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April 1998
Canada's Income Security Programs
by Christopher Clark
Introduction
The purpose of this book is to provide readers with a comprehensive and easy-to-read description of Canada's income security programs. It is a basic reference tool for anyone – from the casual reader, to the student of politics or public policy, to policy analysts, researchers, and policy-makers. In short, it is for anyone who has an interest in income security programs. Canada's Income Security Programs is organized so that infor-mation can be quickly located, digested, and used to support a range of needs.
Chapters 1 through 4 each begin by outlining the historical evolution of the income security programs covered in that chapter. These brief historical reviews provide the reader with an understanding of how and why the various programs were put into place. From this base of knowledge, the reader moves on to more detailed descriptions of each of the programs as they are currently designed, including comprehensive descriptions of the following: what the particular program is and what it is intended to do; the benefits available and how people qualify for these benefits; and, the number of people that receive support and the value of individual and total benefits paid. In Chapter 5, each of Canada's major income security programs is re-examined in relation to its impact on the incomes of Canadians, and the role of each program for different types of households is analysed.
Chapter 1 examines the development and current status of child benefit programs in Canada. After tracing the evolution of such programs – from a tax exemption for families with children in 1919 to the establishment of the Child Tax Benefit in 1993 – the current system of both federal and provincial child benefit programs is described in detail. The new Canada Child Tax Benefit and federal-provincial efforts to establish a National Child Benefits System are outlined, as are federal tax provisions such as the Child Care Expense Deduction and the Equivalent-to-Spouse Credit, and numerous provincial benefits and tax provisions for families with children.
Chapter 2 provides a description of social assistance and other income supports, then and now, from the range of basic supports established over the course of the Great Depression and two World Wars, to a national system of provincially administered supports under the Canada Assistance Plan in the 1960s. The current provincial social assistance programs and the most recent trends in the administration of benefits are described, along with a comparison of provincial and territorial benefit levels. This chapter also examines the income security benefits and special tax supports available to persons with disabilities and war veterans.
Chapter 3 focuses on the two major programs that provide a replacement for lost earnings: federal Employment Insurance (previously called Unemployment Insurance) and provincial Workers' Compensation. This chapter traces the history of the Unemployment Insurance program from its meagre beginnings in 1941, the expansions in the 1960s and 1970s, to the contractions of the 1980s and 1990s. This is followed by a full description of the new Employment Insurance system that took effect in January 1996. The second part of the chapter describes the development of Workers' Compensation in Canada and highlights the main components of these provincially based programs.
Chapter 4 guides readers through the complex system of supports in Canada's retirement income system. Three sections describe the development and current status of the old age security system, the Canada and Quebec Pension Plans, and tax-assisted private pension and retirement savings plans. Details about the proposed Seniors Benefit are also provided, along with recent changes to the Canada and Quebec Pension Plans, and tax provisions for Registered Retirement Savings Plans.
Chapter 5 differs from the earlier chapters. Rather than examining the evolution of specific programs and their current structures, this chapter pulls together each of Canada's major income security programs and examines its impact on the incomes of Canadians. Within this analysis, the differing roles of social insurance and basic income support programs are examined, as is the impact of these programs on different types of households including families with children, the elderly, and households at various income levels.
A glossary is provided for terms commonly used in the income security field. Terms such as "benefit indexation," "equalization," and "claw-back" are explained and placed into context for the reader.
It is important to note that the information in this book is based on the most accurate and current data available as of the end of 1997. Governments at all levels periodically introduce small changes to programs, and sometimes they even undertake large-scale reforms of a particular program or income tax provision. As this book went to print early in 1998, several small changes were announced or had just taken effect. These changes – including a number of measures identified in the 1998 federal budget – are outlined in Appendix 1.
Canada's Income Security Programs - Related Material
Canadian Council on Social Development,
309 Cooper Street, 5th Floor,
Ottawa, Ontario, K2P 0G5
Tel: (613) 236-8977, Fax: (613) 236-2750, Web: www.ccsd.ca, Email: council@ccsd.ca
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