To predict income security policies and programs a hundred years into the future, it is helpful, and perhaps necessary, to look back a hundred years. To know where we’re going, it is helpful, and perhaps neces- sary, to know from where we have come. Of course, income is only one element of any social policy, even one targeted to those who are most marginalized by their poverty, and is interdependent with policies and programs related to train- ing, labour markets including workers’ compensation and minimum wage legislation, child care, health care, and edu- cation. Nonetheless, income security programs and policies are the focus of this article.

Social policy ”” the cumulative effect of dozens of programs and laws and procedures of all levels of government ”” is a child of the 20th century. Until the last century, costs and risks now mitigated by collective spending and effort were the exclusive responsibility of individuals and families and some voluntary associations they formed to spread the risk. One could purchase life insurance and could insure against damage to buildings (usually by fire) from a private company by the turn of the 20th century in Canada.

But there was no sharing of risk with regard to sudden loss of income due to unemployment, disability, or costs associated with illness. Individuals and families, and some voluntary associations they formed, bore the economic burden of these life events. People who were never able to work ”” a group that included women with children and without a male wage-earner, the elderly, and people with physical or other severe disabili- ties ”” were the beneficiaries of chari- table organizations that emerged in the earliest days of Canada. They were the ”œdeserving” poor. Anyone else who could not earn enough money to sup- port his family was not deserving of assistance. Such a distinction between deserving and non-deserving poor has roots more than four hundred years old; while it was modified over the 20th century, it did not disappear, and perhaps never will.

At the beginning of the 20th cen- tury, some governments moved toward providing support for the ”œdeserving poor.” As early as 1908, the federal government introduced a vol- untary old-age pension plan, with gov- ernment subsidizing only its administration. In 1927, this was altered with federal subsidization of provincial pension plans for people over the age of 70 with very low incomes. Even before the 1920s, some provincial governments provided income support to lone mothers, although applicants were sometimes required to produce character refer- ences in order to qualify.

With the onset of the Great Depression, however, it was clear that neither the private market economy nor individuals and families nor the voluntary sector could prevent or alleviate the economic devastation that permeated every region of Canada, and extended well beyond the ”œdeserving poor.” Provincial governments created, in some instances, informal welfare and relief systems. Federal government legislation to provide employment and social insurance, an insurance-based model to share risk, was passed, but struck down by the courts as exceeding the federal government’s authority under law. The need was so great that an amendment to the British North America Act, the constitution until the 1980s, was passed, though not until 1940, to increase the powers of the fed- eral government to introduce an unemployment insurance program. Until a considerable expansion in the early 1970s, this program was a pure insurance plan, with benefits provided to those people who, upon becoming unemployed, had paid enough in pre- miums to qualify for these benefits.

There was sufficient interest in social policy, including income securi- ty, that the newly created Committee of Reconstruction commissioned a series of research reports, one by Leonard Marsh, entitled Social Security in Canada, released in 1943. Although largely ignored by Prime Minister Mackenzie King, many of its recom- mendations ”” for means-tested social assistance for those not covered by social insurance, national health insur- ance to cover all Canadians, and chil- dren’s or family allowances for families with children to support ”” became centre pieces of what became known as the welfare state in Canada over the next twenty-five years. At about the same time, provincial governments were creating public welfare depart- ments, and providing the means-tested social assistance that the federal gov- ernment would not begin to cost-share until the introduction of the Canada Assistance Plan some 20 years later.

A further constitutional amendment was needed, and passed, to introduce income support for all Cana- dians over the age of 70, in 1950, in the form of the Old Age Security Act. The Canada Pension Plan came in 1965. Income security in Canada, particularly with the amend- ments to the Unemployment Insurance Act in 1971 to extend coverage to new mothers and self-employed seasonal employers in some regions, was complete.

