Sound footing for welfare reform -  Minimum-wage workers below poverty line  -  Canada: Deepening poverty and economic insecurity

Sound footing for welfare reform
CAROL GOAR
 

Deb Matthews hopes to "blast to smithereens" the stereotype of a welfare recipient as a lazy, able-bodied bum.
 

The rookie MPP from London is on a province-wide tour to find out what's wrong with Ontario's social assistance system, what can be done to fix it and how it feels to live on welfare.
 

She's only halfway through her 12-city journey, but she's sure of one thing: No one wants to stay on welfare. It's a miserable, degrading existence. And politicians have made it worse by stigmatizing those who need help.
 

"We can't tolerate this," Matthews says. "We've been putting down people on social assistance for too long.
 

"I think our government should be judged on how well we help our most vulnerable citizens."
 

These are welcome words, coming from Queen's Park after nine years of shrinking welfare payments, punitive rules, humiliating eligibility tests and snide cracks about beer-drinking welfare mothers and drug-addicted handout seekers.
 

Matthews, who is parliamentary assistant to Community and Social Services Minister Sandra Pupatello, asked for this assignment. She wanted to overhaul a part of government that was clearly out of step with her values and those of her party.
 

Her report will not be ready in time for next week's budget. Nor will it call for a massive infusion of cash, to the dismay of many anti-poverty groups.
 

Matthews' objective is to produce a 10-year blueprint for social assistance reform, identifying steps the government can take immediately and longer-term changes.
 

"It's going to be easier to write than I thought because the themes that are coming through are so strong and consistent," she says. "The people who work in the system know what needs to be done."
 

The first imperative, Matthews says, is to rid the system of the crude stereotypes that are preventing caseworkers from dealing with the real-life problems that clients face.
 

"There is no one-size-fits-all solution," Matthews says. "These are people with a variety of barriers in their lives. Otherwise, they wouldn't be on social assistance."
 

Unfortunately, many of the stereotypes that Matthews is talking about — the selfish freeloader, the negligent single mother, the would-be cheater — are built right into the $240 million computer program designed for the previous government by the multinational consulting firm Accenture.

Whoah! $240,000,000.00 for a lousy database program, which is seriously flawed?   Perspective, this could have been spread around , seed money for a business or project -- hey, fewer in need of welfare!!

How many Canadians does Accenture employ?  So we starve while this consulting firm lives the high life?  I suspect this is why public schools taught new math, so they could sneak these right by everyone's noses!

I am livid (rapidly becoming my natural state).  If anyone is in position to get some answers... (Ed.)

Matthews won't say what she thinks the ministry should do with its costly, judgment-laden software, but she notes with a smile that front-line workers in many communities have found ways to outsmart it.
 

The second thrust of her report will be that the system is overburdened with onerous rules, time-consuming verification procedures and excessive documentation.
 

"Our caseworkers spend too much time photocopying and not enough time giving people the help they need," she says. "They have stayed in the system because they want to do social work, not paperwork."
 

Matthews will recommend that the government simplify its convoluted application process, speed up the delivery of benefits and free caseworkers to treat clients like human beings.
 

Her third message will be that individuals need support, not lectures or coercion, to move from social assistance to work.
 

That means affordable housing, accessible child care, transit fare, job training and drug and dental benefits. In the case of immigrants, it means help getting Canadian work experience. In the case of clients with health problems or addictions, it means finding proper treatment and counselling.
 

"When things fall apart, it's never just one problem," Matthews says. "Everything the government does is linked."
 

Her final argument will be that public attitudes have to change.
 

It is simply wrong, Matthews says, to equate poverty with laziness, irresponsibility or failure. It is unacceptable to look down on people who need social assistance. Most are coping with nightmares the comfortable majority could barely imagine.
 

Matthews' research began in Scarborough on April 14 and will end in Chatham in early June. By then, she will have heard from roughly 200 social assistance recipients, local caseworkers, ministry officials, low-income advocates, employers and labour representatives.
 

"We're pretty excited about some of the things we'll be recommending," Matthews said. Whether they'll be adopted, who knows?
 

Although she has only been a member of the Legislature for seven months, Matthews has credentials that will give her proposals extra weight. She is president of the Ontario Liberal Party. Her brother-in-law is former premier David Peterson. She chaired the party's election campaigns in 1987 and 1995.
 

Matthews doesn't want to raise unrealistic expectations. She is a backbencher and money is tight.
 

But she can promise the province's poorest citizens that their views will be reflected in whatever she submits, their dignity will be respected by her government and their lives will start to get better.
 
 

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Carol Goar's column appears Monday, Wednesday and Friday.

Minimum-wage workers below poverty line:
study By DARREN YOURK Globe and Mail Update

Full-time minimum wage workers in major cities of Canada's four most populous provinces are living well below the poverty line, a new report says.

