: Supporting a Fair Society

BACKGROUNDER

Ministry of Finance

Supporting a Fair Society

November 17, 2014

Ontario’s path to a balanced budget will help ensure that services and supports, which allow every Ontarian the opportunity to work and contribute to the prosperity of their province, are protected and sustainable over the long term.

The government is expanding its efforts in poverty reduction to continue building opportunities for all Ontarians.

Progress to Date

According to the most recent data available:

  • The children’s poverty rate in Ontario fell to 13.6 per cent in 2011 from 15.2 per cent in 2008
  • 47,000 children were helped out of poverty
  • Without the government’s poverty reduction strategy, the rate would have been 15.9 per cent in 2011.

This progress has been notable as it happened during the global economic recession and ensuing slow recovery.

The Ontario Child Benefit (OCB) has made a direct and lasting impact by helping to lift children out of poverty:

  • In July, the maximum annual benefit increased by $100 to $1,310 per child, enhancing the incomes of more than half a million families
  • Beginning in July 2015, the OCB’s maximum benefit, and the income threshold at which the OCB starts to be reduced, will be indexed to annual increases in the Ontario Consumer Price Index, safeguarding the OCB’s purchasing power from erosion due to inflation.

A Renewed Strategy

In September, the government released a renewed poverty reduction strategy, Realizing Our Potential.

A sustained, flexible and results-driven approach to poverty reduction, the strategy focuses on four objectives:

  • Breaking the cycle of poverty for children and youth and recommitting to the target of reducing the child poverty rate by 25 per cent
  • Moving towards greater employment and income security
  • Investing in affordable housing and ending chronic homelessness in the long term
  • Using evidence to develop policy and measure success.

The renewed strategy supports and encourages people to find meaningful employment at a fair wage, and continues to focus on providing opportunities for youth and vulnerable populations so that they develop the skills and experience needed to enter the labour market.

Health Benefits

To help ensure that no parent has to choose between work and social assistance to improve the health outcomes for their child or children, the government will expand access to health benefits for children in low-income families, including:

  • Prescription drugs
  • Assistive devices
  • Vision care
  • Mental health services.

Student Nutrition Program

The government is also expanding Ontario’s Student Nutrition Program so children and youth in more low-income neighbourhoods and on First Nation reserves have access to nutritious breakfasts, snacks and lunches.

  • During the 2012–13 school year, the program served nearly 700,000 school-aged children and youth.
  • The expansion of this program will serve an estimated 56,000 more children and youth in higher-needs communities.
  • An initial investment of $32 million over the next three years will establish 340 new breakfast programs in elementary and secondary schools and enhance some existing student nutrition programs.

The Role of Employment

While government supports play a major role, employment is key to further reducing poverty.

According to 2011 data, in Ontario households where no one is employed, the poverty rate was
60 per cent. With one full-time worker employed all year, the poverty rate dropped to about
10 per cent and with two or more full-time workers employed all year, the rate fell to about one per cent.

To support and encourage everyone to find meaningful employment at a fair wage, the government has:

  • Raised the minimum wage to $11 per hour, the highest among the provinces
  • Passed legislation to index the minimum wage to the Consumer Price Index so it keeps pace with the cost of living
  • Provided opportunities for youth, such as the Ontario Youth Apprenticeship Program, to graduate with a high school diploma and partial completion of a qualification in a trade
  • Begun improving employment and training services to better assist the most vulnerable, including those receiving social assistance, persons with disabilities, the long-term unemployed, Aboriginal peoples, newcomers and at-risk youth.

Because of the importance of employment to poverty reduction, the government will monitor and report on three new indicators:

  • Youth not in employment, education or training
  • Adults in long-term unemployment
  • A vulnerable-persons poverty rate.

Investing In Affordable Housing and Ending Chronic Homelessness

The government’s long-term commitment on ending chronic homelessness will require a multi-faceted approach that includes investing in effective programs and services today and developing strategies that help end chronic homelessness over the long term.

The Province’s Long-Term Affordable Housing Strategy is ensuring vulnerable Ontarians remain appropriately housed by investing in homelessness prevention and affordable housing.

The government is updating its strategy by 2015–16 so that policies and programs are relevant to current realities and reflect new research and a best practice approach to poverty reduction.

