Canada’s Social Safety Net A Backgrounder Civics Studies 11/Social Studies 11 MUNDY 2008

Social Safety Net Refers to the programs and policies in place by a government meant to alleviate the effects of poverty Social Safety Net programs allow ALL people to receive income, health care and other Examples of programs include: pension plans, medicare, employment insurance, etc. Also known as “demogrants”

Pension Plans Pensions are given to people who are of retirement age (65 and older) as a source of income Given that many cannot find work due to health issues, income cannot be generated any other way Only some had family that could take care of them – others had immigrated to Canada, while some died in WWI

Pension Plans First introduced in 1927 during King’s minority government as coalition with Progressive Party Basic pension = $240/a Had to prove hardship through test Only to British subjects who had lived in Canada 20 years or more 70 years and older

Pension Plans 1951 – Old Age Security Act Granted $40/mth - taxable 70 and older Directly administered by Federal Government Also created Old Age Assistance Act for those (also $40/mth) Jointly funded by feds and prov. gov’ts

Pension Plans In 1964, became the Canada Pension Plan (in Quebec, the Quebec Pension Plan) While rate before this had been raised to $75/mth, still not enough for cost of living Thus, new program required workers to contribute monthly to CPP Would receive about 25% of average salary upon retirement

Pension Plans In 1975, spouces of contributors to pension plan were allowed to receive benefits of partner’s plan Currently payments have been reduced

Employment Insurance Monthly payments for those who have recently lost their job and are looking for work Meant to give minimal income during time searching for new employment so that person will not lose house, car, etc. Once person is in new job or not found work beyond a certain time, payments end

Employment Insurance 1940 – created Unemployment Insurance Before this, unemployed applied for payments from municipal gov’t. From 1940, UI administered federally People may claim by showing proof of employment between 420 – 700 hours (max $413/week) Now called Employment Insurance

Family Allowance A monthly allowance given to families in order to assist them in raising children Amount determined by number of children in household

Family Allowance First introduced in 1945 Amounts based on age: Under 5yrs old = $5/mth, 6-9yrs = $6/mth, etc. Payments were non-taxable and each family received benefit regardless of income

Family Allowance In 1978, this system was revised to become Refundable Child Tax Credit Families with incomes under $18000/a received $200/a Families over $26000/a received nothing In 1992, program became $85/mth max for children up to 18 based on low- income Child expenses were tax-deductible, though

Minimum Wage First introduced in 1920’s both federally and in various provinces in response to workers’ strikes (including Winnipeg General Strike) Federal minimum wage is set for federal employees, while provinces set provincial minimum wage for all other employees working within province (usually lower than federal level)