Recent Trends in Social Protection Policy and Social Determinants of Health: The Case of Ontario Arne Ruckert, PhD Institute of Population Health

Outline Ontario’s transition from welfare to workfare Current discussions about welfare reform (Review Commission) Policy suggestions for future welfare reform Ontario’s austerity budget of 2012 and its impact on welfare policy and programs Recent trends in social determinants of health

Context Welfare policies and programs are an important determinant of health (Lundberg et al., 2008; Bradley et al., 2011) Globalization’s (financial crisis) impact on welfare reform Recent acknowledgement that welfare reform is sorely needed in Ontario (window of opportunity)

Welfare Reform in Ontario Ontario moves from welfare to workfare regime in 1995 with introduction of Ontario Works (OW) and Ontario Disability Support Program (ODSP) Erosion of cost-sharing between federal and provincial government through introduction of block funding Rescaling of welfare provision to local level with no national standards Reduction in welfare rates (21.6 per cent cut in 1995, frozen from 1995 to 2005) and cut to various community services Tightening of eligibility criteria, cut in asset limits, and introduction of bureaucratic barriers

How does workfare work (OW)? Qualify based on income and asset limits Participation Agreement (PA) Receive financial assistance (depending on family situation) Participation in employment assistance activities While on workfare, you also qualify for prescription drug and dental coverage; eyeglasses ;diabetic supplies; special diet allowance; moving or eviction costs; and employment-related costs

Historical Trend in Ontario

Main concerns with Ontario workfare approach Lack of monitoring and evaluation of its success Complexity and opacity of rules Often ignores current labour market conditions Issue of forcing people into programs or activities (micro-conditionality as form of governmentality) Loss of benefits when transitioning into low-income work, aka welfare wall Not enough emphasis on job training and active labor market policies Inadequate level of financial support

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Review of Social Assistance in Ontario Poverty reduction strategy launched in 2008 Poverty reduction act made law in 2009 Social assistance review is a major component of this strategy Review Commission provides feedback on how to: establish an appropriate benefit structure simplify income and asset rules to improve equity ensure the long-term viability of the social assistance system define Ontario’s position vis-à-vis the federal and municipal governments as it relates to income security for Ontarians.”

Findings from Review Commission “The limited focus on skills development in social assistance, along with the precariousness of the labour market, mean that recipients who exit social assistance do not escape poverty and are forced to cycle through periods of receiving and not receiving social assistance” “Empirical studies in Canada have found that while many recipients are able to leave social assistance permanently for employment, some are not able to retain sustainable employment or escape poverty. As a result, a portion of recipients with multiple barriers, including those with young children and limited education, receive social assistance for longer periods or return to social assistance”

Suggestions by Review Commission (inside the system) Merge OW and ODSP with focus on individualized employment services and work ability spelled out in Employment Plan Raise social assistance rates and simplify benefits structure (building block approach) Municipalities should manage program and deliver services, with input from employers Level of employment support should be in line with experienced need (multiple barriers will lead to more intensive support) Remove certain benefits from social assistance and make available to all low-income Canadians (health, housing, child care, disability…)

Suggestions by Review Commission (outside the system) Poor job market in Ontario affects people’s ability to exit social assistance Elaborate human capital development strategy Address increasing income inequality Make tax-transfer system more effective (with consolidation of provincial and federal tax benefits) Reverse downward pressure on wages (work must pay)

What’s left out by the Commission? Need to raise government revenues (tax load 13% of GDP in Ontario in 2009; total revenues 16.3% of GDP) Need for better and more comprehensive active labor market policies Inappropriate asset restrictions need to be lifted Universal childcare Provide tax incentives or raise minimum wage to make work pay

Ontario’s austerity budget of 2012 Austerity budgets will likely undermine SDHs as existing health inequities will be further amplified through the implementation of various cutbacks in welfare programs Cutbacks to affordable housing programs (both at federal and provincial level) The Ministry of Municipal Affairs and Housing’s Operational Budget was cut to $585.5 million for 2012, a 12% reduction from fiscal 2009 (operating funds subsidize affordable housing) Ontario’s long-term affordable housing strategy, adopted two years ago, puts municipalities at the forefront of housing and homelessness policies

Welfare reform (social assistance) Removal of Community Start Up and Maintenance Benefit and Home Repair Benefit from social assistance programs Cut in social assistance rates (in real terms) $500 million cut to education budget, including cuts to programs that will undermine health equity (low-impact grants that fund programs such as parenting and family literacy centres) Special Dietary Supplement Cut Cutbacks in transfers to municipal level (Windsor)

Some SDH trends in Ontario Affordable housing waitlist at all time high (more than 150,000 Ontarians, up 17.7 per cent from 2009) Core housing need (CMHC) at 13% in Ontario Food insecurity at highest level ever; HungerCount 2011 results indicate a staggering 25.7% increase in food bank use in Ontario between 2008 and 2011 (close to 900,000 users a month in Canada), with a 37.5 per cent increase for those under the age of 18 (Canada Food Banks 2011) Poverty levels on the rise (from 11.3 to 13.1 per cent in 2009 using LIM, a staggering growth rate of 17% since the beginning of the financial crisis)

Conclusion Window of opportunity to make progressive changes to Ontario welfare regime Wide-spread agreement about needed reforms and policies Health inequities will deepen further unless austerity agenda is stalled Without external mobilization, we will see further welfare retrenchment in Ontario, despite recommendations by Review Commission