As a member of the Niagara Poverty Reduction Network and an employee of Project SHARE in Niagara Falls, I sometimes wonder if Canadians are as compassionate as we think we are. We pride ourselves on our good manners and kindness, but then judge our neighbours who may be less fortunate than we are with social assistance rates that make it impossible for someone to have the basic necessities for living.
Social assistance rates in Ontario are surprisingly low. An individual receives a maximum of $7,512 per year, with a shelter allowance of $376 monthly. According to www.rentboard.ca, the average rent for a one-bedroom apartment in Niagara Falls is $970, a difference of $594.
Shocking, but even more so if you compare it to the amount an individual on social assistance received 20 years ago in 1994 – $11,385 annually. At that time the minimum wage in Ontario was $6.70/hour. A full-time employee working 35 hours per week at minimum wage earned an annual income of $12,194, a difference of only $809 annually or $67 per month. Both are low, but the incomes probably covered the basics of food, clothing and shelter back then.
How did rates fall so low?
- 1896-1914: Canada had the world’s fastest-growing economy. Jobs were plentiful so families who needed social assistance in Ontario were primarily helped by religious charities and private groups.
- 1929: The Great Depression started in the United States and changed our way of life when it quickly reached Canada. In the wake of the Great Depression, governments became involved in developing and funding social programs
- 1929-1939: Canada’s gross national product dropped 40% (compared to 37% in the US). Unemployment reached 27% at the depth of the Depression in 1933. Businesses closed as prices fell. Many Catholic women defied Church teachings and used contraception to postpone births— in 1930 the number of births nationwide fell from 250,000 to about 228,000 and did not recover until 1940.
- 1939: The Depression ended as World War II began.
- 1945-1950: After World War II Canada’s population grew rapidly and with it, expanded social services. In the midst of the post-war economic boom the federal and provincial governments began to develop social policy.
- 1950s and 1960s: These decades saw the introduction of programs such as Medicare, the expansion of General Welfare Assistance, and the Canada Assistance Plan (a federal transfer payment program).
- 1970s and 1980s: The following decades saw all three parties raise rates (sometimes substantially). The Ontario PC government under William Davis increased social assistance rates a total of 82%. In total, the David Peterson Liberals raised welfare rates by 54%.
- 1990s: In the early 1990s Bob Rae’s NDP government increased social assistance rates by another 18%. However, by this time Ontario was experiencing a serious economic recession. Unemployment rates were increasing and social assistance recipients swelled to unprecedented levels. By 1993, Ontario provincial revenues were falling and the deficit was climbing. To help curb spending, the Rae government froze social assistance rates.
- 1995: By 1995 both employment rates and government revenues were increasing. Still, as part of its ‘Common Sense Revolution’, Mike Harris’ Conservatives cut the General Welfare Assistance rate by 21.6%. The Harris government also announced that Ontario Works (OW) and the Ontario Disability Support Program (ODSP) would replace existing social assistance programs.
- 2005: Ontario’s social assistance rates remained frozen until 2005 when Dalton McGuinty’s Liberal government began a series of rate increases. Still, according to social policy consultant John Stapleton, it would take a further 57% increase to return rates to 1993 levels.
Where are we now?
The Government of Ontario recently released the new 2014-2019 Poverty Reduction Strategy. The strategy focuses mainly on alleviating poverty through focusing efforts on homelessness. As long as there is a gap of almost $600 between maximum shelter allowance for an individual and average rent for a one-bedroom apartment, this strategy seems as if it may be incomplete. To be effective, the strategy should be linked to meaningful increases in OW and ODSP rates. Individuals and member agencies involved in the Niagara Poverty Reduction Network will continue to advocate for changes that will make our society a more compassionate and gentle one.
Ontario Premier Kathleen Wynne has promised a “fairer society.” Please encourage any clients, friends or anyone you know who may be living on a low income to exercise their right to vote, and vote for change.
For further information about the economic impact of poverty in Niagara, read the 2012 policy brief, “Are the Consequences of Poverty Holding Niagara Back?”