Social Policy in Ontario

The Ontario Progressive Conservatives are cutting a planned increase to welfare rates this fall, with Social Services Minister Lisa MacLeod promising a full plan for social-assistance reform within 100 days.

Instead of seeing the first of three three-per-cent increases in Ontario Works and Ontario Disability Support Program payments this fall, she said at a Toronto news conference, recipients will get a 1.5-per-cent increase (in September for those on disability programs, in October for those on Ontario Works). Future increases are in limbo while the government figures out what it wants to do.

A single adult in Ontario can receive as much as $721 a month for shelter and “basic needs” from Ontario Works. A couple with two children can receive as much as $1,230.

About 247,000 people are on Ontario Works (which is aimed at people who could be employed but aren’t) and about 372,000 are on the Ontario Disability Support Program (for people who have disabilities that prevent them from working). ODSP, in particular, has all sorts of different criteria for additional payments depending on exactly what a recipient’s struggles are.

The problem, MacLeod said, is that the social-assistance system doesn’t help people, which she learned from her briefings since she became the minister responsible at the end of June.

“It was, to put it mildly, a mess. The Liberals presided over a disjointed, patchwork system, with no interest at all in whether these programs delivered results,” she said.

The system needs “a pause,” she said. That’s the word the Tories have used to describe what they’ve done with tougher anti-tobacco rules, changes to the way police are overseen, and popular elections for top officials in some regional governments. Everything is being paused.

The Liberals admitted the welfare system needed reforming in their last budget, promising to “simplify social assistance programs and relieve administrative barriers faced by people accessing social assistance.” They wanted to refocus the system on “providing early and appropriate supports that empower individuals and families,” with a whole package of changes. Together, along with the rate increases, they were to cost $2.3 billion over three years.

The Tories did not mention social assistance in their list of promises before the June election.

Ordinarily a confident performer with a microphone, MacLeod spoke haltingly and stuck to talking points Tuesday. She wouldn’t say how much the smaller rate hike would save the government, for instance, though that’s something her ministry would surely have calculated. Based on figures in the last Liberal budget, it’s potentially about $150 million this year. If rates stay frozen, that would save $550 million next year and $1.2 billion the year after that, compared with what the Liberals expected to spend.

“This decision isn’t about saving money. This decision is about fixing a broken system, and making sure we have the capacity to help people get back on their feet,” MacLeod said.

How is a 1.5-per-cent increase to welfare rates kinder to recipients than a three-per-cent hike?

It’s 1.5 per cent more than they’re getting now, MacLeod said.

“Look, what I’m announcing today is about restoring dignity to Ontarians. Making sure that on compassionate grounds, they have a rate increase immediately. … But let me be clear, the best social program is a job, for those that can have one.”

She pointed out that the government has plans to cut electricity prices, has scrapped the price on carbon emissions and will cut gasoline taxes, all of which means more money in people’s pockets.

The government is also scrapping an experiment with a universal basic income the Liberals started in Hamilton, Brantford, Brant County, Lindsay and Thunder Bay and its surroundings. The theory is that wiping away a bunch of programs with different qualifying standards and reporting requirements and replacing them with a simple payment means much less bureaucracy, gives recipients more freedom to make their own financial choices, and rewards participants for earning money by working.

The Liberals took up a version advocated by Milton Friedman, the patron saint of free-market economics, called a “negative income tax.” The point of the pilot project has been to see how costs and outcomes compare to the existing system in larger and smaller Ontario communities. It was supposed to be a three-year trial and it finished enrolling the last of several thousand participants last April. The Progressive Conservatives had even promised to see the experiment through.

But it’s not working, MacLeod said. How does she know, a reporter asked. It’s only just started.

“Here’s the situation,” MacLeod said. “When many parts of my ministry were repatriated … there was a great deal of disjointed, patchwork policies that really weren’t communicating with one another. What we’ve seen is that the program isn’t doing what it’s intended to be doing, so we’ve decided to wind it down.”

In 100 days — by Nov. 8 — the government will have a plan to “reform social assistance so it helps more people break the cycle of poverty, re-enter the workforce and get back on track,” the news release accompanying MacLeod’s presentation said.

https://nationalpost.com/news/local-news/reevely-ontario-government-cuts-welfare-hike-in-half-ends-basic-income-trial/wcm/55d629d8-dca7-4a87-9e54-b3df8bc16438