________________________________________________________________________________
CONCLUSION

________________________________________________________________________________

The National Council of Welfare has tracked welfare rates since 1986. In all those years, we have had very little opportunity to announce any good news. From the beginning, the Council was concerned about how low welfare incomes were. Welfare incomes have never reached the poverty line for any family type at any time anywhere in Canada.

But the news got worse. In 1990, the federal government opened the door with its infamous "cap on CAP," cutting the federal transfer program that supported the welfare system in Ontario, Alberta and British Columbia. In the early 1990s, the economic recession opened the door a little further. The federal, provincial and territorial governments took the opportunity to make wholesale cuts to the welfare system. By the mid-1990s, several provincial and territorial governments embarked on a series of welfare reforms that made the system more demeaning for even less support. Despite increasing awareness of the importance of early child development and the damaging effects of child poverty, families with children on welfare were not spared when governments cut social programs.

The one ray of hope was the federal government's investment in the Child Tax Benefit. The Council was encouraged to see that the federal, provincial and territorial governments identified income support for poor families with children as one of its priorities when it issued its Report to Premiers of the Ministerial Council on Social Policy Reform and Renewal in March 1996. We were encouraged to learn that the two levels of government were prepared to put aside their differences and create a new system for improving the situation of families with children.

We were very pleased to learn that the federal government's investment in this new program would be substantial. When the new Child Tax Benefit was announced in 1997, the federal government committed $850 million a year. The 1998 budget announced a further $425 million a year beginning in July 1999 and another $425 million beginning in July 2000. As of July 2000, the total commitment by the federal government is worth $1.7 billion a year.

After years of cuts to social programs, the Child Tax Benefit represented a major effort to improve the conditions of poor families with children. Unfortunately, the new arrangement came with a condition that allowed the federal government's support to bypass the families that needed the money the most: those families with children that were forced to rely on welfare. What the federal government gave, the provinces and territories could take away.

When the Child Tax Benefit was negotiated with the provinces and territories, the federal government allowed the provincial and territorial government to take part of the money away from those low-income families that rely on welfare. The money the provincial and territorial governments claw back must be reinvested in programming related to children, but the criteria for these reinvestment programs is loose. Programs that are funded by the money that is clawed back from families on welfare do not necessarily reach families on welfare. Another condition was that those families whose welfare income was clawed back by the amount of the supplement to the Child Tax Benefit were supposed to be no worse off.

66

 

Only Newfoundland and New Brunswick decided not to exercise the option of taking money away from families on welfare. Manitoba announced that it would no longer take awat increases in the supplement to the Child Tax Benefit as of July 2000.

This year's edition confirmed our fears about the clawback. Welfare incomes for families with children have declined across the country – except in the two provinces that chose not to claw back the supplement to the Child Tax Benefit. In all cases, the federal government is now paying a greater share of welfare incomes than ever before, but welfare incomes remain far, far below the poverty line. While the federal government poured money into efforts to reduce child poverty, the provinces and territories were allowed to syphon it off.

Not only did the money bypass the families that needed it the most, the value of welfare incomes for families declined. No provincial or territorial government that cuts its welfare costs by letting the federal government pick up more of the tab was going to raise welfare rates for families with children. Inflation eroded the value of welfare incomes and families ended up worse off than before.

The Council has seen no convincing evidence that taking money away from the poorest of poor families provides will motivate parents to enter the work force. What we know helps parents to provide for their children are a series of family supports such as job training, better minimum wages, and labour policies that help parents to balance their responsibilities to their children with their responsibilities to their jobs. Good, integrated family policy must also include early child development programs that provide the best possible early education for children while providing the dependable, affordable child care that allows parents to participate in job training and to take jobs.

The National Council of Welfare has expressed its deep concern about the clawback on many occasions. In our opinion, any program that is intended to support poor families, but bypasses the poorest families has missed the boat. Until the federal government puts a stop to the clawback, the value of the federal government's enormous investment in this important source of family support is badly compromised. The National Council of Welfare still has hope that the National Children's Agenda can plug this leak.

