Making sense of Ontario’s social assistance reforms

Posted on in Social Security Policy Context

TheStar.com – News/GTA
Nov. 30, 2018.   By

The Ford government’s plan to overhaul provincial social assistance, announced Nov. 22, was long on rhetoric and short on details.

Lisa MacLeod, minister of children, community and social services, said she is working with other ministries and municipalities to create a system that provides dignity for everyone and individualized action plans to help those who can work find employment. Changes are expected in the next 18 months.

But what does it mean for almost one million residents who rely on Ontario Works (OW) or the Ontario Disability Support Program (ODSP)? The Star waded through government statements and websites and consulted advocates and social policy experts to find out.

The government says it wants to change the definition of disability for ODSP to align with federal guidelines. How does Ottawa define disability?

The federal government has two main programs that serve people with disabilities — the Canada Pension Plan disability benefit (CPP-D) and the Disability Tax Credit (DTC) — and both define disability more narrowly than ODSP.

CPP-D is for people under age 65 who have contributed to CPP, but can no longer work due to injury or illness. To qualify, a disability must be both “severe” and “prolonged,” and prevent the person from being able to work at any job on a regular basis, according to the federal government’s website. Under the definition, “severe” is defined as a mental or physical disability that regularly prevents the person from working in any type of employment.

“Prolonged” means the disability is long-term and of indefinite duration or is likely to result in death. Both the “severe” and “prolonged” criteria must be met simultaneously at the time of application.

Anyone can apply for the DTC (including people getting CPP-D). The qualification criteria is not dependent on ability to work, but rather the ability to carry out “basic activities of daily living.” These are defined as speaking, hearing, walking, bowel and bladder functions, feeding, dressing and mental functions necessary for daily life.

To qualify for the DTC, a person must be blind or “markedly restricted” in at least one basic daily living activity or “significantly restricted” in two or more basic living activities, or receiving life-sustaining therapy, such as dialysis. A person is “markedly restricted” if it takes an inordinate amount of time to do one of the basic daily living activities even with therapy, medication and appropriate devices. “Significantly restricted” means a person may not meet the criteria for “markedly restricted” but is still greatly restricted.

In addition, the person’s impairment must be prolonged — has lasted or is expected to last at least 12 months — and be present 90 per cent of the time.

Mary Marrone, legal director of the Income Security Advocacy Centre, a provincial legal clinic, says both definitions would be a problem for Ontario’s income program of last resort for people with disabilities.

“Many people with disabilities would be excluded, like those with episodic disabilities or some mental health disabilities, forcing them to rely on the much lower benefit amounts that Ontario Works provides,” she says. “Reform of the system should not start with what is effectively a rate reduction for new entrants.”

How does ODSP currently define disability?

Under ODSP, a person is considered disabled if they have a substantial mental or physical impairment that is continuous or recurrent, and is expected to last one year or more. The impairment must also directly result in a substantial restriction in a person’s ability to work, care for themselves, or take part in community life.

As Marrone notes, ODSP currently uses an inclusive definition of disability that recognizes that people whose disabilities might not be “severe” may still face serious obstacles to employment, participation in the community and in daily life. Many people currently receiving ODSP do not qualify for CPP-D or the DTC, she adds.

The province says the number of people receiving ODSP support has been growing by 3.5 per cent a year, significantly outpacing population growth.

The government says this is unsustainable. But in an aging society, where medical science is saving more injured, ill and disabled people from death and where new disabilities such as post-traumatic stress disorder and fibromyalgia are being recognized, it should be no surprise more people with disabilities are turning to ODSP for support, notes social policy expert John Stapleton, who worked in the provincial social services bureaucracy for 30 years.

A clampdown on Workers Safety and Insurance Board (WSIB) payments, the declining number of jobs with disability benefits and often meagre CPP payments due to uneven or short work history mean more people with chronic illnesses, injuries and disabilities have nowhere else to turn, he adds.

MacLeod cut a planned 3-per-cent increase to social assistance to 1.5 per cent last summer. Are there any plans to restore that cut?

Rate increases were not mentioned in MacLeod’s recent announcement. When asked by reporters if increases were coming, she refused to answer.

How much do people on social assistance currently receive?

An individual on OW receives up to $733 a month, while a single person on ODSP gets a maximum of $1,169.

Is that all?

People who have part-time or occasional jobs can receive training, travel and employment benefits. Those with health or medical conditions can receive a special diet allowance and supplements to pay for medical expenses, including diabetic and surgical/incontinence supplies, and medical travel, which can amount to several hundred dollars a month.

How would the proposed health spending account work?

The government says it wants to consolidate current ODSP health and medical supplements into a more simplified “health spending account” so people with disabilities can select and pay for the services they need. But there are no details on how much money would be in the accounts or if they would be available for people on OW with health or medical conditions.

What about local discretionary funds?

Under the changes, this new fund would allow municipal Ontario Works offices to better tailor employment-related benefits to individual needs. But it is unclear if the fund would include all current mandatory and discretionary work-related benefits or what would happen to employment supplements for people on ODSP.

How many people on social assistance have part-time or occasional jobs?

About 10 per cent of people on OW and ODSP — or about 100,000 people — report employment income each month.

MacLeod has said increased earning exemptions will encourage more people to work. Is that true?

Currently, people on social assistance can earn up to $200 a month before their benefits are reduced by 50 cents for every additional dollar they make. A person on OW can earn up to $19,922 a year and still qualify for $1 of social assistance along with drug and other benefits. Those on ODSP can make up to $30,456 and continue to receive supports.

Under the changes, people on OW will be allowed to earn up to $300 a month before clawbacks, while those on ODSP will be able to earn up to $6,000 a year without deductions. But their benefits will be reduced by 75 cents on every additional dollar they make. It means those on OW who earn more than $15,328 a year from work will no longer be eligible for social assistance while a person on ODSP gets kicked off the system when they earn more than $24,704.

“These changes seem counterproductive to the minister’s stated goal of providing more incentives for people to seek paid work,” said Marrone. “And people who work will actually become financially ineligible sooner, losing critical supports like drug coverage, which is increasingly unavailable from low-wage work.”

How will the changes impact poverty?

A single person in Ontario with an annual income of less than $22,657 after taxes and government transfers is considered poor, based on Statistics Canada’s 2016 low-income measure, the most recent available. Therefore, someone on OW can almost work their way to the poverty line under the current system before they are no longer eligible for social assistance when provincial and federal tax credits are included.

Under 2018 budget measures, since scrapped by the Ford government, those on OW would have been able to work themselves well out of poverty before losing their benefits.

But under the changes, a person on OW will still be almost $6,000 below the poverty line when their earnings make them ineligible for welfare.

For an individual who is disabled, an extra $6,000 is added to the poverty line in recognition of the added expenses of living with a disability. Currently, a single person on ODSP can work himself out of poverty while still receiving social assistance, but under the changes would be almost $4,000 short when becoming ineligible.

The new plan includes “wraparound” supports to employment. What does that mean?

Although there were few specific details about how it would work, MacLeod said she wants welfare caseworkers to do less policing of eligibility and offer more services to help people move into employment. She specifically mentioned support for mental health and addictions, child care, housing and life skills training. Advocates have welcomed the change of emphasis.

“We are encouraged by this focus, including the commitment to undertake pilot projects and proceed carefully,” said Marrone. “But if this is to be an empowering program, it needs to be about support, not sanctions.”

Laurie Monsebraaten is a Toronto-based reporter covering social justice.

https://www.thestar.com/news/gta/2018/11/19/making-sense-of-ontarios-social-assistance-reforms.html

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