Social Policy in Ontario

Instead of grappling with the big issue — how to make up for four years of frozen wages — the panelists applied a narrow focus and limited themselves to recommendations related to annual cost-of-living increases. Without improvement to the base pay, the working poor are being cheated.

It’s good that the government is planning to apply those inflation increases retroactively back to 2010, when the province last raised the minimum wage. As the Star’s Martin Regg Cohn writes, the increase would boost the minimum wage to $11 an hour from its current level of $10.25. For Ontario’s working poor, that’s at least some relief. But it falls far short of what’s needed.

The report by business, labour and student leaders offers a few minor recommendations beyond the need for cost-of-living increases. The group also recommends that the minimum wage be raised every April 1 to keep up with inflation, with four months notice to the business community.

This would still leave hardworking Ontarians, hundreds of thousands of them, stuck below the annual poverty line of around $23,000 a year, before taxes. Right now, working 35 hours a week at the basic wage brings in just $18,665 a year. It’s impossible to raise a family on that, especially in a big expensive city like Toronto.

While anti-poverty groups have been calling for increases pegged to inflation, as one way to help, on its own the proposed change is disappointing.

Premier Kathleen Wynne’s government can do better. It should, at the very least, follow the Ontario Liberals’ earlier trend of raising the minimum wage 2.5 times faster than the rate of inflation. As part of its “war on poverty” the previous Liberal government of Dalton McGuinty raised the provincial minimum wage by 50 per cent between 2004 when it was $6.85 an hour and 2010 when it topped out at $10.25 – a period when prices rose just 17.5 per cent.

If the same formula was followed now, it would mean an immediate jump in the minimum wage to about $11.65 an hour.

With the possibility of a spring election looming, Wynne likely wants toavoid the ire of the business community. Even the smallest jump in the minimum wage worries business groups, which have long pushed for increases limited to the rise in the Consumer Price Index.

Wynne is certainly speaking to the business lobby when she refuses demands for a boost to a $14-an-hour wage, saying “we have to move carefully because this is about making sure that we retain and create jobs.” It’s can’t be easy juggling roles as the self-described “Jobs Premier” and “Social Justice Premier.”

Minimum wage increases were once a cornerstone of the Liberals’ war on poverty. Under former Premier Dalton McGuinty, the Liberal government promised regular minimum wage increases and initially made good on that, pushing the minimum from $6.85 to $10.25.

The recession put a temporary stop to annual increases in the minimum wage, but workers have fallen so far behind that strong policy changes are needed. This issue requires more leadership than the Wynne government has shown so far.

< http://www.thestar.com/opinion/editorials/2014/01/27/longawaited_report_on_minimum_wage_increases_does_little_to_help_the_working_poor_editorial.html >