Over the same period, governments went from a first federal- provincial conference on disability in 1951, to federal passage of a Blind Persons’ Act in 1951, to a Disabled Persons Act in 1954, to the passage of the Vocational Rehabilitation for Disabled Persons Act in 1961. This Act created the program of the same name (VRDP), which offered to cost-share expenses related to helping people with disabili- ties to seek ”œgainful employment” with provinces. When the Canada Pension Plan came into effect in 1966, it includ- ed provisions for a disability benefit to be paid, effective 1970.

After a relatively stable decade through most of the 1970s and the 1980s, the income security system began to undergo a significant trans- formation. In what is described by Ken Battle of the Caledon Institute of Social Policy as a transition to a ”œpost- welfare state,” governments responded throughout the 1990s to a shift in the economy as significant as the industri- al revolution that spawned many of the problems that 20th century income security programs were designed to overcome.

Although spending on income supports and tax benefits intended to redistribute income to those in lower income brackets increased dramatical- ly from the 1980s to the late 1990s, the programs that had emerged to create an income safety net were cut back in significant ways, and brand new approaches were developed to replace them in more targeted and less visible ways.

By the late 1980s, a tectonic shift in economic and social behaviour was evident, made possible and neces- sitated by a globalization of the econo- my, along with social changes ranging from increased access to and use of increasingly sophisticated birth con- trol options and the reduction in fam- ily size, increased participation of women in the paid labour force, increases in marriage breakdown and lone-parent households, and a signifi- cant increase in the percentage of the population over the age of 65 (see Table 1). This shift has led to an equal- ly profound shift in how social pro- grams are designed and what policy instruments are selected. This has been true in Canada for more than a decade, and Canada is not alone in such a rad- ical redirection of public policy in this field. Nowhere is this more notewor- thy than in income security policy and programs.

One significant victim of these changes was the until-then con- ventional wisdom that governments had a role to play in creating employ- ment and generally trying to steer the economic life of a nation. Governments withdrew from income security pro- grams that might impede the ”œnatural” functioning of a labour market.

Evidence of this started in 1990, when the federal government stopped making financial contributions to the Unemployment Insurance Fund, leav- ing it to become self-financing, despite reforms that had expanded eligibility, reduced qualifying periods and added benefits just twenty years earlier. In 1996, the government went further, changing the name of the program from Unemployment Insurance to Employment Insurance, increasing the qualifying periods for part-time work- ers, and setting even higher entry requirements for those entering the labour force for the first time, or those who had been out of the labour force for more than two years. Many of this latter group were women who were staying home to care for infant chil- dren, perhaps subsidized in the first six months by maternity and parental benefits under the same program.

At the same time, most govern- ments determined to reduce and eliminate what were suddenly seen as excessive deficits. The earliest cuts in spending within income security pro- grams focused on the ”œundeserving poor,” i.e., those who were deemed to be capable of earning an income for themselves and their families. Hence, social assistance rates for single people who were deemed to be employable were slashed. ”œWorkfare” was intro- duced in some provinces, requiring recipients to work or enrol in training or education programs. Social assis- tance was no longer available to any- one who was a full-time student, even if the individual was supporting chil- dren, forcing anyone seeking a major improvement in their education status to rely on student loans and private income. Whereas single mothers were considered ”œunemployable” in some provinces until their youngest child turned 18, some provinces now consid- ered single parents employable when their youngest turned six months.

These changes came at the provin- cial and territorial level, where governments were not only wrestling with large deficits, but also reeling from a unilateral and unexpected end to complete cost-sharing of social assistance and social services spending under the Canada Assistance Plan in 1995. The replacement program, the Canada Health and Social Transfer, not only ended the equal cost-sharing, but it set ceilings that were considerably lower than the amounts they had been transferring in recent years.

