On July 12, Jamie Swift, Director of the Justice, Peace and Integrity of Creation Office of the Sisters of Providence of St. Vincent de Paul submitted a brief to the Social assistance Review Commissioners during their visit to Kingston.

 The full brief can be found under the Social assistance tab on this web site. The following excerpts relate to the issues of deep poverty and working poverty as discussed in the brief. 

 Working Poverty

The Commission’s Issues and Ideas background paper indicates that “the nature of work in Ontario is changing.” More precisely, however, work in Ontario has been changing  for a generation. The rise of a contingent or just-in-time labour market in the expanding service sector has been recognized since the 1980s. This is a fundamental reason for the rise of poverty and social inequality in the province. Even if a single person has a full-time, year-round job at minimum wage, their income will still be more than a thousand dollars below the poverty line. One in three Ontario children living in poverty were part of families with full-time, year-round work. (LICO-BT) However, many people trapped in the contingent labour force do not have these kinds of jobs, forced as they are into taking fewer hours whenever they can. We must understand that many employers have a stake in this labour market model for the simple reason that they benefit from the low-wage, just-in-time workforce.

Issues and Ideas asks how the needs of employers can be addressed. It asserts that “understanding employers’ needs is critical” in matching employment services to those needs. It is important to locate the interests of different economic sectors here. The largest financial institutions have produced important research on social assistance inadequacy.Toronto’s Board of Trade has promoted social inclusion, better public housing and transportation policy, more green jobs. But the mainstream of the business community has not been conspicuous by its presence in advocacy efforts aimed at improving employment opportunities for people receiving social assistance. This does not mean that efforts to reform the social assistance system should ignore the needs of employers. But it does mean that we must recognize that different economic sectors have different interests. Firms offering contract security and custodial services are likely to offer poverty level wage while major firms in resource, finance and manufacturing offer jobs with decent wage and benefit packages.

For this reason, it is up to government to do two things. 1) Play a facilitating role by engaging employers as partners, assisting them by matching employment services to employer needs. 2) Government also needs to play a stronger regulatory role by developing and enforcing labour standards that protect workers from employers seeking to take advantage of  their vulnerability in the face of ample labour supply and the structural changes mentioned above. Newcomers to Canada, uncertain about their rights and fearful with respect to their immigration status, are particularly vulnerable. (see Swift, J. et al, Persistent Poverty: Voices from the Margins,  Toronto: BTL, 2010, esp. Chapter 15 “It’s not my Country Yet…”) According to the Workers Action Centre’s  2011 report Taking Action Against Wage Theft,

The Commission needs to take the real world of the labour market — fraught as it is by very real imbalances in power — into account in formulating its recommendations with respect to working poverty. The Commission can remind government in the strongest possible terms that it has an ethical responsibility to ensure that full time work enables earners to receive incomes above, not below the poverty line. This would add momentum to the living wage campaigns currently underway in several Ontario communities, including Kingston.

The Commission also needs to promote an activist approach to social assistance grounded in the principle that it is ethically irresponsible for the government to claw back incomes of social assistance recipients who have managed to secure modest labour market incomes, at least until such time as their total income exceeds the poverty line. A job needs to be a real ticket out of poverty.

Deep Poverty

If a job is currently no guarantee of a ticket out of poverty, social assistance as presently structured guarantees a continuing cycle of hunger and hardship. The Commission’s Issues and Ideas paper acknowledges that people on social assistance cannot afford healthy diets. (This means that the poor get sicker, quicker, with substantial costs to the state — see Persistent Poverty, above, ch. 10 and 12 and a substantial body of scholarly research.) The paper also notes the “difficult trade-off” between allowing people on social assistance to eat well (“providing adequate levels of support”) but doing so “without creating barriers to work.” This balancing act is an example of pragmatism in action. It reflects an assumption, common among many economists, that people are rational actors who will choose dependence on state support over labour market participation because of the ostensible benefits offered by the former choice.

The situation of a single adult in Ontariois a case in point. The program known as “Ontario Works” provides this person with $7,325 annually, just less than 40 per cent of the poverty line (LIM-AT) income of $18,582 annually. This translates into a basic income gap ($11,230) that dwarfs this person’s income. A single parent with one child receives $16,683 on Ontario Works just short of two-thirds of the poverty line. The pragmatism that would have us believe that people choose social assistance over employment assumes that life below the poverty line is somehow bearable. It is not based on evidence, nor an appreciation of the real life experiences of low-income people in Ontario. Those experiences show that a complex set of issues – including unaffordable housing, inadequate child care, low wage work, illness and disability – characterize life on what recipients call “benefits.” The dizzyingly complex maze of rules governing social assistance, of which the Commission will hear, springs from the assumption that poor people will cheat the system and, like chronically misbehaving children, are in need of control. The system’s punitive character is underlined by the fact that Ontario Works requires applicants to divest themselves of virtually all their assets in order to qualify for benefits.

If the Commission were to address but one issue, it would be to put to rest the notion that low-income people depend on the state because they prefer social assistance to working. That said, it is important to recognize that rich countries with vibrant, competitive economies (Scandinavia and the Netherlands) have been able to design systems of public provision for their most vulnerable citizens that, by and large, keep them from falling into poverty. Countries like the U.S.and the U.K., with social assistance regimes more akin to the Ontario model, can hardly be held up as examples of economic success. Indeed, they are characterized by structurally high levels of inequality and poverty. While questions of broad economic and social policy are beyond the scope of the Commission,  the northern European countries show clearly that there are alternatives.

The first step in improving Ontario’s social assistance system is the immediate introduction of the $100 per month Healthy Food Supplement as promoted by the Put Food in the Budget Campaign. As we have indicated, progress in poverty eradication is achieved when citizens act collectively in promoting the common good. It is due to the efforts of a province-wide political advocacy effort that the Commission has come into being. The immediate implementation of the Healthy Food Supplement would not only be an  important, if modest, step in alleviating suffering and promoting healthier diets. It would also validate and encourage Ontario’s movement for social justice – the principal force for poverty eradication in the province.

We would also urge the Commission to consider the crucial role played by housing costs in perpetuating poverty in Ontario. Kingston presents a classic case study in the housing affordability crisis. Census data from 2006 show that nearly half (48 per cent) of Kingston households spend over 30 per cent of their income on shelter. Equally shocking is that over one in five households (21.79 per cent) spend half or more of their income on shelter. We urge the Commission to recommend implementation of a full housing benefit to limit rental costs for single adults and families living on low incomes to 30 per cent of gross household incomes. Finally, we urge the Commission to develop a meaningful plan for the elimination of deep poverty aimed at ensuring that no one on social assistance is forced to try to live on an income of less than 80 per cent of the poverty line (LIM-AT).

We believe that these suggestions are feasible and realistic in a rich society such as our own. The Commissioners, experienced in government and public life, will be aware that government is about making choices.Ontario can choose to eliminate hunger, homelessness and hardship. Other affluent societies have achieved the virtual eradication of poverty. We can too.