Social assistance rates in the Yukon will increase by 25 per cent under a new government proposal.
About 750 recipients — individuals and families — could have more money in their pockets by the end of the year.
With the major changes, including a decrease in the amount of money clawed back from employed social assistance recipients, the government hopes to move more people off the program and into the workforce.
A government review found nearly 70 per cent of people on social assistance have been on and off the program.
The key is to get people permanently employed and off social assistance, said Health and Social Services Minister Brad Cathers at a press conference.
“The current system encourages dependency,” said Cathers.
The government calculated inflation increases from 1992 to 2006 to come up with the 25 per cent increase, said director of Social Services Michael McCann.
A single person on social assistance can claim up to $1,249 in allowances, up from $1,045. A family of four will see their allowances increase to $2,506 from $2,038.
Allowances include food, rent, utilities, incidentals and clothing.
The new system is one of the best in Canada, said Cathers.
“The earned income exemption puts the Yukon ahead of the rest of the country,” he said.
“It allows people to work more hours and boost their savings.”
People on social assistance who are working will be able to keep $2 of every $4 they make. Previously, people could only keep $1 for every $4 they made.
The three-month waiting period for the exemption will also be eliminated.
This “welfare wall” clawed back paycheques for the first three months of employment.
How much allowance one receives under social assistance is calculated by how much money a person makes at a part-time or full-time job.
“Everything is case specific,” said McCann.
“Your responsibility (as a social assistance recipient) is to bring assets to the table if you’re working. Then we top you up to the threshold.”
Letting people keep more money should help to build up their savings, which the review found to be a big impediment to leaving — or staying off — social assistance.
A little bit of savings will come in handy when a car breaks down or a hot-water heater falters, said Cathers.
“With limited personal savings, a one-time big cost can push a person back onto social assistance,” he said.
The changes will cost $1.7 million annually, but if the new structure works, money will be saved eventually, said Cathers.
“The social services budget will rise in the short term because we’re letting people save more money,” said McCann.
“But long term, more people will be leaving social assistance and we’ll save money.”
Opposition leaders aren’t completely convinced the new system will work, or if it will ever actually be implemented.
“Again, the government’s beginning to get ready to commence something,” said Liberal leader Arthur Mitchell.
Before cabinet can approve the changes, Yukon First Nations and Indian and Northern Affairs Canada must sign-off on the program.
Changes should be in place next month or by January, said Cathers.
A government should announce something when it is ready to do it, not before it knows if it can even move forward, said Mitchell.
“It’s a PR approach to governance,” he added.
If rates are increased, though, then it’ll be an improvement, said Mitchell.
“Anything that allows people to live with more dignity is a positive step,” said Mitchell.
The government is also reducing the red tape for people with severe disabilities who collect social assistance.
Rather than monthly evaluations, they will have to report annually.
Focusing social assistance programs on moving people into the workforce is the wrong approach, said NDP leader Todd Hardy.
“A lot of people think social assistance is made up of healthy, young males who are mentally stable,” said Hardy.
“The pattern of poverty is tough to break out of. This announcement doesn’t look at the broad picture.”
A guaranteed annual income would help get rid of the stigma of social assistance and provide everyone with resources to keep them above the poverty line, said Hardy.
“We need to break free of the whole social assistance structure,” he added.
“The Yukon could be the first jurisdiction in Canada and push others to follow.
“A change in the income clawback is a good start, but the government can’t keep piecemealing social assistance.”