Prime Minister Justin Trudeau rises during Question Period, in Ottawa, on June 19.Adrian Wyld/The Canadian Press
Heading into budget season this year, the federal Liberal government was caught between two promises: keeping the deficit in line with its projections, and launching a much anticipated new benefit for disabled Canadians.
The Liberals had long sold the Canada Disability Benefit, first announced in 2020, as a measure designed to close the yawning gap between what people with disabilities receive in provincial assistance and the income they need to rise above the poverty level.
But now that the benefit is finally here and facing wilting criticism, it’s clear that it was compromised from the start by the Liberals’ budget woes, and likely never should have happened – at least in its current form.
Before the budget was tabled in April, expectations for the new federal benefit were high. The Liberals, with the help of the NDP, had pushed the Canada Disability Benefit Act through Parliament the previous summer, and had promised to reveal the details in the April budget.
The Parliamentary Budget Officer costed out three scenarios in November, 2023, based on the stated goal of closing the gap between social assistance and the official poverty threshold; it concluded that the annual maximum payment, before clawbacks based on personal income, needed to be between $14,356 and $22,701.
Disability advocates said the maximum annual amount needed to get recipients over the poverty line was in the neighbourhood of $24,000.
Those expectations, and the hope they elicited in people with disabilities, were upended when the budget came out in April. The annual maximum amount of the Canada Disability Benefit set by the Liberals was a relative pittance: $2,400.
Ottawa planned to spend $4.9-billion between then and 2029 on the benefit, according to the April budget – a disappointing amount for disabled people that reflected the realities of the government’s constrained finances.
Not only that, the government limited eligibility to people who qualify for the federal Disability Tax Credit, a measure that lowers the amount of federal taxes paid by people with long-term impairments.
Critics pointed out that the DTC is difficult to apply for, requiring an assessment by a qualified medical practitioner, and that it is only available to people who file their taxes, something that low-income people don’t always do.
Ottawa’s new benefit is going to be available to 600,000 people, even though there are 1.6-million people in Canada with severe or very severe disabilities, according to the government’s own data.
As if all that wasn’t disappointing enough, it has since emerged that Ottawa hasn’t reached agreements with every province and territory to prevent them from clawing back recipients’ social assistance – a provincial jurisdiction – for every federal dollar they receive under the new benefit.
That means the program will have zero net benefit for recipients in eight provinces and one territory, unless and until agreements are reached.
It’s a terrible disappointment for people with disabilities.
The provinces and territories are responsible for social assistance, but those supports are “largely insufficient to meet the economic demands that many persons with disabilities face in their day-to-day lives,” as Ottawa has noted.
The PBO says that existing provincial and territorial programs for people with disabilities fall short of the official poverty threshold by 40 per cent on average.
What is also known is that 50 per cent of people with severe disabilities are unemployed, according to Statistics Canada. For those with very severe disabilities, the figure is 75 per cent. They need help.
But the reality of the need to stick to its deficit projections has collided head-on with the Trudeau government’s endless appetite for creating new social programs designed to turn around their electoral fortunes.
The result is a benefit that is unfit for its stated purpose, because Ottawa’s finances are stretched so tight that it simply doesn’t have the money to do a proper job of it.
A better use of those limited funds would have been to send them to the provinces as a top-up to existing benefits.
Governments should spend money in ways that help Canadians, not on half-baked branding exercises that leave some of the country’s most vulnerable people barely better off.