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October 6 , 2006

Too Much Red Tape in Rental Assistance Program

If almost 50,000 British Columbians are eligible for the new rental assistance program, why did BC's Housing Minister Rich Coleman predict that only 15,000 will take advantage of the plan?

A lot can be said about the relative merits of social housing and rental assistance, but like it or not, the Campbell government has launched what it says is an annual $40 million rental assistance program. If that money really gets to those in need, it will be a good thing, but why isn't the government doing more to reach out to families who might be eligible for the program?

It is hiring people to market new lottery tickets in bars and pubs. It is spending over $4 million on advertisements to tell British Columbians that it is having a conversation on health. With far less effort than it takes to sell lottery tickets or buy TV ads, it could write to almost every family that is likely to be eligible and provide them with a simple one page application form. Rather than reducing unnecessary red-tape and regulations, something it prefers for its friends, it has put a five page application form in front of families that might qualify for rental assistance. Anyone who is eligible for the new rental assistance program is also eligible for and likely receiving MSP premium assistance. The MSP premium assistance application form is a relatively simple two pages.

In order to receive rental assistance a family must have at least one child under age 19 and less than $20,000 in income, some or all of which comes from employment and none from income assistance. The family must have less than $10,000 in liquid assets, including any RRSP, and must have lived in BC for at least 12 months. In order to receive premium assistance a person must have family income less than $28,000 (after subtracting $3,000 for each person over age 65 or disabled). From the premium assistance records it would be simple to determine which families are most likely to be eligible for rental assistance and send them a simple application form asking for the asset information and proof of rent paid. The government might claim that privacy considerations make the simple approach impossible, but a call to the Information and Privacy Commissioner would likely produce approval and any necessary legislation could be introduced when they get around to calling the legislature to sit. Instead of protecting privacy, it is far more likely that the government is making the application unnecessarily complicated so it can boast that it is doing something, while it saves money by making it difficult to apply. Poor families aren't going to have easy access to the Internet to obtain the information and application form. They must photocopy their last income tax return as well as their notice of assessment from Revenue Canada, even though both Pharmacare and MSP already have that information. It will be interesting to track how quickly the government responds to applications and how long it takes at least 15,000 poor families to apply for and receive benefits.

According to 2003 tax data, there are 177,120 lone-parent families in BC with a median income of $26,500. That means there are 88,560 lone-parent families in BC with incomes below $26,500. The Campbell government may think, after subtracting the number on welfare, all but 15,000 are above $20,000 and below $26,500 but that is not credible. Based on data from Revenue Canada, 82% of those with incomes between zero and $26,500 have incomes under $20,000, which suggests 72,620 lone-parent families have incomes under $20,000.

The Ministry of Employment and Income Assistance reported that in July 2006 there were 4,779 lone parent families receiving assistance who were temporarily excused from work, 1,114 with persistent multiple barriers, 1,064 who were expected to work but temporarily excused due to a medical condition, 3,901 who were expected to work and 4,028 who were disabled, for a total of 14,886. In 2003 the total of single parent families receiving assistance was 23,559. That suggests there were 49,000 single parents in 2003 who had incomes under $20,000 and who didn't receive income assistance.

In 2003 there were 82,700 women working full-time making less than $10.00 an hour, less than $20,800 a year, and there were 92,700 working part-time making less than $10.00 an hour, less than $15,600 a year. There were 83,900 women aged 25 or over working full and part-time and making less than $10.00 an hour. With figures like that, it is hard to understand how the Minister Responsible for Housing could estimate that only 15,000 families would immediately benefit from the Rental Assistance Program.

It would be useful if the government that claims to be transparent laid its cards on the table and explained how it estimated that the rental assistance program would cost $40 million per year and that only 15,000 families would take advantage of it. To help with the transparency, a freedom of information request has been filed that asks that question.


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