Community &

Neighbourhood Services

Social Services Division

Shirley Hoy, Commissioner

October 19, 1998

To:Toronto City Council

From:Commissioner, Community and Neighbourhood Services

Subject:Update on Municipal Spending for Provision of Benefits to Non-Social Assistance Recipients

Purpose:

The purpose of this report is to update Committee on the continuation of benefits for non-social assistance recipients, and the financial implications thereof.

Financial Implications:

The Department estimates that the cost to Toronto of replacing benefits previously available to non-social assistance recipients under Special Assistance and Supplementary Aid will be approximately $1.526 million at 100 percent municipal cost sharing for the period May to December 1998. Based on 1998 expenditures, the projected 1999 costs will be $1.964 million.

Recommendations:

It is recommended that:

(1)in accordance with the new Ontario Works regulations, the municipality discontinue the provision of benefits under Special Assistance and Supplementary Aid to non-social assistance recipients;

(2)City Council continue to advocate to the Province that the Assistive Devices Program be modified to cover the full costs of medical items formerly covered through Special Assistance and Supplementary Aid; and

(3)the appropriate City Officials be authorized and directed to take the necessary action to give effect thereto.

With the introduction of the new Provincial Ontario Works Act (O.W.A.) regulations, effective May 1, 1998, benefits available through Special Assistance and Supplementary Aid to non-social assistance recipients were eliminated. At its July 16, 1998 meeting, Council agreed to provide 100 percent municipal funding for such benefits until the end of 1998.

This report will identify the projected financial implications of continuing benefits to non-social assistance recipients from May 1, 1998 to December 31, 1998. Subsequently, the report will briefly discuss the concerns related to the continuation of 100 percent municipal funding for these benefits. The implications for people no longer eligible for benefits will also be noted.

Under the former General Welfare Assistance (G.W.A.) Act, low income earners, through Special Assistance, and recipients of other government programs (Canada Pension Plan, Old Age Security/Guaranteed Income Supplement), through Supplementary Aid, could access specific benefits although they were ineligible for G.W.A. Both programs were cost shared by the Province and municipalities at the following ratios: Special Assistance 50/50; Supplementary Aid 80/20. Under the new O.W.A. regulations however, Special Assistance and Supplementary Aid benefits are no longer available to these groups.

Benefits provided through Special Assistance and Supplementary Aid included:

(a)coverage of 100 percent of the cost of approved prescription drugs and drug products for low income earners with high drug costs;

(b)a range of medically based items (hearing aids, prosthetics, wheel chairs and repairs, respiratory equipment and ambulatory aids);

(c)dental and denture needs;

(d)eyeglasses; and

(e)funeral costs (which were cost shared on an 80 Provincial /20 Municipal basis under Special Assistance).

Discussion:

Projected Financial Implications:

Since May 1, 1998, The City of Toronto has continued to provide specific benefits to social assistance recipients who are no longer eligible for assistance as a result of the new Ontario Works Act regulations.

Based on expenses incurred since the beginning of May 1998, the following are projected costs to the municipality of continuing the provision of benefits until December 31, 1998:

(a)Medically based items (including glasses and dentures): $493,100.00

(b)Dental: $2,400

(c)Funerals:$1,380,000 million gross

$ 486,000 recoveries from estates

$ 894,600 net

Therefore, the projected actual budget for 1998, funded 100 percent by the municipality, is $1.526 million.

Concerns Related to Continuing Coverage of Benefits:

As outlined in the July 6^th report to Council on this issue, there exist a number of key concerns if the City of Toronto continues to fund benefits to non-social assistance recipients at 100 percent:

(a)A primary purpose of provincial reform has been to disentangle and streamline the new welfare program by serving disabled people and low income families outside of O.W. Continued funding of benefits to low income families will clearly re-entangle the O.W. program within the City.

(b)100 percent funding of benefits provided under an income redistribution program, such as social assistance, is inappropriate on the property tax base.

(c)100 percent funding by the City is also inappropriate given that the municipal portion of social assistance costs, including administration, are now shared on a pooled basis across the Greater Toronto Area (G.T.A.).

For these reasons, the Department recommends that the City no longer provide benefits to non-social assistance recipients. Given the elimination of Special Assistance and Supplementary Aid under the new Ontario Works regulations, the City currently has no mandate to provide such benefits through the Ontario Works program. Continuation of benefits would also in effect represent a further down loading of Provincial costs onto the municipality.

Conclusion:

In previous reports to City Council, the Department has noted the possible hardship low income earners and people on fixed incomes may face resulting from the Provincial elimination of Special Assistance and Supplementary Aid. Provincial officials indicated that the intention was to serve low income families outside of the Ontario Works program, through existing programs such as the Assistive Devices Program and the Trillium Drug Plan, and through new initiatives such as the National Child Benefit Supplement.

There is a concern that there will be cases in which individuals who are not now social assistance recipients may be forced to give up their employment so they can apply to Ontario Works to retain benefits they previously received. However, given the changes enacted under the new Ontario Works regulations, municipal delivery agents currently have no mandate to provide Special Assistance and Supplementary Aid benefits to non-social assistance recipients. Continuation of benefits would effectively represent a down loading of Provincial costs onto municipalities. For these reasons, the Department recommends that the City no longer provide benefits to non-social assistance recipients.

However, further discussions should be pursued with Provincial officials to seek appropriate authority and cost sharing under Ontario Works to reduce impacts on vulnerable City residents that have been affected by the regulatory changes.

Contact Name:

Heather MacVicar

392-8952

General Manager, Social Services Division

Commissioner, Community and Neighbourhood Services