Thursday, November 26, 2009

Why don't we want the poor to own anything?

Since the days of Mike Harris municipalities have been up against it having to deal with the so-called reform of the welfare system. Recently I read a report by John Stapleton, a well respected social policy expert. The report addresses one aspect of what social assistance applicants and recipients have to deal with.

The report that is called “Why don’t we want the poor to own anything? Our relentless social policy journey toward destitution for the 900,000 poorest people in Ontario.”

The title says a lot.

The report is about asset testing. I’m not sure whether many readers of this blog have direct experience with this cruel and foolish policy. Asset testing limits eligibility to welfare benefits when applicants have certain liquid assets above an established limit.

Asset testing used today is far more stringent than at any time since the post-war period.

Read Stapleton’s report at

Here is a Cole’s notes version.

*Most programs in Canada have abandoned asset testing.

* Seven per cent of Ontario’s population are subject to often stringent asset testing.

*Asset limits were dropped by a factor of five (single persons) and four (lone parent) by Mike Harris, a change which was in many ways had much more impact than the 21.6 per cent cuts to social assistance he put in place.

*The asset limit for lone parents in 1948 adjusted to inflation would be $10,900 today. In fact, the current asset limit is $1,550.

Since the McGuinty government came into power, many of the Harris implemented clampdowns have been relaxed or removed. And while the limits on assets have changed, the huge drops in asset limits “caused by linking asset accumulation to monthly rates have yet to be addressed.”

What to do

Stapleton wants to:

*Raise asset limits for social assistance and legal aid to $5,000 for singles and $10,000 for families with disabilities.

*Get in line with Alberta and Quebec by exempting portions or all of Tax Free Savings and RRSPs.

*Exempt, in the short term, all assets for the first six months of receipt of assistance.

*Eliminate the option to test subsidized housing under the Social Housing Reform Act.

Hopefully, decision makers will read this report.

What do you think?