Social Assistance Reform in Ontario and Recipients with Disabilities: The coast is (un)clear

Earlier today, the Ontario government announced its framework for changes to social assistance for people on Ontario Works (OW, commonly understood as welfare) and for people on the Ontario Disability Support Program (ODSP).

So, what does this all mean, for ODSP recipients in particular?

“The goal is to transform the welfare program into the job-connection service it is supposed to be,” writes Randell Denley of the National Post.

That is, similarly to the previous Liberal government’s Brighter Prospects report in 2012, the focus is on employment (I gave my (skeptical) views on “Pathways to Employment” before).

For people on ODSP who are working, the government’s plan to provide an annual exemption of $6000 on income is welcome – but then, there’s the clawback of 75% of every dollar of income past that point, as opposed to 50%; the rationale here is not clear.

[1 December 2018 update: Ricardo Tranjan of the Canadian Centre for Policy Alternatives writes, "The Ontario government is increasing the employment earnings exemptions for both programs. From $200 to $300 a month for OW and from $200 monthly to $6,000 annually for ODSP. This measure would have been a positive change, if the government had not raised clawback rates on earnings above these amounts from 50% to 75%. [...] [Social] assistance recipients will be taxed more on their employment incomes as a result of these changes.”]

That the threshold was actually reduced for people on OW – from $400 per month to $300 per month, from what the previous government was planning – is curious, given that the supposed intent of the exemption in the first place is to incentivize workplace participation. As the Toronto Star notes, “[Those] on welfare will see their benefits reduced by 75 cents for every additional dollar they earn instead of the current 50 cents. That means people will hit the point that they’re no longer eligible for welfare sooner; ultimately, that may reduce the incentive to seek more work.”

For those who receive ODSP benefits, I suspect this change will not lead to a massive increase in their long-term participation in the workplace.

The core challenge, in my view, is the inaccessibility of the workplace for so many.

People with disabilities have many skills, passions, and much motivation – but not the flexible, open, and inclusive spaces to enable them to use them, and get paid fairly for doing so.

Other commitments made include:

Redesigning ODSP to consolidate complex supplements and benefits into simplified financial support for people with severe disabilities. 

Many recipients will testify that the system for accessing benefits is indeed complex. But what constitutes “simplification”?

As the Income Security Advocacy Centre writes regarding as-yet-to-be-defined “Health Spending Accounts”, “It is not clear whether this new amount will replace current mandatory and discretionary health-related benefits that help people access items like diabetes supplies, incontinence supplies, medical travel, and other necessities. No information is available for how much this benefit will provide, how people will qualify for it, and how they will access it.”

That is, “simplification” could result in a block grant to pay for services.

Yet as people who run out of entitlements for paramedical services in employer-sponsored plans well know, a block can be good – provided the the money lasts.

What would be truly unfortunate is if entitlements to services where recipients do not have to pay out of pocket are removed. Recipients are particularly financially vulnerable, and faced with the obstacle of paying for a service they can no longer afford, may have to turn to charitable organizations for funding, or do without.

Providing clarity to the system around who qualifies for ODSP in the future and looking at aligning Ontario’s new definition of ‘disability’ more closely with federal government guidelines.

This is interesting in that what constitutes these “federal government guidelines” is not clear.

Indeed, earlier this year, the Senate issued a report calling for broader criteria for determination of the Disability Tax Credit.

This suggests that eligibility for ODSP – even though present Program recipients will be grandfathered – may become more restrictive.

What is most telling is what was not in the framework: information on potential future increases to ODSP rates.

Commitments to better link needed services are welcome in theory – but details are not provided.

As the last line of the framework reads, “More details about the changes to social assistance will be available in the coming months.”

So, in sum:

Some signals – but no details.

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