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TORONTO – Without government action, the lack of adequate income security programs could plunge Ontarians suffering the worst of the current recession into dire straits, says a report by the Canadian Centre for Policy Alternatives (CCPA).
Silence of the Lines: Poverty Reduction Strategies and the Crash of 2008 shows how the economic downturn is already worse than the Great Depression but predicts different results for Ontarians who end up down on their luck.
“During the first three years of the Great Depression in Ontario, relief expenditures tripled and old age pension costs doubled,” says author John Stapleton. “But this time around, Ontarians will find the door is closed on them for Employment Insurance and welfare. They’ll be forced to empty all their assets and take on low paying work.
“Unless our governments act swiftly, unemployed factory workers will find themselves pouring coffee at coffee shops – or worse – with nowhere else to turn.”
The report shows a surprising lack of movement in Ontario’s welfare rolls to date.
“Social Assistance caseloads spiked in the 1990s, jumping from 6% of our population in 1989 to a record high 12.4% in 1993,” Stapleton says. “But caseloads today are only at 5.6% of population – about as low as they were in the late 1980s and throughout the post war period when times were better.”
The report points to restrictive EI and welfare eligibility criteria, predicting the ‘new poor’ in Ontario’s current recession will be forced to raid their RRSPs, their savings, and other nest eggs in the absence of government assistance.
Among his recommendations to prevent devastation reminiscent of the Great Depression, Stapleton says governments should: reform EI and social assistance, improve the working income tax benefit, improve housing benefits, and provide a new base income of $1,000 a month to all single persons while increasing disability benefits to $15,600 – the same as low income seniors receive.
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