When the federal budget was announced in February 2000, we were disappointed that the federal government chose to defer action on the Children's Agenda until the end of this year. When the Children's Agenda is finally announced – and we hope that this will be soon – the National Council of Welfare will be looking to see that supports go to the families who need help the most, those families with children who are so poor that they are forced to depend on welfare. Ending the clawback to the Child Tax Benefit should be among the first items of business in any serious effort to provide family supports.

 

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TABLE 8, ESTIMATED NUMBER OF PEOPLE ON WELFARE

 

MARCH 31
1993

MARCH 31
1994

MARCH 31
1995

MARCH 31
1996

MARCH 31
1997

MARCH 31
1998

MARCH 31
1999

% CHANGE
1998-1999

NEWFOUNDLAND

68,100

67,400

71,300

72,000

71,900

64,600

59,900

-7,8%

PRINCE EDWARD ISLAND

12,600

13,100

12,400

11,700

11,100

10,900

9,800

-11,2%

NOVA SCOTIA

98,700

104,100

104,000

103,100

93,700

85,500

80,900

-5,7%

NEW BRUNSWICK

78,100

73,500

67,400

67,100

70,600

67,100

61,800

-8,6%

QUEBEC

741,400

787,200

802,200

813,200

793,300

725,700

661,300

-9,7%

ONTARIO

1,287,000

1,379,300

1,344,600

1,214,600

1,149,600

1,091,300

910,100

-19,9%

MANITOBA

88,000

89,300

85,200

85,800

79,100

72,700

68,700

-5,8%

SASKATCHEWAN

68,200

81,000

82,200

80,600

79,700

72,500

66,500

-9,0%

ALBERTA

196,000

138,500

113,200

105,600

89,800

77,000

71,900

-7,1%

BRITISH COLUMBIA

323,300

353,500

374,300

369,900

321,300

297,400

275,200

-8,1%

YUKON

2,500

2,400

2,100

1,700

2,000

2,100

1,700

-23,5%

NORTHWEST
TERRITORIES

11,100

11,000

12,000

11,800

12,800

10,700

11,300

5,3%

CANADA

2,975,000

3,100,300

3,070,900

2,937,100

2,774,900

2,577,500

2,279,100

-13,1%

Source: Social Program Information and Analysis Division, Social Policy Directorate, Human Resources Development Canada

68

 

TABLE 9, POVERTY LINE, 1999 ESTIMATE

NATIONAL COUNCIL OF WELFARE ESTIMATES OF STATISTICS CANADA'S
LOW INCOME CUT-OFFS (1986 BASE) FOR 1999

FAMILY
SIZE

COMMUNITY SIZE

 

CITIES OF
500,000

100,000-
499,999

30,000-
99,999

LESS THAN
30,000

RURAL

1

16,766

14,727

14,386

13,115

11,414

2

22,726

19,963

19,501

17,775

15,474

3

28,888

25,375

24,787

22,595

19,666

4

33,262

29,211

28,539

26,017

22,642

5

36,339

31,918

31,180

28,424

24,741

6

39,446

34,643

33,845

30,852

26,855

7 +

42,426

37,265

36,404

33,186

28,884

Based on inflation rate of 1.7%.

 

TABLE 10, POVERTY LINE, 2000 ESTIMATE

NATIONAL COUNCIL OF WELFARE ESTIMATES OF STATISTICS CANADA'S
LOW INCOME CUT-OFFS (1986 BASE) FOR 2000

FAMILY
SIZE

COMMUNITY SIZE

 

CITIES OF
500,000+

100,000-
499,999

30,000-
99,999

LESS THAN
30,000

RURAL

1

17,068

14,992

14,645

13,351

11,619

2

23,135

20,322

19,852

18,095

15,752

3

29,408

25,832

25,234

23,001

20,020

4

33,861

29,737

29,053

26,485

23,050

5

36,994

32,492

31,741

28,936

25,186

6

40,156

35,267

34,454

31,407

27,338

7+

43,190

37,936

37,059

33,783

29,404

Based on estimated inflation of 1.8%

 

69


      
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