The National Council of Welfare, a citizens' advisory body to the Minister of Human Resources Development Canada, released a report Monday that says government initiatives aimed at moving people off the welfare rolls are leading to low paying full-time jobs that aren't helping people get out of poverty.

"People on welfare must have the resources not just to survive, but to work and get back on their feet," council chairman John Murphy told a press conference in Ottawa. "And it is only fair if full-time work moves people out of poverty."

The report looks at the 2000 earnings of types of low-income families in British Columbia, Ontario, Alberta and Quebec against Canada's most used measuring sticks for poverty.

None of the minimum wage workers made more than Statistic Canada's low income cut-offs or LICO (the level where people have to spend disproportionate amounts of their incomes on food, shelter and clothing) and most fell short of the federal government's market basket measure (MBM) which shows the number of Canadians unable to afford a collection of goods -- food, clothing, shelter, transportation and sundries such as telephone service and postage stamps -- set as the minimum standard for decent living in Canada.

"It is disappointing to the council - but no surprise - to find that provincial governments continue to set welfare rates at levels that simply do not allow any welfare recipient to maintain the most basic standard of living," the report says.

"It is even more shocking to see that the situation for minimum-wage workers is only a relatively minor improvement from welfare."

The take-home pay of minimum wage earners in Ontario was not enough to bring them over either measure of poverty.

The single employable person earned just 92 per cent of the MBM and 83 per cent of the LICO. The single parent with one child earned 92 per cent of the MBM and 95 per cent of LICO. The couple with two children reached the MBM and 93 per cent of LICO.

In Alberta, where minimum wage was the lowest in Canada, the single employable worker earned 91 per cent of the MBM and just 73 per cent of LICO.

The single Albertan with one child earned 82 per cent of the MBM and 75 per cent of LICO. A couple with two children was the only family to earn above a poverty line earning 110 per cent of the MBM but only 91 per cent of LICO.

British Columbia had the highest minimum wage rate in the country for the year, but workers and their families failed to rise over either poverty line.

The single employable worker earned 91 per cent of the MBM and only 84 per cent of the LICO. The single parent with one child earned 84 per cent of the MBM and 88 per cent of the LICO. The couple with two children also came close - earning 98 per cent of the MBM and 93 per cent of the LICO.

The situation was better in Quebec, with low-income earners getting assistance from GST and QST credits, the Canada Child Tax Benefit and Supplement and the Quebec Family Allowance.

The single employable person working full time at minimum wage earning 112 per cent of the MBM and 83 per cent of the LICO. Single parents with one child was the only family type to earn above both poverty lines, earning 132 per cent of the MBM and 112 per cent of the LICO. The couple with two children earned 127 per cent of the MBM and 97 per cent of the LICO.

"The National Council of Welfare believes that there is no reason for anyone in a country as wealthy as Canada to live without the basics to stay healthy and to have the resources to get back into the work force," the report says.

"In our view, welfare programs exist to support people when they are down on their luck. The programs must ensure that people are safe and healthy and have the resources to get back on their feet."

The council makes a number of recommendations in the report, including raising minimum wage, providing tax relief, income supports or "top-ups" to low-wage earners and ensuring that there is an adequate supply of safe and affordable housing.

Source: http://www.globeandmail.com/servlet/story/RTGAM.20040503.wwelfare0503/BNStor y/National/

Canada: Deepening poverty and economic insecurity for working families
By Lee Parsons World Socialist Web Site 9 April 2004

A recently released report from the Vanier Institute of the Family documents what is apparent to most families in Canada that have struggled over the past decade to make ends meet: their ranks are swelling and their situation is worsening. According to the Institute’s fifth annual report on “The Current State of Canadian Family Finances,” a record number of families are “Living on the Edge”—that is, on the precipice of poverty.

Much of the analysis in the “Family Finances” report is based on data Statistics Canada collects for federal government but that is seldom brought together. Released in February, the report shows that while the economy has expanded rapidly over the past 15 years and the incomes of the rich and well-to-do have swelled, ordinary Canadians have experienced a decline in real hourly wages—a decline that has been offset only by working longer hours, drawing down savings and going ever deeper into debt

“What has been good for the economy,” states the report, “has not been as good for the majority of households.” Among the principal changes in social life over the past decade is that “A growing number of households are now ‘living on the edge’ brought about by the triple reality of shrinking real hourly wages, the continued growth in household spending and rising debt loads.”

The report suggests that the mounting debt-loads are financially unsupportable in the long run and that the increasing workload is producing major stresses on family life.

