The 'Welfare Wall'
Hiding the Truth about Poverty
What is the 'Welfare Wall'?
The term 'Welfare Wall' is used by politicians and policy makers to refer to barriers they argue discourage people from leaving social assistance. Usually they are most concerned with the income differential between people receiving social assistance and those earning minimum wage. Put simply, the argument is that unless people earning minimum wage are financially better off than those on social assistance, a 'welfare wall' is created that acts as a disincentive to those on social assistance to find paid employment.
The loss of benefits such as drug and dental coverage when people leave social assistance are also deemed to be part of the so-called 'Welfare Wall.'
The 'Welfare Wall' and the clawback of the National Child Benefit Supplement
Many proponents of the clawback of the National Child Benefit Supplement (NCB from families receiving social assistance insist the clawback is necessary in order to avoid raising the 'Welfare Wall.' They argue that if families on social assistance receive the NCBS they may be financially better off than working families and therefore, would not be motivated to find paid work. Clawing back the NCBS, they say, provides parents with an incentive to find paid work.
Cracks in the Wall
The concept of the 'Welfare Wall' is based on many faulty assumptions. If only escaping poverty was as easy as finding a job!
- People on social assistance are able to work, but choose not to
The concept of the 'Welfare Wall' suggests that people on social assistance simply need to be given adequate incentives to find paid work. The defenders of the concept of the 'Welfare Wall' rely on stereotypes of poor people as lazy, freeloaders who need to be prodded to work. The fact that people on social assistance are unable to work because of disability, childcare responsibilities and lack of marketable skills are concealed by the concept of the 'Welfare Wall.' Additionally, the discrimination that many workers face as they search for work is also concealed.
- Unemployment benefits workers
The concept of the 'Welfare Wall' assumes that people prefer not to do paid work and indeed benefit from being unemployed. The reality is that employers benefit from unemployment because it ensures there is a supply of cheap, desperate labour.
- Jobs are available
The concept of the 'Welfare Wall' implies that unemployment is a result of personal failing, rather than a permanent characteristic of the labour market. In Canada, the unemployment rate right now hovers around 6.5% - and there is no sign that Canada will have full employment anytime soon. Again, a significant unemployment rate helps ensure there are people willing to work in deplorable conditions for poverty wages.
- A job provides an escape from poverty
One in six workers in Ontario are making a poverty wage. Given the low minimum wage and the rise of low-wage, part-time, contract work, increasingly people who are able to find work, remain in poverty.
Hiding the truth about poverty
The truth is that 14.4%* of people in Ontario live in poverty. Most of these people are low-wage earners and/or receiving social assistance. Put simply, the poverty experienced by these people is the direct result of bad government policy that keeps both social assistance rates and the minimum wage dangerously low.
The truth is that the easiest and most just way to eradicate poverty is to raise social assistance rates and the minimum wage to levels which ensure a decent standard of living.
The truth is that poverty is not the result of the personal failings of those struggling to make ends meet, but the result of bad government policy that fails to adequately and fairly address the structural dysfunction of the current labour market.
* Based on Statistics Canada's pre-tax low-income cut-off and data from the 2001 Census.
What You Can Do
Ending the clawback of the National Child Benefit Supplement (NCB would make a big difference in the lives of families on social assistance.
When you’re already living below the poverty line, being able to keep the approximately $115 you get every month for each of your children would go a long way towards paying your bills. But that’s not what happens.
Every month the federal government allows the Ontario government to clawback the NCBS from 163,726 children across the province – simply because their parents are on social assistance. It’s not right.
Tell the federal and provincial governments to end the clawback immediately.
Sign the Petition to Eliminate the Clawback of the National Child Benefit Supplement
Text of Petition:
Dear Prime Minister Harper / Premier McGuinty:
Taking $120 a month from children of families on social assistance is wrong. I am asking you to:
- end the clawback of the National Child Benefit Supplement from families on social assistance, now!
- fund the reinvestment programs that work for low-income families out of other provincial and federal revenues.
- increase the Canada Child Tax Benefit to $4900 a year.