Pay equity and the government’s redistribution responsibility

Pay equity is widely acknowledged as a human right that can significantly reduce poverty for working women. In New Brunswick, an estimated 12,000 community care workers, mostly women, suffer greatly from low wages and extremely precarious working conditions, according a 2026 report by the New Brunswick Coalition for Pay Equity. 

When the Liberal Party was the opposition party, Liberal MP Isabelle Thériault introduced a legislative motion on November 2, 2023 that began a government policy conversation on pay equity, “equal pay for work of recognized equal value.” This policy has special importance for working women and all workers affected by gender discrimination.

The motion proposed that pay equity be implemented for the community care sector by 2026. The sector generally receives all its funding from the province, and its representatives have been actively advocating for pay equity for several years. The Blaine Higgs’ government defeated the Liberal motion. 

However, as premier, Susan Holt is faced with the realities and responsibilities of governing. Her government has continued to promise to implement pay equity legislation that is similar to Quebec and Ontario’s legislation, for the entire private sector, not only the community care sector, by 2027. 

Her government proposes to do this while facing tariff threats from the U.S. and the challenges of a weaker than expected financial position because of slowing revenues and rising expenditures.

According to the government’s budget discussion paper, the Holt government still wants “to invest in priority areas like pay equity while still delivering the important services that people depend upon everyday” while responding to potential threats to the bottom line.

Clearly the government wants to be perceived as taking a balanced approach to the problem of increasing expenditures and declining revenues. The budget discussion paper also notes that the provincial economy has been relatively healthy, referencing standard economic measures of debt to GDP and taxation to GDP ratios showing relative and comparative strength. In 2025, New Brunswick’s debt to GDP ratio was approximately 27 per cent while in Nova Scotia, for example, it was about 33 per cent.

Inequality and its costs

Not talked about in conversations about economic measures by most governments and their economic advisers is structural inequity. Strong evidence shows inequity in our society has increased significantly and is having its own negative impacts on economic, political, and social well being. 

For example, according to a 2026 Oxfam report, in Canada the top 20 per cent of income earners held an estimated 39 per cent of all income over the period 2000 to 2011. However, in 2025, this position of the top 20 per cent of income earners increased to nearly half (48 per cent) of all income. 

This growing income inequality is a concern for three reasons. Firstly, growing income inequality directly and negatively affects the essential services of the community care sector. Secondly, this inequality is what a vigorous and well-planned pay equity policy intends to address. And most importantly for this discussion, this growing income inequality is nothing less than a serious “market failure.” However, governments are under constant pressure from economists adhering to certain dominant theoretical models, lobbyists, and interest groups, to ignore or abdicate their responsibility to create a more equitable distribution of income and wealth. (See Rod Hill and Tony Myatt’s 2010 book, The Economics Anti-Textbook: A Critical Thinkers Guide to Micro-Economics, especially pages 176-218).

In fact, many experienced and astute observers of the Canadian and global macro-economy are now saying what Adam King at The Maple wrote, that “without addressing the growing chasm in wealth inequality it becomes very difficult to imagine being able to address the many pressing social issues that are plaguing most nations.” 

The decisions a government makes on revenues and expenditures then becomes very much a matter of choices informed by both theory and values and by whom it chooses to listen to. Mainstream economics has a long tradition of bias against government especially regarding its redistributive role and responsibility. Issues of inequality and inequity get little attention in comparison to the efficient allocation of resources for the sake of wealth creation. 

However, there are compelling indications now that with well-designed policies no significant equity-efficiency trade-off is required. Poverty and inequity can be reduced without negatively impacting the economy. 

In fact, social and economic inequalities within our societies are directly responsible for serious inequalities in health and quality of life which have their own negative social-economic impacts.

This deep bias in the economics’ discipline against government’s redistribution of wealth responsibility is carried over into government economic policy. Redistributive policies directly addressing inequality are viewed as unimportant especially when eclipsed by an uncritical and even habitual austerity discourse. 

This unfortunate and at times tragic bias can be off-set if a government and its pay equity allies deliberately set out to seek guidance for an alternative social-economic policy analysis that recognizes and addresses this growing inequity in our society and the exploitation it is based upon.  There is an alternative which can be effectively pursued through carefully designed policies based upon a proper analytical framework that rethinks the standard approach to the so-called equity-efficiency trade-offs.

New Brunswick’s proposal to implement pay equity for the community care and entire private sector is nothing short of historic. As we move toward 2027, this is an important provincial issue to be supported. My calculations based on what wage workers earn in the community care sector today means the workers could see an increase in annual income of $8,000 to $10,000. 

Hugh Williams lives in Debec, New Brunswick and has worked in the community care sector and taught philosophy at St. Thomas University and the University of New Brunswick.