Forward, backward, sideways...

Social activists outside Québec will have been impressed by the Action Plan and by the impact of the Act to Combat Poverty and Social Exclusion that mandated its publication. How could it have ever happened without such a law that a right-wing government invests, during its first year in office, the better part of $2.5 billion in direct improvements to the revenues of people living in poverty ? They will have noted the rather exemplary transformation of families’ taxation into a universal system of family allocations, with a sizable component assigned to low-income families, along with the distancing from the workfare approach that predominates almost everywhere else in North America.

As for Quebec activists, they will have also noticed the lack of specific targets for covering the basic needs of life and for escaping poverty, the deterioration of the revenues of the poorest, the insufficient protection of welfare benefits, the incoherence of banking on employment as an exit route from poverty without tackling the conditions affecting the working poor, including a minimum wage that would allow people to escape poverty, and without budgeting the necessary labour market measures.

Add to this the vagueness of several of the announced measures, the lack of answers to very urgent inexpensive demands such as re-establishing free medication for welfare recipients, the failure to implement the monitoring mechanisms stipulated in the Act, and the plan’s utter silence concerning citizen involvement. And finally, the mañana syndrome : almost all the interesting measures will only be implemented in 2005, or even further down the road.

Indeed, all of these assertions are true of Concilier liberté et justice sociale : un défi pour l’avenir, the long-awaited government Action Plan to Combat Poverty and Social Exclusion and its attendant budgetary measures, published last April 2, 11 months after the date stipulated in the Quebec Act to Combat Poverty and Social Exclusion. In summary, several steps forward, backwards, and sideways.

Better and worse

The Action Plan offers a very imperfect response to the Act’s stipulations. Yet, it will effectively improve the lot of thousands of people. However, this improvement will be selective, with measures ranging from better to worse along the “good poor/bad poor” symbolic axis that underlies so much prejudice. The better part is that the improvements will mostly benefit minimum wage families with two children, who will see their disposable income improve by $5,030 in 2005, mainly through new measures such as the Soutien aux enfants (Children Support) ($1,750 more) and Prime au travail (Employment Premium) ($2,750 more), for a total disposable income of $26,790. An improvement that will truly register in these families income, but one that will be undercut by the losses of services and rate hikes during the preceding year.

As for its worse part, the plan will hurt the poorest of the poor : childless welfare recipients deemed able to work but without employment earnings. These will see their income deteriorate further because of the decision, deliberately taken as a work incentive, to only index their already too low benefit by half of the rate selected for other households. Their annual income will only improve by $36 in 2005, with their monthly benefit going from $533 to $536, triggering a further loss of purchasing power.

Who can live in Quebec with so little money ? Let us be reminded that the basic welfare benefit, which amounted to $440 in 1985, should now be worth over $700 in 2004 if its purchasing power had been maintained. Successive failures to index this benefit have devalued it by default. It is unconscionable that an action plan deemed to combat poverty should enshrine this practice, contrary to the law, which stipulates that the income and living conditions of people must progressively improve. The government will have given priority to work incentive measures over the coverage of essential needs. A costly decision in terms of social justice perception and public health.

Toward the next generation of social and fiscal programs ?

To have the current social and fiscal regime evolve towards a Quebec without poverty would have called for the following major changes in terms of individual revenues and their interdependence in the production and distribution of wealth.

  1.Guaranteeing that welfare benefits will be maintained at their current level, protected from any further reduction through cutbacks or penalties.
  2.Upping welfare benefits to a socially acceptable level in order to cover essential needs (basic level) and safeguarding this threshold from any reduction.
  3.Setting the minimum wage at a socially acceptable level to allow a single person working full-time to escape poverty (poverty exiting level).
  4.Upping the federal and provincial null taxation thresholds to the poverty exiting level (thrugh targeted tax reduction measures).
  5.Supplementing personal revenues that fall between the basic needs of life coverage threshold and the null taxation threshold through various forms of public aid (e.g. training supplement, workplace insertion, activity, multiple income).
  6.Improving individual and corporate fiscal regime progressivity in order to adequately finance public spending. This to be completed, of course, by quality public services and by common welfare protection and development action measures, provided by a State acting as a steward of solidarity mechanisms, including solid labour standards.

Quebec’s Action Plan and recent budget show the start of systemic moves on some of these six points but in discontinuous and disorderly fashion, creating both advances and possible counter-effects. No coverage threshold or poverty exiting thresholds are being set. Such benchmarks are therefore lost and their attainment abandoned to the haphazard progress of individual incomes. For instance :

  1.Penalties for turning down welfare measures are eliminated, but benefits are not safeguarded from any cutback. Compensatory cutbacks remain in place for various forms of overpayment.

  2.The coverage of basic needs of life is not being explicitly sought.

  3.There is no provision for bringing the full-time work minimum wage to the poverty exiting level.

  4.The action measures announced make it difficult to assess the evolution of null taxation levels.

  5.The Prime au travail begins to rectify the income treatment disparity between the basic welfare benefit and the null taxation threshold. In brief, the system annualizes allowed earnings from employment. The following plateau wherein each extra dollar earned is presently entirely deducted from the benefit received is modified so that there always remains something from each dollar earned. Revenues go on being improved by welfare benefits until a threshold of $15,000 for single individuals and $42,000 for a family of 2 adults and 2 children.

For childless individuals, the change is nominal, but it proves more substantive for families. Its main quality is to de-stigmatize employment earnings support, making it no longer a last-resort assistance but a universal program for all entitled citizens, on a mere income tax report basis. Its main danger, however, is to foster cheap labour exploitation if not accompanied by measures that will remnd hold employers accoutable for providing working conditions that help people escape poverty.

  6.Fiscal progressivity has not been improved.

This therefore creates an excellent challenge for our discernment, one that proves easier to address if we go on to the next issue : what must be the next steps of citizen action ? This is probably the most important question. Recent government announcements leave no doubt as to the issues surfacing in the wake of the Action Plan : an income security that would address the basic needs of life, starting with its full guarantee and indexation, and a minimum wage that would allow workers to escape poverty. What must we now take on to proceed, in conscience and reason, in this direction ?

How did the old song go ? « Forward, backwards, sideways... Together ! »

Vivian Labrie, Collectif pour un Québec sans pauvreté, April 18, 2004

Translation : Income Security Advocacy Centre, Toronto