Mixed Results for Social Assistance in Budget 2014

Mixed Results for Social Assistance in Budget 2014

TORONTO (1 May 2014) – Ontario’s 2014 Budget takes important steps to reduce poverty in Ontario through investments in income benefits, housing and homelessness supports, and expanded health benefits for low-income children. However, the Budget provides mixed results for Ontarians relying on the province’s two social assistance programs.

The 2014 Budget contains a 4.8% increase for single people without children receiving Ontario Works (OW). This increase would mean an additional $30 per month for singles on OW, who currently receive monthly benefits of $626. The increase represents a much-needed $55 million investment in social assistance benefits.

The Budget also includes a 1% increase to rates for all families on OW and people with disabilities receiving ODSP. However, a freeze will continue to be applied to rates for the family members of people with disabilities receiving benefits from the Ontario Disability Support Program (ODSP). The freeze on rates began in the 2013 budget.

“Making a significant investment in people who live in the greatest depth of poverty is critically important, and while incomes need to increase more quickly we commend government for making this a priority,” said Jennefer Laidley, Research and Policy Analyst at the Income Security Advocacy Centre. “But we continue to question withholding a rate increase, which will not even keep pace with inflation, from families of people with disabilities who already struggle to make ends meet while contending with the impacts of having a disability.”

The Budget also includes plans to consolidate seven different employment benefits in OW and ODSP starting in January 2015. Before then, the Ministry of Community and Social Services will conduct discussions with stakeholders about the design of the consolidated program. After that time, people on ODSP receiving the Work-Related Benefit will continue to receive that benefit for a six-month transitional period.

“Consolidating benefits may mean a simpler system, but simplicity can’t come at the price of losing a benefit that may play a significant role in people’s incomes,” said Mary Marrone, ISAC’s Director of Advocacy and Legal Services. “The impact of consolidation will depend on how the new benefit is implemented. We will continue to advocate and work with government to make sure the new benefit provides the employment-related supports that people on OW and ODSP need, without leaving anyone worse off.”

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Some very good news in the Budget is an additional $42 million in annual funding for the Community Homelessness Prevention Initiative (CHPI), which is administered by municipalities. The Community Start-Up and Maintenance Benefit (CSUMB) was eliminated from social assistance in the 2012 Budget, with half of former CSUMB funding consolidated into CHPI starting January 2013. Government topped-up this funding with a $42 million transitional fund after strong community concern.

“Advocates across the province have been calling for the $42 million in transitional funding to be made a permanent part of the CHPI program since January 2013,” said Laidley. “Today’s Budget announcement responds to that call and will make a significant impact on the ability of municipalities to provide the direct financial supports that low-income Ontarians need to access and maintain their housing.”

Other important measures in the Budget that will support poverty reduction efforts include:

Confirmation of a $100 increase to the Ontario Child Benefit (OCB) starting July 2014 that brings the maximum OCB to $1,310 per year, with inflationary increases starting in July 2015;
A new health benefit program that would give access to prescription drugs, assistive devices, vision care and mental health services to all low-income children, in addition to expanding dental care for low-income children;
Doubling the number of people eligible for Legal Aid assistance by making the first increases to the income eligibility threshold since the 1990s;
A new made-in-Ontario pension plan that would assist in ensuring retirement income security;
An inflationary increase to the minimum wage starting October 2015, after an increase to $11 starting June 2014;
$400 million over five years in the Investment in Affordable Housing program to match Federal funding for affordable housing;
A framework that will require provincially-funded infrastructure projects to include employment opportunities for at-risk youth, local communities and veterans.

While Budget 2013 made several positive rule changes in OW and ODSP, Budget 2014 does not continue that trend. The Budget doesn’t respond to the ongoing call from children’s advocates across Ontario to end dollar-for-dollar deductions of child support from the benefits of single parents receiving OW and ODSP. And it does not end the continuing restructuring of OW and ODSP basic needs benefits as increases are made to the Ontario Child Benefit. It does, however, recognize that increased investments in social assistance will “contribute to economic growth, as the supports provided are used to purchase basic household goods and services that are purchased locally” (p245).

“We look forward to government’s announcement of its next five-year Poverty Reduction Strategy in the coming days,” said Laidley. “And we look to all parties in the Ontario legislature to take the opportunity now to make further steps to eradicate poverty and reduce income inequality in Ontario.”

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Contact: Jennefer Laidley, Research and Policy Analyst

416-597-5820 x 5155