“The decline in real hourly earnings,” declares the report’s author, Roger Sauvé, “has pushed more people into the labour market. This is especially so for families with children. By 2001, some 83 percent of married couples with children had two or more earners...a new record high. The percentage of female lone-parent families with at least one earner soared to 82 percent...another record high. It seems that parents take the costs and responsibilities of raising children very seriously. In the process we may have created ‘workaholic’ families where more and more adults, and in many instances the youth, are in the paid workforce. Increasingly, the choice between working at a paid job or not doing so is driven by financial necessity...the financial ‘edge’ is just too close.”

While the 25-page report points to the increasing hardships falling on working people due to the decline in the real value of hourly wages, as well as the real value of welfare benefits and of the minimum wages set by the federal and provincial governments, it makes no criticisms of government policies or big business. Utterly ignored is the drive by corporate Canada and the entire political establishment, from the Conservatives to the social-democrats of the NDP, to boost profits and investment by attacking the social position of the working class through union busting, contracting out, social spending cuts and changes to fiscal policy aimed at rewarding the well-to-do. The report thus presents the increasing hardships facing working people as the outcome of amorphous and mysterious market forces, not the class struggle.

Anything else would, frankly, have been surprising given the nature of the Vanier Institute. Founded by former Governor-General Georges Vanier and his wife, Pauline, in the mid-1960s, the Institute is a charitable organization dedicated to promoting policies for the “well-being of Canada’s families.”

Nevertheless, the report makes some significant points.

Hanging on through debt

It warns, for example, that a key factor driving the economic recovery of the past decade has been rising consumer debt: “Household spending has, in fact, helped keep the economy growing during the last few years. But, this economic growth has come at a high price.

“Hourly earnings are shrinking. A record number of people are now employed. The personal savings rate has now fallen to an all-time low. Debt has now risen to an all-time high. Bankruptcies remain at near-record highs. Over the last few years, only the top fifth of families have seen their share of the total income pie increase. The other 80 percent of families have seen their shares shrink or have merely held on to what they had. Many of these families have already fallen off the ‘edge.’ The biggest losers have been the poorest 40% of families.”

At the outset of the report, Sauvé points out that although incomes may have risen slightly and official poverty rates declined in some areas, such figures “mask some fundamental problems that families and households are experiencing today or will confront tomorrow.” Measured in constant 2001 dollars, average hourly earnings that rose slightly during the 1990s have fallen sharply—more than 3 percent—over the past four years. In addition, “more family members are now holding down paid jobs and more of them are working longer hours.”

It should be noted in examining reports of this sort that the numbers used are based on ‘averages’ that often obscure the growth of extremes at either end of the income scale. It is to the author’s credit that, while necessarily relying on such statistics, he attempts to give a more truthful picture of the real impact of recent changes on working families. Although not explicit until near the end of the report, he there states that “References to percentages, poverty rates and low-income cut-offs tend to soften the reality of poverty. Behind all of these numbers and measures are real people who are suffering real hardships.”

This characterization is substantiated with figures showing that since 1989, when 2.7 million Canadians were deemed to be living in poverty, that number grew to over 3.1 million by 2001.The statistics show that although there has been some decline in the numbers of poor children in recent years, there has been a marked increase in the number of adults living in poverty. Many of these are the “working poor,” people struggling in minimum-wage or near-minimum-wage jobs.

The author raises a critical question over how economic health is measured as it affects working families. “GNP growth tells us nothing about the extent of economic and social security.... [T]he growth of household incomes was not anywhere near as robust as GNP growth, and was fuelled by a growth in jobs rather than by a growth in real wages. In other words, working families have mainly increased their incomes by working longer hours.”

Alongside the increasing hardship faced by workers is the growth of wealth at the upper end of the income scale. Throughout the last decade and a half, government income transfers through social programs and other measures fell sharply as a proportion of national income while corporate profits grew at the expense of wages and salaries. “In 1989, the average after government transfer and income tax incomes of the richest 20 percent of families was 4.8 times the average income of the poorest percent of families. This rose to a new high of 5.5 times by 2001.”

Answers?

If the strength of this report is the focus it brings to contrasts between overall economic growth and the declining fortunes of working families, its greatest weakness is in offering any remedy to growing economic insecurity and deepening social polarization. Aside from warnings that the situation is growing more dire, the author apparently sees no way out of the situation other than to advise the working poor to spend less and save more. This is hollow counsel to those whom Sauvé admits have increasingly narrow choices.

The growth of new technologies and the rise in productive capacity are in fact pregnant with progressive possibilities. The means exist to provide a decent standard of living to all and reduce the work-burden for individuals and families, but for that to be realized economic life must be radically reorganized under a workers’ government that would make the meeting of social needs, not the accumulation of individual profit, the animating economic principle.

Source: http://www.wsws.org/articles/2004/apr2004/cana-a09.shtml

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