CCSD response to recent development of welfare-to-work programs

March 3, 1999

Introduction

In the wake of large-scale reductions in federal support for social assistance programs in the 1990s and pressures on provincial and local governments to restrict spending and reduce deficits, provincial and territorial welfare programs have changed their orientation significantly in recent years. Increasingly, these programs have become focused on moving welfare recipients off of benefits and into the workforce. In many provinces there are sanctions for welfare recipients who do not seek work or training.

The federal government is also encouraging the development of welfare-to-work programs through its National Child Benefit (NCB), which delivers benefits to low-income families on the understanding that resulting provincial welfare savings will be spent on programs to reduce child poverty and to "promote attachment to the workforce." Each province has now established NCB reinvestment programs which generally deliver health and child care benefits or income supplementation to poor families with children, particularly those in working-poor families. In three jurisdictions, however, the increased federal funding is passed on to families on welfare. It is too early to assess how many additional services or supports will be delivered as a result of NCB initiatives for children whose parents receive welfare.

Although the trend in the 1990s towards welfare-to-work programs appears to be novel, in many ways it harkens back to the 1930s Great Depression years, when welfare programs often included a compulsory work component. As the Canadian economy rebounded and unemployment dropped during and after World War II, welfare programs became targeted towards the "residual" population who, for a variety of reasons, were considered to be unable to perform paid work. The re-emergence of welfare-to-work programs at a time when the economy is once again unable to provide full employment raises the troubling question: will the stricter requirements of welfare-to-work programs force people into an even deeper level of poverty if they leave social assistance but are unable to find steady paid work?

To better understand this shift in orientation, the CCSD, with funding from Human Resources Development Canada (HRDC), undertook a major survey of provincial and territorial welfare-to-work programs across Canada. This study has resulted in the release of two documents today: Welfare-to-Work Programs: A National Inventory and Welfare-to-Work Programs: A Discussion Paper, both by Carolyne Gorlick and Guy Brethour.

These documents provide a useful and detailed description of the welfare-to-work programs, but they also raise some alarming concerns, including the following:

  • Single parents – one of the largest groups of welfare recipients – are being identified as work-ready when their children are at a much younger age than was the case in the past, ranging from six months in Alberta to seven years in other provinces. Formerly, single parents were not deemed to be work-ready until their children had finished school. Parenting was, in itself, considered to be a valuable form of work.

  • While most provinces make some provision for child-care subsidies for welfare recipients who are seeking work or training, the amounts are low compared to the real costs. The CCSD is also concerned that other supports necessary for making the transition from welfare to work are often inadequate.

  • Welfare support for job training and placement programs is increasing. However, cost restraints mean that programs concentrate on the shortest possible route to employment. Longer-term education and training programs such as community college or university courses are not usually considered to be eligible. The choice of training options for most welfare recipients is becoming narrower, with exceptions in Atlantic Canada and the territories.

  • Administrators in many provinces report a continuing lack of coordination with programs offered to Employment Insurance recipients who are generally provided with a wider range of options than are welfare recipients.

  • The replacement of the shared-cost Canada Assistance Plan – which contained some national standards for guiding provincial social assistance – by the Canada Health and Social Transfer (CHST) – with block funds but almost no standards – has meant that the differences among programs offered by the provinces have grown. This is illustrated by variations in the level of services, supports and benefits offered in welfare-to-work programs. The Council is concerned that this will lead to increasing inequities between provinces with regard to welfare support.

  • The evaluation of welfare-to-work programs is generally based on a cost-benefit analysis which assesses only the financial savings to the province. There is only minimal evaluation of the benefits that recipients and their families might receive from the program, or of the costs and shortcomings endured by them.

  • Several of the welfare-to-work programs have explicit underlying principles, exemplified by those in Alberta, which state that:

    • People want to work.

    • Any job is a good job.

    • People on welfare should not be better off than others in the province.

    These programs punish welfare recipients who do not actively seek or find work by reducing their benefits. While some provinces have pilot projects in place that offer training and support for job searches, others place far more reliance on the individuals to seek work or training. In most jurisdictions, the number of people on welfare who have signed up for employment opportunities far exceeds the number of jobs that the agencies have been able to find.

  • Welfare payments in all provinces place recipients well below Statistics Canada's low income cut-offs (LICOs). Jobs paying minimum wages also leave earners well below the LICOs, and unemployment rates remain high in many regions of the country.

Recommendations

The income gap between rich and poor in Canada has grown in recent years, as highlighted by the 1998 United Nations Human Development Index which ranked Canada in 10th place for its level of income disparity among 17 developed countries. Concerns about social cohesion and the general standard of living in Canada rise when income disparities increase. The CCSD is concerned that Canada may not, in fact, be meeting its United Nations commitments that require countries to provide adequate food, shelter, education and other basics of life, if we are forcing people off welfare and into any low-paying job.

Given these findings and concerns, the CCSD puts forward the following recommendations regarding welfare-to-work programs:

Goals

  • Welfare programs should be designed to ensure that recipients are able to participate in society. Raising people's economic productivity should not be the sole goal of welfare programs. They should serve much broader social objectives, including support for child and family development.

  • Welfare-to-work programs in Canada should be based on a human and social development approach – meaning that the goals of all such programs should be to enable people to become self-sufficient in the long-term, and they should strengthen the social and economic fabric of communities.

  • The end goal of every welfare program should be to reduce poverty, not simply to reduce the length of time that people are in receipt of social assistance. Welfare-to-work programs should ensure that no welfare recipient ends up poorer than before as a result of the program requirements.

  • Programs should be designed by governments in partnership with local business and voluntary organizations with the goal of supporting expanded employment opportunities. They should not be designed to encourage employers to replace their current employees with welfare recipients whose wages are lower or are subsidized by the government.

Principles

All welfare-to-work programs should adhere to the following principles:

  • Equity: All Canadians should have equitable access to programs designed to enable them to become self-sufficient, regardless of where they live, how long they have been unemployed, their family situation or their personal level of ability.

  • Voluntary participation: The work or training component of welfare-to-work programs should be voluntary. The right of Canadians to choose their own work should be an underlying principle of any welfare-to-work program. Welfare programs should support people and encourage them to participate in the economy; they should not be designed to punish people for being jobless.

  • Promotion of dignity and independence: Welfare programs should be designed to protect the dignity and independence of recipients. A careful review of policies and procedures should be conducted to ensure that these principles are adhered to.

Procedures

  • All welfare recipients should have the right to appeal decisions made about their cases to a body independent of the program administration.

  • All welfare programs should include short- and long-term evaluation measures to assess their impact on program recipients and on the local communities. If the programs are simply reducing the number of people on welfare, without increasing the number who have jobs, they should be considered as a failure, not as a success.

Funding

  • The federal and provincial governments should take primary responsibility for funding welfare programs, with the design of each program being developed in partnership with local governments and community-based groups so that the programs respond to local economic and social needs.

  • Governments need to view welfare-to-work programs as long-term investments designed to increase people's ability to contribute to society. Programs should recognize both the need for the development of human capital (that is, developing job readiness and job skills for welfare recipients) and the need for social resources (such as child care, transportation, available jobs). While these programs may increase welfare expenditures in the short term, they are more likely to contribute to social cohesion and to long-term gains to the public purse by permanently moving people off of the welfare rolls and into the labour force.

CCSD

Canada's Social Development Convenors

info@ccsd.ca

Phone: 613-236-8977

Kanata, ON

P.O. Box 13713 K2K 1X6

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