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- CHAPTER 1 - WHAT IS WELFARE?
Chapter 1
WHAT IS WELFARE?
Welfare is the social safety net of last resort in Canada. It provides money to meet the basic needs of individuals and families who have exhausted all other means of financial support.
There are 13 different welfare systems in Canada – one in each province and territory. Sometimes municipalities share responsibility with the province, such as in Ontario. First Nations people on and off reserve receive the same benefits as others, through the welfare program in the province or territory where they live.
Each welfare program has complex rules which regulate all aspects of the system, including:
- eligibility for assistance;
- the rates of assistance;
- the amounts of other income recipients are allowed to keep before welfare is reduced.
Determining eligibility for welfare is a multi-step process. First, applicants must meet the administrative requirements. For example, most have to provide written documentation concerning their financial situation. Administrative rules vary throughout the country. Then applicants undergo a needs test, which looks at their assets, income and basic needs.
ASSETS
In most provinces and territories, the principal residence, defined as a fixed asset, is exempt. However, cash on hand and in bank accounts, is an example of liquid assets, which are not exempt if they surpass a set limit. These limits vary by province and territory according to the size of the household and, in some jurisdictions, the client’s classification.
INCOME
Each province and territory determines how to treat income from various sources (e.g., work, donations) – it may be fully exempt, partially exempt or not exempt at all. Income that is not exempt means welfare payments are reduced by a certain amount.
BASIC NEEDS
Amounts for basic needs, covering items such as food, shelter, clothing, household expenses, transportation, and personal grooming items, are set by government regulation or policy directive. These amounts are often set arbitrarily and do not necessarily reflect the actual cost of necessities. Some provinces and territories – Newfoundland and Labrador, Quebec and Yukon – have recently introduced indexation provisions to prevent benefits from eroding due to inflation.
CLIENT’S CLASSIFICATION
Over the years provincial and territorial welfare programs have defined a general classification of clients, including employable persons, single-parent families, persons with disabilities, persons with multiple barriers to employment, and aged persons. Applicants have to comply with a set of rules, depending on the client categories in which they are placed.