
is the risk of selecting false or misleading measures. A
prime example of a misleading indicator is a reduction
in the number of individuals receiving income assistance
because the indicator does not track the reasons people
may be leaving or denied access. It also does not measure
whether or not those individuals remain poor.31 Food
bank usage is another such example, often used as
an indicator of food security levels in a community.
Yet, research shows that food bank usage reflects only
a subset of the food insecure population and is not
representative of the food insecure population.32,33
Additionally, there is a concern that the use of indicators
may negatively impact the way programs are selected,
favouring programs that have easily quantifiable
outcomes.34
Particularly in rural communities, the availability of locallevel data and resources for data collection may pose
serious concerns and challenges. The time and expense
of collecting data may draw resources away from time
spent on direct poverty reduction work. One participating
organization in the CCEDNet PBPR initiative observed that
embedding data collection procedures in programs can
make quantitative measurement “relatively painless”, yet
this did not address the concern that pre-intervention
indicators were absent, making it challenging to establish
appropriate baselines.35 However, recent research
examines twenty promising efforts to develop shared
approaches to measuring outcomes in the non-profit
sector, such as new technologically enabled shared
measurement platforms, arguing that these innovative

collaborations may create significant changes in
effectiveness for the entire sector.36

REFERENCES & RESOURCES
1.

Paul Chamberlain, “Place-Based Poverty Reduction
Initiative: How Community Economic Development Is
Reducing Poverty in Canada and How It Could Be Doing
More” (Victoria, BC: The Canadian CED Network, 2008).

2.

Region of Waterloo Social Services, “Poverty Indicators in
Waterloo Region: Status Report 2014” (Waterloo, ON: Social
Planning, Policy and Program Administration, Region of
Waterloo Social Services, 2014), http://communityservices.
regionofwaterloo.ca/en/communityPlanningPartnerships/
resources/PovertyIndicatorsinWaterlooRegion.pdf.

3.

Colleen Purdon, “Counting Women In: A Toolkit for Rural
Action on Poverty” (Rural Women Take Action on Poverty
Committee, June 2009), http://vibrantcanada.ca/files/
counting_women_in_toolkit_final.pdf.

4.

Tim Goodspeed et al., “A Guide to Social Return on
Investment” (London: New Economics Foundation, 2009),
http://www.neweconomics.org/sites/neweconomics.org/
files/A_guide_to_Social_Return_on_Investment_1.pdf.

5.

SiMPACT Strategy Group, “Social Return on Investment
(SROI): A Living Wage Policy for the Regional Municipality
of Waterloo” (Waterloo, ON: Region of Waterloo Social
Planning, Policy and Program Administration, 2009),
http://communityservices.regionofwaterloo.ca/en/
communityPlanningPartnerships/resources/DOCS_ADMIN726143-v2-FINAL_LIVING_WAGE_SROI_CASE_STUDY_.
pdf#Final Living Wage SROI Case Study.

6.

Kenneth Bagstad and Marta Ceroni, “Opportunities and
Challenges in Applying the Genuine Progress Indicator/
Index of Sustainable Economic Welfare at Local Scales,”
International Journal of Environment, Workplace and
Employment 3, no. 2 (2007): 132–53.

7.

Jeffrey Wilson and Peter Tyedmers, “Rethinking What
Counts. Perspectives on Wellbeing and Genuine Progress
Indicator Metrics from a Canadian Viewpoint,” Sustainability
5, no. 1 (January 14, 2013): 187–202.

8.

Mark Anielski and Heather Johannessen, “The Edmonton
2008 Genuine Progress Indicator Report: The State of
Economic, Social and Environmental Wellbeing for the City
of Edmonton” (Edmonton, AB: Anielski Management Inc.,
November 11, 2009), http://www.anielski.com/wp-content/
docuploads/Edmonton%20GPI%202009%20Report.pdf.

9.

GPIAtlantic, “Community GPI,” GPIAtlantic: Genuine
Progress Indicators for Atlantic Canada, 2014, http://www.
gpiatlantic.org/community.htm.

10.

Wilson and Tyedmers, 2013.

11.

Bagstad and Ceroni, 2007.

12.

Brock Carlton and Paul Born, “10 - A Guide to Cities
Reducing Poverty” (Tamarack Institute, 2016).

KNOWLEDGE BRIEF

U S I N G I N D I C ATO R S TO S U P P O R T P OV E R T Y R E D U C T I O N

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REFERENCES & RESOURCES CONTINUED
13.