In addition to reducing benefits and imposing stricter eligibility requirements upon applicants for assistance, though, provincial and ter- ritorial governments took the end of the Canada Assistance Plan as an opportunity to propose a new way of planning and delivering social assis- tance and social services across Canada. Their leadership led to the development of the Social Union Framework Agreement in the late 1990s, which had the effect of ensur- ing that the federal government would not make unilateral decisions about funding programs, or ending their funding. Also, this initiative incorporated making two priorities determined at the provincial and terri- torial level ”” early childhood devel- opment and addressing equality of access to economic and social partici- pation for persons with disabilities ”” shared priorities by both levels of gov- ernment. It is in these areas that sig- nificant gains have been made in recent years.

In a new era of federal/provin- cial/territorial relations, the instru- ments of progress have been different than those developed before. Yes, the federal government continued to pro- vide financial support, and the provin- cial and territorial governments continued to provide both financial support and services. The difference this time has been that the federal gov- ernment has used the tax system as a primary means of spending, putting money directly into the hands of indi- vidual Canadians. For children, parents have seen vastly increased transfers, through the Child Tax Benefit and the Child Tax Credit. For people with dis- abilities, increases in the deductions in the tax system, and the introduction of new benefits transferred through the tax system with the last budget have been a big part of the federal contribution. Where before the federal government transferred money to the provincial and territorial governments for each program, now the federal gov- ernment is subsidizing incomes of indi- viduals, leaving provincial and territorial governments more room to spend on program delivery.

Looking backward then, one can see a focus at the beginning of the 20th century on the ”œdeserving” poor: chil- dren, people with disabilities, and the aged. At the end of the century, the poverty of seniors has been largely eliminated through the creation of the contribution-based Canada Pension Plan, the universal Old Age Security, and the income-tested Guaranteed Income Supplement. Children in all households benefit from a combination of universal and income-tested benefits delivered through the tax system. And people with disabilities receive compen- sation for some of the costs imposed by their disabilities and some income supplementation through the tax system, they may receive benefits through the partially contribution-based disability benefit under the Canada Pension Plan and means-tested benefits through the provincial and territorial social assis- tance systems.

To look forward, in the absence of a crystal ball, one needs very special glasses, with very special lenses. There are three sets of glasses and lenses that inform three views of what this centu- ry will bring for income security in Canada. The first looks at the post-wel- fare state and its characteristics and what income security would look like from this perspective. The second takes the view of social citizenship, and what income security will look like if that is the dominant vision of social policy in Canada. The third looks at the family view, and what income security would look like if it is decided that families are the best vehi- cle for achieving social policy goals.

These lenses do not provide radi- cally different views of the world, and overlap in significant ways, but have subtle differences that help clarify a view of the future.

The post-welfare state, although present in the social policy discourse of several countries, is seen in a relatively positive light in Canada. Among Australian and British scholars, for exam- ple, it is seen as a complete withdrawal by the state from the provision of basic eco- nomic and social minimums, including income security. In Canada, hardly known for its optimism in these matters, but admittedly not having experienced the same ideological extremes in govern- ments as some of our Commonwealth partners, the post-welfare state is various- ly seen as a society in which civil society organizations play a greater role in the provision of social services, a society in which services are a right of citizenship (discussed further below), and an income security system in which the public poli- cy goals are largely unchanged, the role of government remains significant, but the tools of delivery have changed. It is this latter view, fully developed by Ken Battle and Sherri Torjman of the Caledon Institute of Social Policy that provides our first lens.

As noted above, Battle provides considerable evidence that public spending on income security programs did not decline in the late 1990s. With a dual function of both taming and nurturing capitalism, the income security goals have remained unchanged, he argues. However, he sees the shift from universality with rela- tively low benefit levels to tar- geting with more generous benefits as serving Canada’s evolving economic, social and political characteristics.

