Poverty Awareness in York Region

TheStar.co
March 05, 2007

Laurie Monsebraaten
Staff Reporter

Myriam Canas-Mendes loves her job as an outreach worker at the Stop Community Food Centre where she organizes public forums, connects recent immigrants to government services and helps out in the centre's breakfast and lunch programs.

The pay is between $10 and $12 an hour depending on the task. That's considered fair by advocates who are pushing Queen's Park to raise the provincial minimum wage to $10 from $8.

The problem is the single mom of two doesn't get enough hours to make ends meet. And so the 34-year-old Canas-Mendes has to rely on welfare to supplement her income.

Except that doesn't provide enough money to live on either.

Welfare does include basic health benefits – which her part-time job doesn't offer. But it denies her $226 a month in federal child benefits that she would receive if she were able to get full-time hours.

It's a vicious circle. And it traps people like Canas-Mendes and her family in poverty.

About 33,000 Ontarians – or roughly 15 per cent of the 220,000 adults on welfare – report some earned income and are in the same boat as Canas-Mendes, according to provincial social services data from last September. About 165,000 children on welfare are affected by Ontario 's policy of clawing back federal child benefits.

What can be done?

One solution gaining momentum is a guaranteed annual income for all Canadians.

Green Party Leader Elizabeth May floated the idea earlier this year during a party convention in Vancouver . Respondents to a recent National Council of Welfare survey listed it as one of the top priorities for the federal government.

And a Toronto task force last spring recommended a basic income to help the growing numbers of low-income adults living in poverty. Most recently, Tory Senator Hugh Segal – a long-time proponent of a guaranteed annual income – told delegates to Toronto 's city summit alliance conference last week that he believes Canada has the money to ensure every Canadian can live with dignity.

"When we look at the billions we now spend on social policy, it's clear we have the capacity," he told a workshop.

At the University of Waterloo , sociologist Sally Lerner is among a passionate group of Canadian academics who back a guaranteed annual income.

"A basic income would put a floor under every single man, woman and child," says Lerner, who co-authored a book on the subject in 1999. "Think of it as a secure place to stand from which to build."

What's the holdup?

Part of what's holding back a guaranteed annual income is perception and language.

"People don't like the idea of entitlement," says John Stapleton, who was part of last spring's Toronto task force on Modernizing Income Security for Working-Age Adults. "When they hear guarantees they think of rights without responsibilities."

If income is not tied to work – or even a desire to work – there's a worry people will simply choose to not get a job and we'll end up with labour shortages, he explains.

But if that happens, employers would have to make jobs more attractive by providing better pay, hours and working conditions, says economist Mike McCracken, president of Informetrica, an Ottawa-based economic consulting firm.

Any worry about looming labour shortages as baby boomers retire and our birth rate stagnates is also a red herring, he says.

A non-taxable basic income of about $1,000 per month for every adult would give retired people an incentive to work, since the current Old Age Security and the Guaranteed Income Supplement for seniors is heavily taxed if seniors earn any extra income, he says.

"A basic income would restore the employer-employee power balance which has shifted away from workers since the early 1990s when Ottawa began denying unemployment insurance to those who quit," he says.

The big price tag of any guaranteed program is also a factor. And some worry governments would set the income so low people wouldn't be further ahead.

But with cuts to employment insurance – less than half of Canadian workers now qualify – and welfare rates that are as much as $10,000 below Statistics Canada's low-income level, it's hard to imagine how any program could be worse than the status quo, says University of Regina sociologist Jim Mulvale. Mulvale, who championed the issue during the Green Party convention in January, is hoping Saskatchewan 's NDP government may pick up the idea at a conference he's organizing in Regina in June.

Targeted Options

Even progressive thinkers have some reservations. Ken Battle of the Caledon Institute for Social Policy likes the idea of a basic income. But he believes poverty needs more than a "one-size-fits-all" solution.

"The notion of a single program that could help everyone ignores the needs of the disabled, seniors and children," he says. And it doesn't address problems faced by recent immigrants, the seasonally unemployed or unskilled workers in precarious jobs, he adds.

Battle would rather build on existing programs. As examples, he cites:


Raising the National Child Benefit to provide low-income children $5,000 annually – up from a maximum of $3,243 this year.

Higher minimum wages with increases linked to inflation, beefed-up employment standards, plus federal and provincial income supplements and tax credits for low-wage workers.

For working adults like Canas-Mendes, an overhaul of the welfare and employment insurance systems.

For all workers experiencing temporary unemployment, Battle suggests federal income-tested benefits funded out of general revenues.

For the unemployed who need to upgrade their skills, he suggests provincial income and training support.

For working-age adults unable to work due to age or health problems, a basic income could be paid by Ottawa as a limited form of guaranteed income.

The scheme would allow provinces to focus on employment and training and make Ottawa – with its larger tax base – responsible for basic income support for both seniors and working age adults.

What's Next

Toronto's income security task force, sensing political resistance to reforms, opted to leave the current welfare and employment insurance system alone.

Instead, it recommended a minimal basic income of $150 per month for all working age adults living below Statistics Canada's low-income level. And it suggested another $200 per month for those who earned a specified income.

Combined with their earnings, the measures would provide an income floor of about $15,000 for the working poor – roughly what the neediest senior currently receives from Ottawa .

In January, child poverty activists wrote Ontario Premier Dalton McGuinty urging him to introduce an Ontario Child Benefit in the budget to help low-income parents like Canas-Mendes whether they rely on welfare or not.

And federal Finance Minister Jim Flaherty is expected to bring in a working income tax benefit, to boost low-income workers' wages. That could also help her.

For economist McCracken, this shows it's just a matter of time before Canada gets a guaranteed annual income.

"I've always felt Canada will move in this direction gradually," he says, adding the child benefit, in effect, is already a form of guaranteed annual income for kids.

For Canas-Mendes, who pays $750 a month for a damp basement apartment and sees half her earnings clawed back by welfare, change can't happen soon enough.

"I want to make something of myself," she says. "I want to be an example for my children so that they can live a better life."