Social Assistance Rates and the Ontario Election

Social assistance rates should have some relation to the real cost of living but almost never have. 

(See http://whenthemayorsmiles.blogspot.com/2020_10_19_archive.html)

Rates in 1993 under the Bob Rae NDP government were set at a level that arguably reflected the real cost of living. They don’t now.

With a provincial election coming up in June it is interesting to speculate on what the major parties will offer on the policy front re social assistance rates. (Note: We are talking about what is politically possible not what is right.) 

John Stapleton, a respected public policy guru, looks at the issue in https://openpolicyontario.com/16-2-in-22-a-social-assistance-litmus-for-2022/

There has been one small increase of 1.5% to Ontario Works (OW) since the Ford government was elected in 2018.  Ontario Disability Support Program (ODSP) had a single 1.5% increase as well that was, in fact, a rollback of a promised 3% boost.

Stapleton takes those 1993 fairer rates and calculates that OW and ODSP would have to be raised 67% to get back to those levels. Politically that is a non-starter.

In the 1995 election poverty denier Mike Harris succeeded in portraying single mothers receiving assistance as some sort of boogie monsters ripping off the oppressed taxpayers of Ontario

One of Harris’ first acts as premier was to cut social assistance rates by 21.6%.  

Stapleton takes 1995 as a starting point, builds in the 16.2% inflation that has occurred since then and comes up with new rates.   

“… the OW single rate would climb by 16.2% from $733 a month to $852 a month… a  similar 16.2% increase to ODSP (would) take the single rate from $1,169 to $1,359 a month.”

It is doable.  The Ford government is spending less on this file.  Since the beginning of the pandemic in April 2020, the number of social assistance beneficiaries has fallen by 15% or over 146,000 beneficiaries. 

I’ve written to MPP (see below) and hope you will too.  We should expect a commitment from all provincial parties to do something about the injustice of inadequate social assistance rates.   

This story has been updated to reflect the fact that OW rates were increased by 1.5% in 2018.

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December 22, 2021
Toby Barrett 
MPP Haldimand Norfolk 
 

 Dear Mr. Barrett, 

Re: Raising Social Assistance Rates for Individuals 

Nearly a year ago (January 26, 2021) I wrote to you about the need to raise social assistance rates.

Other than acknowledgement that my letter was received, I have not received a reply from you.

For social assistance recipients the situation has worsened over the past year. 

Rates are the same and continue to be well below poverty levels.  Canada’s Consumer Price Index has risen 4.4% the highest rate since 2003.

Meanwhile your government has made no meaningful investments or taken any action on programs or policies that would improve income security for low-income Ontarians. 

In terms or digital access, the government seems to believe that building infrastructure is all that is needed.  While you have pledged $2 billion in broadband infrastructure, no money has been provided to assist low-income Ontarians pay for Canada’s high internet and data costs. Now, Tribunals in Ontario are moving to a digital-first approach.  Investing in subsidizing internet costs for people on social assistance and all low income Ontarians is essential for both access to caseworkers and access to justice. 

It is imperative that social assistance rates be raised to reflect the real cost of living in Ontario.

Your attention to this matter is appreciated.  I look forward to your response.   

Sincerely, 
Bob Wood 

Raising Social Assistance Rates

I just read an interesting policy paper from Open Policy Ontario.

Authored by John Stapleton and Yvonne Yuan the paper looks at the question of whether  higher social assistance rates lead to higher caseloads during recessions.

Well, they don’t.  

The authors conclude that when you take a look at unemployment data and minimum wage levels over time you’ll see that that higher social assistance benefit levels will not result in more people on social assistance. 

Stapleton and Yuan recommend immediate implementation of either: 

1. Raising the single Ontario Works assistance rate by 14.3% to $838 per month to equal 40% of full-time minimum wages along with parallel increases for other family sizes or 

2. Raising Ontario refundable tax credits by $1,365 per year so that all low-income single people can benefit from an increase in income. 

They also recommend that minimum wages be immediately increased to $15.00 per hour.

Read the report at https://openpolicyontario.s3.amazonaws.com/uploads/2021/03/culprits-20210219r-sacs.pdf

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Fast Facts

• There has been no increase in rates since 2018 a continuation of a gradual downward slide in the value of social assistance that began with a drastic cut in 1995.  
• According to the Ontario government, evidence shows that racially diverse, newcomer and low-income communities have been impacted more significantly by COVID-19 than others.
• The federal government’s response to the pandemic has identified $2,000 per month as a “basic income” for people who have lost their jobs. The current rates for single individuals on Ontario Works (OW) is $733 and for Ontario Disability Support program (ODSP) is $1,169.00 fall far below this “basic income.”. 
• The annual cost of poverty in Ontario is between $27.1 and $33 billion taking into account loss of tax revenue and increased expenses in the health and justice systems (Feed Ontario. The Cost of Poverty in Ontario 2019, p.4).  

Here is a link to a chart that illustrates how the buying power of social assistance rates has continued to sink over the years, because of minimal or no annual increases to match inflation. 

https://1drv.ms/w/s!AvRzOEPfSVfDvQTzDtVAYONTQ22W?e=LJGTc5