The characteristics of Battle’s post-welfare state, as applied more narrowly to income security policies and programs, are:

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  • the replacement of universal income transfer programs and needs-tested benefits by broad-based and progres- sive income-testing (without chang- ing income transfers through social insurance programs like the Canada Pension Plan and Employment Insurance);

  • explicit attention to disincentives that can be created by income security programs, including mar- ginal tax rates for people trying to move from social assistance to the paid labour force;

  • consideration of how income security programs and the tax sys- tem interact;

  • a goal of balance between pro- grams that are intended to prevent income losses and those that are intended to remedy them;

  • greater cooperation between levels of government to ensure a fit among income security programs;

  • attention to the financial sustain- ability of income transfer pro- grams in advance of implementa- tion; and

  • greater attention to evaluation of results of programs, and the dis- semination of those results.

If one assumes this direction were to continue through much of this centu- ry, the future of income security will see a clear division between the responsibili- ties of each level of government. The fed- eral government can be expected to transfer income directly to individuals and households, largely  through the income tax system, both to support shared policy goals and to provide remedy for income shortages deemed to be intolerable. Recent examples of shared policy goals include income transfers for children to support child development, recently announced income support for persons with disabilities to offset the costs associated with impairment, and greater financial support to families to encourage greater participa- tion in the future in post-secondary edu- cation. At the same time, provincial and territorial governments, and the munici- palities in their jurisdictions, can be expected to focus more on developing and implementing programs that will provide the services necessary to achieve these same goals, and others that may be more regional or local.

If this shift results in the greater effectiveness and efficiency, and greater adaptability to economic, social and political change, as foreseen by Battle, one might expect greater support for the programs from the pri- vate sector, at least. For intended ben- eficiaries, the income support side of the equation that the federal govern- ment will implement will be more direct, and less connected to eligibility determined on the basis of need as interpreted by public officials and the agencies they use to deliver services.

The greatest unknowns, when the future is viewed through this lens, is the extent to which priorities will stay relatively stable over time to provide real income security, or whether they will change with each political cycle, resulting in income transfers without any stability or security.

Social citizenship, like the post- welfare state, means different things to different people, but can be seen to bring together social rights as articulat- ed in international conventions and domestic constitutions and legislation, social inclusion and cohesion, and a notion that being of a particular coun- try gives one a right to more than polit- ical and economic participation. It has been applied to children, to people with disabilities, to women, to immigrants, and to civil society organizations that serve and represent them. In short, it’s been applied to almost every group that can be seen to be marginalized in cur- rent economic and social contexts, and is the rubric under which the income security programs described above are defined by some. In this case, however, it is defined in its social democracy context. As Jane Jenson, of Université de Montréal and recently of the Canadian Policy Research Networks, describes it, social citizenship looks not at how much money is spent on a program, but at why the money is spent.

Jenson argues that some Canadian income security programs of the 20th century were of a ”œlast-resort” nature, while others sought to share life risks, and to support some activities, including parenting, thereby blending individual and collective responsibilities, efficiency and equity considerations, to end up squarely in the middle. But, she says, we are moving away from collective respon- sibility, away from equity considera- tions, in the direction of providing only those services that support those unable to work, and even then often providing them through third-party (voluntary or private sector) agents. The principal fac- tors underlying these changes, Jenson argues, are an aging society, changing family structures, growing diversity, and persistent low-income and poverty, increasingly affecting young house- holds. When combined with attention to first deficit reduction and then debt elimination, and changes in governance based in part on shifts in ideology to embrace a greater role for the private market and a lesser role for the state, leading social services to greater reliance on the voluntary sector, Jenson con- cludes that social citizenship in Canada is defined more in terms of individual responsibility and much less in terms of mutual responsibility, based more on efficiency than equity.

