Windfalls..and other shockers.

Many Campbell Riverites are deciding what to do with a $3400.00 cheque coming their way. The current circumstances in B.C., with the worst rate of full-time job losses, the second worst performing economy and the highest level of child poverty in the country defines the outcome for many people in our community who have found themselves on social assistance and waiting for this money.

In the last six months, the number of people on welfare rose 26% to just over 50,000.
Of that, two parent families on welfare increased by 71%.
Why? Job losses mainly. Our employment insurance program is not working, so many unemployed have turned to social assistance and that meager income places demands on food banks and homeless shelters for those who do not have enough money to eat or pay rent. Since a significant portion of people on social assistance have not been on it very long, and at one time had the money to invest in our local CRTV, they will be among those receiving this windfall.

Unfortunately, they will not be permitted the luxury of buying their kids some long overdue clothing, to get that dental work done, paying off the hydro arrears, to do some real grocery shopping for a few months, or to just simply get ahead.

In 2002, many of the incentives and earnings exemptions that came along with receiving social assistance were eliminated. You could no longer keep a portion of your child support ($200.00) or earn some money on the side ($200.00)without it being deducted dollar for dollar. Monetary gifts or goods in kind, honorariums, or any earned or unearned monies not issued by welfare had to be reported and were now deducted dollar for dollar from their next welfare check. Transportation costs during the first month of a new job – gone. A “transition to work” benefit of $150.00 a month to assist with childcare, work clothing, transportation costs for the first year of employment – gone.

A single person on welfare in our community who is classified as “expected to work” receives up to $610.00 a month. A two parent family with three kids receives up to $1151.06.

So imagine yourself in a position you are not used to, trying to pay for everything just to maintain a basic standard of living. Then imagine you cannot do that anymore on your current welfare income, and suddenly you cannot shop in every aisle of the grocery store anymore, your kids are wearing last year’s shoes, bill collectors call you every day, your whole family is depressed, and you are basically living in struggle and starve mode. Now you are about to find out the light at the end of the tunnel this month has been switched off.

The Ministry of Housing and Social Development has announced that the share dividends from the sale of CRTV are considered unearned income. There are no earnings exemptions for this kind of unearned income for recipients of social assistance and as such the money will be deducted dollar for dollar. The income has to be reported. If it is not reported, and you receive your welfare cheque the next month, and following months, you will be in an overpayment situation. There is no discretion to apply exemptions to this income and dividend income will show on your income tax records so the Ministry will eventually be notified you got it, and sanctions would likely be applied against you for trying to rip them off by trying to live with some dignity for a change.

Most people will only lose their next month’s welfare income so have to budget for that out of the money they receive. However, depending on a family’s circumstances, and what they currently have in “assets”, there could be some recipients who are impacted beyond the following month if the dividend money puts them over their asset level (single person: $1500.00, Couples or one/two parent families: $2500.00, Disabled person: $3000.00, Couples or families with one disabled person: $5000.00). You could not receive a welfare check for quite some time and be expected to live off the money at the rate you get on welfare. In other words, your life continues to suck.

This situation applies to those who are receiving provincial disability benefits as well so any plans you had to improve your daily living with medical, dental, or nutritional extras are probably going to have to be cancelled.

There is just cause to shed a light in this dark tunnel on the fact that in 2002 when the social safety net was taken apart, the Deputy Human Resources Minister was offered a $15,400 bonus for cutting welfare numbers by 2% her first year on the job. She was also asked to come up with policies to reduce the number of people receiving disability assistance. This bonus would have topped her $154,000 salary. While welfare rolls were cut by 26% (and homelessness went up) she was not able to figure out a way to stop people with disabilities from qualifying for supports so she only got part of the bonus.

In 2007, Gordon Campbell voted himself a 54% pay raise which took his annual salary to $186,000.

I guess they have to get the money from somewhere.