Social Policy in Ontario

Remove bricks from welfare wall

Posted on December 8, 2007 in Inclusion Debates, Social Security Debates

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TheStar.com – comment – Remove bricks from welfare wall
December 08, 2007

You would think that taxpayers who foot the bill for welfare would want the government to do everything in its power to help people on welfare to break free from the system and become self-sufficient.

Yet in many ways, the government puts a massive wall in the way of those trying to get off welfare. What that wall consists of is a tangle of rules and regulations that can leave welfare recipients worse off if they try to make the transition from welfare to work or if they try to better themselves by getting an education.

For example, if social assistance recipients work part-time to supplement their meagre incomes, welfare deducts 50 cents of every dollar they earn. If they live in public housing, their subsidized rent goes up 30 cents for every dollar earned. The remaining 20 cents is not even enough to cover work expenses such as public transit, child care, clothing and payroll deductions like the Canada Pension Plan.

When added up, these deductions and extra work-related costs can be more than 100 per cent of what a person earned.

Last week, Star reporter Laurie Monsebraaten told readers the story of Zuher Ismail and his mother’s efforts to escape poverty and the barriers Queen’s Park has thrown in their way. Ismail lives with his working mother in a Toronto public housing building. When he took a part-time job to help pay the cost of his post-secondary education, his mother’s subsidized rent went up by $100 a month. But if he were to move out to free her from that penalty, he could not earn enough money to support himself and still pay for his schooling.

That is just one example of the catch-22 situations outlined in a new report by policy analyst John Stapleton with the fitting title Why is it so tough to get ahead? How our tangled social programs pathologize the transition to self-reliance. The study was funded by the privately endowed Metcalfe Foundation.

The report spells out in detail how government policies and programs too often work at cross-purposes to punish people trying to improve their circumstances. Instead of assisting those who want to work, more often than not these policies discourage work.

And as a result, these misdirected social policies serve only to perpetuate poverty. By penalizing 18-year-olds such as Ismail who want to go to school, the rules, in fact, give them plenty of reasons to drop out.

This is counterproductive, because 18-year-olds should not be punished for trying to escape the conditions in which they grow up.

Stapleton, who for nearly three decades worked for Ontario’s ministry of social services, says one thing the government could do to facilitate people’s efforts to become more self-reliant is to give them “time outs,” which would act as grace periods on public-housing rent increases, welfare and child benefit clawbacks and cuts to child-care subsidies.

For young people like Ismail, Stapleton recommends a grace period of up to four years so they can live at home, work part-time and pursue an education without causing more hardship for their families.

The Ontario government has already passed legislation to allow welfare recipients who take a job to keep their health benefits for six months to reduce this “welfare wall.” Extending that six-month moratorium to all the other punitive measures that hit newly working adults is well worth more detailed study by Queen’s Park. Stapleton claims it could be introduced almost overnight and would not be too costly.

Such changes would only affect an estimated 25,000 welfare families in the province who find themselves in a position where it is better for them financially to stay on welfare than go to work or school.

In the longer term, as the province comes up with its promised poverty reduction strategy, it should work with the federal government to ensure there are positive incentives for welfare recipients to find a job or pursue a post-secondary education.

Encouraging people to work and then in effect stripping them of the financial benefits that come with work makes little sense.

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