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Section 1- Social Assistance Reform Act: New Rules

Eligibility

The Social Assistance Reform Act (SARA) came into effect fully on June 1st, 1998 replacing the old social assistance programs of General Welfare Assistance and Family Benefits Allowance with the Ontario Works Act and the Ontario Disability Support Program Act. All new social assistance applicants must apply under the new rules. Those people who were on those programs were or will be automatically transferred to the new programs. The Social Assistance Reform Act separates those in need of social assistance into two categories: people who are unemployed but considered employable, and people with disabilities. These two categories form two new separate social assistance programs:

1. Ontario Works

All individuals who are financially eligible for social assistance, and who do not fit into the new disability program, come under Ontario Works. This also includes adults between the ages of 60 and 65 years of age and single parents who were previously eligible for social assistance under the Family Benefits Act. To be eligible for Ontario Works, applicants must sign a participation agreement requiring them to perform activities in exchange for social assistance (for details see Section 2).

2. Ontario Disability Support Program (ODSP)

The Ontario Disability Support Program came into effective on June 1st, 1998. This new program is for people eligible for social assistance with a physical or mental impairment. The new ODSPA contains a new definition of disability (for details see Section 5).

Adults Who Live with their Parent(s)

Before the SARA was introduced, adults (those over 18 years of age) on social assistance living with their parents or guardian were considered financially independent and could receive social assistance benefits of their own. Under SARA, as of April 1, 1998, adults living with their parents or guardian receive either reduced benefits or become ineligible for benefits.

Ontario Works recipients who live with their parents or guardian and are financially independent (if they have or had their own income, have or are married or have been supported by someone other than a parent) receive a basic needs allowance but as of April 1, no shelter allowance.
If an adult is not financially independent from their parents and lives with their parents as of April 1, he or she is ineligible for benefits.
If an adult lives in a separate dwelling owned by their parents, they can still collect their shelter allowance benefits in addition to their basic allowance.

These rules do not apply for ODSP recipients living with their parents. ODSP clients who live with their parents can still receive full benefits, both shelter and basic needs allowance.

Asset Levels

To qualify for social assistance individuals may only have minimal financial assets. The same was true under General Welfare Assistance Act and Family Benefits Allowance Act; however, under SARA, the definition of "minimal" has changed. The new law reduces the amount of allowable assets for all social assistance recipients except those receiving an allowance under ODSPA.

In some cases families have had an 80% reduction in their allowable assets. For example, in the case of a single mother with one child, there has been a reduction of $5,000 to $1,457. This means if a single parent has assets such as money in savings accounts, an RRSP, etc., that family will not be eligible for social assistance benefits unless those assets are valued at $1,457 or less.
Regulations state that a person who was in receipt of social assistance at the time the law changed to reduce the asset levels, has one year to dispose of all assets above the new level.
Before Ontario Works was introduced, a social assistance recipient was allowed to own a car valued at a maximum of $10,000. Under the new law a person on social assistance is not allowed to own a car that is worth more than $5,000. If a recipient owns a car worth more than $5,000 they are allowed to keep the car for six months while looking for a job. If a recipient does not find employment within the six months, they must sell the car. If the proceeds are greater than the allowed asset level, the proceeds must be used to support the individual. When the individual’s assets fall below the allowable asset level they may reapply for social assistance.
Regular financial assistance from family and friends or the value of any bartering done between two people must be reported as income. This income will be deducted from the recipient’s benefits at the end of the month.

If there is suspicion that a person is transferring financial assets in order to qualify for social assistance, the individual can be denied benefits. Under the old law, asset investigations could go back into recipients personal/financial records as far as three years, now they can go back four years.

Place of Residence

A persons principal residence is exempt from being considered an asset. As under the old law, social assistance recipients are not required to sell their home in order to qualify for assistance. However, the new law allows for liens to be put on the principal residence of social assistance recipients who have been receiving assistance for more than twelve months. The intent is to treat the financial assistance the recipient receives like a loan.

Consent to the placing of the lien becomes a condition of ongoing eligibility.
The maximum amount of the lien is the equity in excess of 10% of the value of the residence plus $5,000 (e.g. The value of the house is $100,000. There is a $80,000 mortgage. The person’s interest/value in the house is therefore $20,000. 10% of the interest is $2,000, plus the $5,000 totals $7,000. The interest minus the $7,000 equals a maximum lien of $13,000).

The amount that can be recovered under the lien is the actual amount paid in financial assistance after the date the consent was signed. The recipient is only allowed to retain 10% plus $5,000 of their equity in the house.

Eligibility Review Officers

Eligibility Review Officers (EROs) are selected case workers with investigatory power regarding social assistance eligibility. The power of these officers is now recognized in the legislation.

EROs have the right to investigate the eligibility of a social assistance recipient on the grounds of suspicion.
EROs can obtain warrants to enter dwelling places. Other places can be entered without a warrant.
EROs can seize documents deemed relevant to a client’s eligibility. This can include any documents from a social service agency including shelters and food banks.

All individuals, including friends and relatives, deemed relevant to a case are required to cooperate with EROs or provide the requested documents. Those who do not cooperate face a penalty or a prison term.

Temporary Absences from the Province

If a social assistance recipient leaves Ontario for longer than seven days without permission the recipient is no longer eligible for assistance. This includes leaving to attend family functions that are out of province such as funerals and weddings.

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