New Initiatives

  • A $42 million investment in the Community Homelessness Prevention Initiative allows local governments to use tailored funding to develop programs for those who are homeless or at risk of becoming homeless in their communities.
    • The new investment, announced in the 2014 Budget and rolled out in October, brings total investment in this program to $294 million annually and will further improve access for those in need.
  • A renewed Investment in Affordable Housing cost-matching agreement with the federal government signed in August.
    • The agreement is expected to provide more than $801 million in new funding across Ontario over the next five years and allow local governments to create and repair affordable housing and to provide down-payment and rental assistance to households in need.
    • The program also provides funding assistance to the off-reserve Aboriginal community as well as northern Ontario’s remote areas.

Supporting Ontarians with Developmental Disabilities

In the 2014 Budget, the government committed to investing an additional $810 million over three years to improve supports for adults with developmental disabilities – and their families – to help these adults live as independently as possible and to fully integrate into society.

As of October, the government has helped adults with developmental disabilities by:

  • Expanding direct funding to more than 6,000 children and their families through the Special Services at Home program and nearly 1,900 adults through the Passport program
  • Expanding residential supports to 350 additional adults, including vulnerable young adults who are transitioning from children’s services
  • Creating a Developmental Services Employment and Modernization Fund to modernize service delivery and increase employment opportunities for people with developmental disabilities
  • Forming a Housing Task Force, consisting of key stakeholders in the developmental services and housing sectors, to recommend innovative housing solutions for adults with developmental disabilities.

Increased Legal Aid Eligibility

On October 30, Ontario announced it is moving forward with a plan to increase the eligibility threshold for legal aid services, allowing an additional one million low-income Ontarians to qualify for legal aid services – more than double the number eligible for legal aid services today.

Specifically, the plan would allow Legal Aid Ontario to issue approximately 75,000 additional certificates each year, enabling legal representation for low-income Ontarians. The 2014 Budget included an initial investment of $95.7 million to increase the income eligibility threshold by six per cent in each of the first three years of the plan. The first increase took place on November 1, 2014.

Taking Steps to Keep Auto Insurance Affordable

Government reforms aimed at fighting fraud and abuse are making auto insurance more affordable for Ontarians. As a result of the government’s Auto Insurance Cost and Rate Reduction Strategy, rates declined by more than six per cent on average from August 2013 to August 2014.

Initiatives

  • To date, the government has addressed over half of the recommendations made by the Auto Insurance Anti-Fraud Task Force, including key proposals to enhance the Financial Services Commission of Ontario’s investigation and enforcement authority and make it easier for individuals to report suspected auto insurance fraud.
  • Licensing of health service providers in the auto insurance system, a key Task Force proposal, will become fully effective on December 1.
  • The government is also committed to establishing a Serious Fraud Unit, whose mandate would include addressing auto insurance fraud.
  • Bill 15, the Fighting Fraud and Reducing Automobile Insurance Rates Act, 2014, continues the government’s efforts to protect consumers and combat fraud as part of the strategy. If passed, Bill 15 would:
    • Transform Ontario’s auto insurance dispute resolution system to help injured drivers settle disputed claims faster
    • Regulate the towing and vehicle storage industries through measures that tackle questionable practices
    • Give the government authority to change the current 60-day period that a vehicle can be stored after an accident, accruing charges, without notice to the owner.
  • An interim Transparency and Accountability Report on the impact of auto insurance reforms to date was released in April 2014, and in November 2014, the first annual Transparency and Accountability Report was delivered to the Minister of Finance.

Rates are linked to claims costs and further action to reduce costs and uncertainty in the auto insurance system is needed to achieve the government’s 15 per cent average rate reduction target. The government will continue to review additional possible reforms, but it is also important for the insurance industry to help keep auto insurance affordable.

Electricity Rate Mitigation for Low-Income Ontarians

The government recognizes that Ontario’s low-income households typically spend a proportionately higher percentage of disposable income on electricity compared to high-earning households.

Initiatives

  • The Minister of Energy has asked the Ontario Energy Board to develop options and provide a report by December 1, 2014 on a sustainable, long-term electricity support program, the Ontario Electricity Support Program (OESP), specifically designed for low-income Ontarians, to be in place by January 1, 2016. The OESP would replace the Ontario Clean Energy Benefit once it ends December 31, 2015.
  • The government is also moving forward with removing the Debt Retirement Charge cost from residential users’ electricity bills after December 31, 2015. This will save a typical residential ratepayer about $70 per year. Implementation details will be set out in a draft regulation expected in early 2015.

FOR MEDIA INQUIRIES ONLY:
Susie Heath, Minister’s Office, 416-325-3645
Scott Blodgett, Ministry of Finance, 416-325-0324

ontario.ca/finance-news
Disponible en français