If the shift identified by Jenson per- sists, the future of income security in Canada would see greater targeting to the ”œdeserving” among us, who cannot be expected to seek, obtain and retain employment: the very young, the elderly, and, perhaps, the severely disabled. From the lens of this shift in the parameters of social citizenship, then, many recent ini- tiatives can be seen as promoting or requiring greater self-reliance, whether among single parents (as discussed fur- ther below), or among people with dis- abilities. Social inclusion, from this view, requires inclusion in the paid labour force, and one can expect that more and more people will be considered capable of earning their own income. Given the extremely high participation rate of women in the labour force, the persistent need for two incomes to support a single household, and the need to encourage higher rates of reproduction to sustain a labour supply once the baby-boom bub- ble has burst, one could also expect greater support for families with chil- dren, but likely through services, rather than income support.

A focus on families as central to social and income security at the end of the century is the domain of several different points of view, from those seeking to sustain what appears statisti- cally to be a nostalgic view of the ”œfam- ily” as it may have existed very briefly more than sixty years ago, to a feminist perspective that insists on a gender- based analysis to demonstrate dispro- portionate impacts, usually negative, of public policy on women, with several views in between. There being no sin- gle analyst who has taken this perspec- tive and synthesized the past century while looking forward to the rest of this one, this lens is an amalgam of evi- dence and views of many analysts.

As early as 1995, University of Alberta business professor Dr. Alice Nakamura had flagged the impact of child-rearing on women’s labour supply and surfaced the notion of ”œtaking chil- dren off welfare” as a means to encouraging women to enter the labour mar- ket. Her notion was that if income trans- fers were focused on the children, rather than the parent(s), then single mothers could be considered ”œemployable” under social assistance programs, since their income would not be drastically reduced if they chose jobs over welfare, even if the jobs paid low or mid-level wages. Effectively, she was proposing a guaran- teed annual income for children.

Maureen Baker, currently of the University of Auckland, joined forces with David Tiffin in 1999 to compare four countries to assess their treatment of mothers with respect to poverty, social assistance, and employability. One of those countries was Canada. Baker and Tiffin concluded that women’s labour force participation in Canada was higher than in other countries because of a greater need for two incomes to support a single household and because of a health- ier labour market. In looking at restruc- turing of the welfare state at that time, they also flagged that the three other countries (Australia, New Zealand, and the United Kingdom) persisted in their policy and program design in seeing part- nered women as dependent on men (at least economically) and single mothers only in terms of their parenting role and not as potential employees. Canada, they said, was beginning to err in the opposite direction, assuming incorrectly that sin- gle mothers can become self-supporting simply by entering the labour market.

Developments in income security programs late in the last century sug- gest that governments are moving in the direction suggested by Nakamura and identified by Baker and Tiffin, with freezes or reductions in social assistance benefits, greater income transfers through the tax system to support chil- dren, and more rigorous requirements for mothers of pre-school children to enter training or employment. While it is true that some provincial govern- ments are now revising welfare rules to permit women to stay home for longer with very young children, there is no evidence that this trend is reversing.

Using this lens to look forward, then, continued income transfers for children will combine with the increased support for child care prom- ised by all but the Conservative Party in the recent federal election to allow par- ents, whether alone or coupled, to par- ticipate in the labour market while still providing for pre-school-aged children.

The view through all three lenses suggests that the following will be the income-security scenario at the end of this century.

The twentieth-century income- security system will be seen as the transition between a society and economy where a parent was in the home available to every child, where wages were a rare source of income and where individuals and families were reliant only on self and commu- nities and the risk-sharing associa- tions they created at the beginning of the century, and one in which every- one earned wages, with the state ensuring the opportunity for econom- ic participation for virtually every individual, regardless of parental sta- tus, disability, or age (except for minors), through the provision of supporting services, income support for the very young and the very old, and a continued sharing of life risks through social insurance programs. That picture suggests that income security programs will still exist, that the paradigm will still combine indi- vidual and collective responsibility, but that the private market will be seen as capable of achieving many of the goals that were the focus of income security programs in the intervening 20th century.

This forward-looking picture, of course, neglects the probability that before the turn of this century, the economic engines will again be ones we wouldn’t even recognize now, and that the tools of income security will better fit that reality than the ones we can see now.

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