Wynne's First Budget - More Austerity and Deeper Poverty

2013-2014 Ontario Provincial Budget Breakdown by OCAP

OCAP had no great expectations that the 'Social Justice Premier's' first Budget would give poor communities in Ontario much reason to celebrate. We are surprised, however, at just how shamelessly she has continued to push people into deeper poverty. Wynne, like McGuinty before her, is obsessed with ‘eliminating the deficit’ at all costs. It is clear from the government’s own figures that corporate greed created this deficit, but the people of Ontario will be expected to pay for it. In the 2013 budget, they boast of reducing corporate taxes by $8.5 billion per year since 2009 and proudly announce that Ontarians now get less per capita funding from their government than people in any other province.

The vital question was whether social assistance rates would be raised in a way that began to repair the incredible loss of real income that has taken place since 1993. The measures taken in this budget leave no room for doubt. The great majority of people on social assistance will get a 1% increase, which is, of course, a cut when you consider the rate of inflation. To put this in real terms, consider that in 2013, landlords can raise rent by 2.5%, but social assistance rates are only going up by 1%. Single people on Ontario Works, whose income has declined by 56% since the 90s, will receive $14 a month over and above this. Their income will increase by perhaps 3%, which means they will pretty well stay where they are against inflation. This comes shockingly below the $100 raise recommendation of their own commission.

In last year’s budget we saw the elimination of the Community Start-Up and Maintenance benefit as well as a cap on health related benefits. This will continue in to 2013-2014 meaning that as the money runs out on the municipal level, there will be no fund available for people trying to get housed. The cut to CSUMB has already created a crisis in homelessness and housing and overall funding to municipalities was reduced to even deal with the maintenance of shelters and basic life-saving supports. There is no question that the cut the CSUMB, and the inability to restore that cut in this year’s budget, will cost many more homeless lives and put more people at risk of homelessness and violence.

For people living on minimum wage, whose wages have been frozen for three years, all that is promised is an advisory panel. Whether your poverty comes in the form of a social assistance cheque or a pay cheque, Wynne's brand of 'social justice' ensures you will be poorer in 2013 than you were in 2012.

The only measure that will be of some modest help to people on social assistance will be the improvements in the rules around earnings and assets. The claw back on these will be now somewhat less severe – people can keep the first $200/month they earn, but above that it will be clawed back 50%. However, these tiny measures can't even begin to compensate for the government's decision to put the weight of eliminating the deficit on the backs of the poor.

This is a brutal budget, but we are fully aware of the fact that bigger attacks are being prepared. The government wants to move in the direction set by the SARC (Social Assistance Review Commission) Report and, we have no doubt, fully intends to download ODSP and organize a massive attack on the disabled that will force them to compete for the lowest paying jobs on offer. The proof of this plan to move people off ODSP and into low wage work is clear in this budget which moves the Accessibility Directors from the Ministry of Community and Social Services to the Ministry of Economic Trade and Employment.

We note, finally, that the government is continuing to push its stale ritual of consulting us to death on 'poverty reduction' even as it increases and deepens poverty. They will create a Cabinet Committee to work towards implementing the measures laid out in the SARC report, which echoes much of Drummond’s austerity blueprint. They brag about having increased OW and ODSP rates by 15% since 2003 – that is actually them admitting to cutting welfare rates by approximately 10% when inflation (average 2.5% per year) is taken into account. Surely, this budget must remove the last possible illusions about where the Liberals and ‘social justice’ Wynne stand. Only if we challenge their real agenda of austerity and poverty can we defend our communities from the cutbacks they are preparing.

Key Highlights

• Deficit projected at $9.8 billion. Corporate tax cuts alone have contributed $8.5 billion or approximately 87% of this deficit. The tax cuts have not created new jobs – unemployment remains high, at 7.7%

• Ontario now spends less on programs per capita than any other province

• Cabinet Committee will work this year to implement the austerity recommendations of the SARC report, most of which echo the Drummond report. If the government follows through on these plans, 2014 will likely see major, devastating changes to social assistance, especially ODSP.

• Social assistance rates will increase by 1%, with a top up of $14 for single people on OW. This is less than inflation, so it is a cut when cost of living is factored in.

• Everyone on OW and ODSP can now keep up to $200 per month of their earnings, but earnings above $200 will be clawed back by 50%.

• Single adults can now keep $2500 of their assets when going on to OW. Couples can now keep $5000.

• Government is working hard to push people with disabilities into low wage work. Committed to working with private sector to find jobs for people on ODSP – given how inaccessible society is, these will mostly be low paying, precarious jobs.

• They are moving ahead with 60% of the austerity recommendations in the Drummond Report

• Government boasts of keeping public sector wages down. Promises to freeze wages until deficit is eliminated. Looking to cut 1500 jobs from public sector.

Read the full budget document here: http://www.fin.gov.on.ca/en/budget/ontariobudgets/2013/

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We Demand:
1) Reverse the Cuts, Raise the Rates 55%!
2) Restore Community Start-Up and Maintenance Benefit and the Special Diet Allowance!
3) Raise Minimum Wage - $14 Now!

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Or contact us at: Ontario Coalition Against Poverty
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