Tammy Schirle is an Associate Professor of Economics at Wilfrid Laurier University
It's one short line in the Ontario 2012 Budget that sounds fairly innocent: "The government is not proposing any increases to social assistance rates at this time." While the media has focused on wage freezes and collective bargaining in the public sector, I have not seen much concern for those who rely on social assistance. Perhaps most people don't care.
Social assistance rates are not extravagant – they are designed to meet the most basic needs for survival. A single individual in Ontario may receive $599 per month in assistance; a single parent with one child may receive $1,023 per month.
Just like wage freezes, welfare freezes result in a real reduction in living standards if the inflation rate is positive. Those experiencing wage freezes will need to cut back on luxury items. Unlike public sector wage freezes, those experiencing welfare freezes will need to cut back on basics like food.
Think of a basic $100 grocery list – this should buy a week's worth of basic groceries. This past year, food prices increased by 3.7 per cent, so we might expect that same bag of groceries to cost $103.70 a year from now. But with the welfare freeze, you won't have an extra $4, so you have to cut something – perhaps eat less meat and more macaroni, or simply skip one more meal a week.
It's often difficult to understand the circumstances that put someone on the welfare rolls – I certainly haven't known any child who dreamed of becoming a social assistance recipient when they grow up. Most popular criticism of social assistance recipients tends to focus on the few who abuse the system – perhaps that makes some people feel better about their position in society and making cutbacks like this. But each welfare recipient's story is unique, and I tend to simply accept that some people need our help.
If looking to reduce the cost of social assistance, the province should look at constructive long-term strategies for reducing the number of welfare recipients. For example, research (by David Green and others) has shown that high school graduation among the children of welfare recipients significantly reduces the child's likelihood of becoming a welfare recipient in adulthood. This is particularly important for kids coming from the most troubled family backgrounds.
A creative provincial budget would think about long-term investments that reduce reliance on social assistance. Forcing someone to skip lunch seems counter-productive.
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