Amidst an affordability crisis and rising food costs, several of Canadian food banks are grappling with financial challenges, despite having built up record reserves during the pandemic. These reserves, which swelled to tens of millions of dollars, are now beginning to shrink as expenses surge and donations decline.
In 2022, twelve major food banks across the country collectively held approximately $168 million in cash and investments, a nearly fourfold increase in their reserve balances since 2019. National and provincial food bank associations added an extra $70 million to their reserves.
The surge in reserves was fueled by multi-million dollar surpluses, primarily driven by generous donations during the pandemic and substantial government grants. For some food banks, these surpluses are still contributing to their financial cushion.
However, the situation is changing rapidly. David Long, CEO of the Greater Vancouver Food Bank, expressed concerns about the future, given the mounting food costs and the housing crisis. Many food bank CEOs are observing their surpluses turning into deficits as donations dwindle and demand for food assistance continues to rise.
Long described it as a “perfect storm” where more people are in need of food assistance, but a significant portion of the population has less discretionary income to contribute to charities.
Rachael Wilson, CEO of the Ottawa Food Bank, mentioned that they anticipated this budget challenge and saved accordingly. Their reserves have decreased from $22.3 million to approximately $14 million, partly due to funding equipment for a new building and providing grants to community food banks that are also facing difficulties.
In Toronto, the Daily Bread Canadian Food Banks reserves increased twelvefold from 2019 to 2022. However, CEO Neil Hetherington