14.

15.

Brian Reid, Mark Cabaj, and Louise Kearney, “Convening
a Comprehensive, Multi-Sector Effort to Reduce Poverty:
A Primer 2nd Edition” (Waterloo, ON: Tamarack Institute,
2013), http://www.tamarackcommunity.ca/library/
convening-a-comprehensive-multi-sector-effort-toreduce-poverty.
Jamie A.A. Gamble, “A Developmental Evaluation Primer”
(Montreal, QC: The J. W. McConnell Family Foundation,
2008), http://tamarackcci.ca/files/developmental_
evaluation_primer.pdf.
Liz Weaver, Paul Born, and Denise Whaley, “Approaches
to Measuring: Community Change Indicators”
(Waterloo, ON: Tamarack Institute, 2010), http://www.
tamarackcommunity.ca/library/approaches-to-measuringcommunity-change-indicators.

22.

Weaver, Born, and Whaley, 2010.

23.

Chamberlain, 2008.

24.

Purdon, 2009. p.33-34

25.

Geranda Notten, “How Poverty Indicators Confound
Poverty Reduction Evaluations: The Targeting
Performance of Income Transfers in Europe,” Social
Indicators Research 127, no. 3 (June 24, 2015): 1039–56.

26.

Weaver, Born, and Whaley, 2010.

27.

Weaver, Born, and Whaley, 2010.

28.

Seth Klein et al., “A Poverty Reduction Plan for BC”
(Vancouver, BC: Canadian Centre for Policy Alternatives,
BC Office, 2008), 30.

29.

Region of Waterloo Social Services, “Poverty Indicators
in Waterloo Region: Status Report 2014.”

16.

Carlton and Born, 2016.

17.

Mark Lemstra and Cory Neudorf, “Health Disparity
in Saskatoon: Analysis to Intervention” (Saskatoon,
SK: Saskatoon Health Region, 2008), https://www.
saskatoonhealthregion.ca/locations_services/Services/
Health-Observatory/Documents/Reports-Publications/
HealthDisparityRept-complete.pdf.

30.

Saskatoon Poverty Reduction Partnership, “Indicators
of Outcome Progress,” accessed August 23, 2016, http://
www.saskatoonpoverty2possibility.ca/outcomesprogress.html.

31.

Klein et al., 2008.

18.

Carlton and Born, 2016, p.25.

32.

19.

Canadian Population Health Initiative, “Trends in IncomeRelated Health Inequalities in Canada: Technical Report”
(Ottawa, ON: Canadian Institute for Health Information,
2015), https://secure.cihi.ca/free_products/trends_in_
income_related_inequalities_in_canada_2015_en.pdf.

Rachel Loopstra and Valerie Tarasuk, “Food Bank Usage
Is a Poor Indicator of Food Insecurity: Insights from
Canada,” Social Policy and Society 14, no. 3 (July 2015):
443–55.

33.

Na Li et al., “Priority Health Equity Indicators for British
Columbia: Household Food Insecurity Indicator Report”
(Toronto, ON: Research to Identify Policy Options to
Reduce Food Insecurity (PROOF), 2016), http://proof.
utoronto.ca/.

34.

Chamberlain, 2008.

35.

Chamberlain, 2008.

36.

Mark Kramer, Marcie Parkhurst, and Lalitha
Vaidyanathan, “Breakthroughs in Shared Measurement
and Social Impact”
(FSG Social Impact Advisors, 2009), http://
vibrantcanada.ca/files/breakthroughs_in_shared_
measurement_complete.pdf.

20.

21.

Canadian Institute for Health Information, “Health
Inequalities Interactive Tool,” Canadian Institute for Health
Information, June 2, 2016, https://www.cihi.ca/en/factorsinfluencing-health/socio-economic/health-inequalitiesinteractive-tool.
Provincial Health Services Authority, “Priority Health Equity
Indicators for British Columbia: Selected Indicators Report”
(Vancouver, BC: Provincial Health Services Authority,
Population and Public Health Program, 2016), http://
www.phsa.ca/population-public-health-site/Documents/
Priority%20health%20equity%20indicators%20for%20
BC_selected%20indicators%20report_2016.pdf.

The Columbia Basin Rural Development Institute, at Selkirk College, is a regional research centre with a
mandate to support informed decision-making by Columbia Basin-Boundary communities through the
provision of information, applied research and related outreach and extension support.

www.cbrdi.ca

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