In Canada, adult citizens are expected to be as economically independent as possible. Whether a person can be self-sufficient depends on the individual’s capacity to work, on opportunities for employment or self-employment, and sometimes on other circumstances. Often as a result of a combination of factors, there are occasions where people find themselves in financial need and without a personal resource to turn to. Social assistance (sometimes also referred to as “welfare”) is a form of public benefit that is designed to help people in financial need. Its purpose is not to address poverty as such, but rather to prevent extreme economic hardship or destitution.
When Saskatchewan was created in 1905, people in need were expected to rely on family, friends, or charitable organizations. As the provincial economy and social relationships became more complex, governments gradually assumed more responsibility for helping individuals in need. While the first social assistance programs in Saskatchewan were organized by municipal governments, this service is now provided by the province, with partial and indirect financial support from the federal government. The way most people in Saskatchewan get income for their personal or family needs is through employment or self-employment. Like most developed countries, Canada has a series of social security measures that protect economically vulnerable people such as children or the elderly, or reduce the negative impacts of misfortunes such as illness, injury, or unemployment. Social assistance is intended to provide last-resort income support in the absence of other sources of income from employment or social insurance.
Because it is a last-resort source of income support, social assistance uses a “budget deficit” system for determining eligibility for benefits. An estimate of the individual or family’s basic needs is constructed, based on family size and composition. The household’s income resources are then compared to the budget, and if a deficit exists, this amount is the benefit. This approach to benefit eligibility is also sometimes called “needs-testing.” Some other qualification rules may also apply. Applicants are expected to explore all alternatives to social assistance, particularly work (“employment-testing”). Those with more than a modest level of cash, real estate, vehicles, or other possessions may be considered ineligible because the asset may be deemed a resource available for current needs (“asset testing”).
The budget-deficit system means that the applicant’s other income sources generally result in benefits being reduced dollar for dollar. There are some exceptions, such as partial exemption of employment income, a policy that is intended to encourage employment activities. There is considerable debate in social policy circles about the effectiveness of earnings exemptions compared to other approaches to encouraging employment and self-sufficiency. Social assistance has tended to be a controversial program. The availability of an unearned cash benefit from government is seen by some as a work disincentive; in fact, there is practical evidence that long-term reliance on social assistance may erode peoples’ capacity and will to be self-sufficient. While social assistance ensures everyone’s basic needs are met in the short term, some believe it is also a factor in reinforcing poverty and economic exclusion. It is therefore important that social assistance be closely connected to employment services and other supports that help people restore their capacity to support themselves.
As the last line of defense against financial need, demand for social assistance tends to be affected by major trends in social and family arrangements, and by cycles in the labour market and the economy. A long-term upward trend in caseloads occurred between the 1970s and the early 1990s, with generally declining demand from that time forward as the Saskatchewan and federal governments adjusted cash benefit and other programs to encourage employment. As controversial as such programs may be at times, basic income support programs like social assistance are an important component of our social security system. They are one of the means by which we enforce an implicit social contract among citizens of Saskatchewan: that we do not allow members of our community to suffer extreme deprivation for reasons beyond their control. Carefully designed and managed, social assistance and other basic income support programs can prevent destitution and help economically marginalized people move back into the mainstream of the community.