In 1996, the Liberal government scrapped the federal minimum wage as part of a broad program of cuts. With no federal minimum wage, it was left up to the provinces to set a minimum wage. This, along with other poor decisions, contributed to growing income inequality.
Several studies show that increasing the minimum wage significantly decreases income inequality. In 2006, the Federal Labour Standards Review Commission recommended that the government reinstate the federal minimum wage and base it on Statistics Canada’s low-income cut-off.