By now, you may have heard that the Ontario government announced a few changes to the Ontario Disability Support Program (ODSP). These changes include:
- Raising the asset limits from $5,000 to $40,000 for single individuals and from $7,500 to $50,000 for couples;
- Increasing the income exemption for gifts and voluntary payments from $6,000 to $10,000 per 12-month period;
- Exempting gifts if the funds are used to pay for first and last month’s rent, purchasing a principal residence or buying a vehicle; and
- Increasing benefit rates by 2%.
While these changes signal the first significant shift in social assistance policy in recent years we cannot help but be disappointed. Since its inception, PooranLaw has been involved with various law reform efforts focused on increasing asset and income limits for those relying on ODSP. These efforts have included developing submissions for community-based organizations, writing law reform papers for the Law Commission of Ontario, meeting with numerous bureaucrats and politicians within the Ontario government and most recently being part of a coalition lead by #HelenRies. Our consistent message has been simple – current ODSP restrictions on gifts and assets promote a life of poverty for ODSP recipients. The current structure does not allow individuals to accumulate sufficient savings to create the financial safety net required to live comfortably or come off social assistance. In addition, individuals are unable to pay for their most basic needs given the limits that income restrictions place on supplementing substandard social assistance rates.
Consider for example, parents that are planning for their daughter Mary and her future financial security. Mary’s only source of income is from ODSP and therefore they incorporated a Henson Trust into their estate plan to provide for her future without affecting ODSP eligibility. They anticipate that the trust will have $500,000 in assets and expect the monies to be used to pay for Mary’s basic needs and enhance her quality of life. Based on the proposed budget changes, Mary’s trustees could not access more than $10,000 every 12 months to pay for Mary’s everyday living expenses including her rent. With an ODSP shelter allowance of less $500 this only allows Mary a monthly allowance of just over $800 from the trust to cover her housing-related costs. With living expenses at an all-time high in Ontario, this is simply not realistic or sustainable.
We have been calling for the elimination of limits on voluntary gifts and an increased asset allowance of $100,000. This ask is low cost and the changes would not be novel. Ontario implemented legislation in 2008 that allows ODSP recipients to access funds from their Registered Disability Savings Plans without imposing any monetary limit. More recently, the British Columbia government changed its social assistance laws by raising asset limits to $100,000 and eliminating a ceiling on voluntary gifts and payments. If Mary were living in B.C. her trustees could access the funds she needs on a monthly basis to pay for her everyday living expenses without having the fear of a clawback being imposed on her ODSP benefits.
It’s time for Ontario to recognize the barriers being faced by ODSP recipients and to act in a meaningful way that would have positive and sustainable impact for people who rely on social assistance benefits. While the changes proposed in the Budget are a move in right direction we do not believe that they will provide individuals with the financial security they require to avoid a life of living in poverty. Low cost, regulatory changes, like those implemented in British Columbia, are needed now.
We are coming in to an election year with the current government facing low approval ratings. With a balanced budget, the government has shown it is eager to make changes that will sway voters. We need to act now to show the government that people with disabilities who rely on ODSP have a voice and that we are willing to use it in the ballot box. We encourage you to speak to your local MPP, the community groups with whom you are connected, and any other relevant outlets about the need for real and meaningful change.