Community Initiation of Welfare-to-Work - solutions · Community Initiation of Welfare-to-Work ... Voluntary Sector-Based Welfare-to ... The change from “passive” to “active”

Community Initiation of Welfare-to-Work 1

Community Initiation ofWelfare-to-Work

By Christopher Leo and Todd Andres

ISBN 0-88627-395-1 December 2004

2 Canadian Centre for Policy Alternatives–Manitoba

CCPA-Manitoba309-323 Portage St., Winnipeg, MB R3B 2C1tel: 204-927-3202 fax: 204-927-3201email: [email protected]://www.policyalternatives.ca

Community Initiation of Welfare-to-WorkBy Christopher Leo and Todd Andres

ISBN 0-88627-395-1December 2004

About the authors

Christopher Leo is a professor of Politics at the University of Winnipeg, and a CCPA-MBResearch Associate.

Todd Andres is a student in the Faculty of Law at the Univeristy of Manitoba.

CAW 567

Acknowledgments

The authors are happy to acknowledge generous financial support from the Social Scienceand Humanities Research Council (SSHRC) Initiative on the New Economy. This paper ispart of a research project of the Manitoba Research Alliance on Community EconomicDevelopment in the New Economy, SSHRC project no: 538-2002-1003. For further in-formation please see: http://www.brandonu.ca/organizations/rdi/MRA.html


Contents

1. The New Economy and Community Development ........................................................................ 5

1.1 Welfare-to-work vs. workfare .......................................................................................................... 6

1.2 Workfare in Quebec and community response ......................................................................... 7

2. Voluntary Sector-Based Welfare-to-Work........................................................................................... 9

2.1 Alternative tomorrows in Winnipeg’s North End ....................................................................... 9

2.2 Community innovation in Nova Scotia ...................................................................................... 10

3. A Municipal Initiative in Welfare-to-Work ........................................................................................ 11

3.1 A constructive approach ................................................................................................................ 11

3.2 Attacking the Elm Bark Beetle ...................................................................................................... 13

3.3 Infrastructure Renewal ................................................................................................................... 14

4. Back to Workfare: Provincial Takeover ............................................................................................. 17

5. What Can Be Learned? ........................................................................................................................ 19

Endnotes ...................................................................................................................................................... 21

References ................................................................................................................................................... 22



RECENT CHANGES IN THE GLOBAL ECONOMY have enabled productivity to in-

crease, allowing for new ways of generating wealth and creating economic growth. At the

same time, it has become increasingly evident that some are missing out on a share of the

benefits provided by the New Economy. The New Economy, as identified by the Manitoba

Research Alliance, is underpinned by three major structural changes. These are:

serve to define CED for the purposes of this pa-per. They are as follows:1. Use goods and services produced locally.2. Produce goods and services for local use.3. Re-invest profits locally.4. Employ residents over the long-term.5. Develop local skills.6. Make decisions locally.7. Improve public health.8. Improve the physical environment.9. Stabilize neighbourhoods.10. Actively support human dignity.11. Actively support solidarity among neighbour-

hoods (Neighbourhoods Alive! Forum, 2002,7).

In the past, Canada and other developed na-tions counted on a rising GDP to reduce both thenumber and percentage of low-income individu-als. This relationship however, is no longer as con-crete as it once may have been. Today, we cannottake for granted that economic growth will be thetide that raises all ships. This was most clearly dem-onstrated in Canada of the mid 1990s, when thelow-income population increased despite growthin GDP in real terms and the addition of 214,000

1. The New Economy andCommunity Development

• A rise in general education levels.• The development of new information tech-

nology.• An increase in “invisible” trade in services,

mergers and acquisitions, and the flow of in-formation (Manitoba Research Alliance, 2003,3).

Statistics Canada estimated that 64% of newjobs created between 1986 and 2000 will requirefrom 13 to 17 years of education, leaving out asubstantial portion of Winnipeg’s workforce. Anunder-trained and under-educated workforcebrings with it many other social problems associ-ated with institutionalized poverty, which have aprofound effect on the well-being of communi-ties unable to participate in the New Economy(City of Winnipeg, 1992, 5).

Community Economic Development (CED)is used as a response to the dislocations caused bythe New Economy. This approach seeks to addressthe needs of all communities and groups by inte-grating the cultural, social and economic goals ofthe community. Eleven principles established inconsultation with Neechi Foods (an aboriginalworker-run collective in Winnipeg’s inner city)


new jobs in 1995, as well as 171,000 in 1996(Torjman, 1998, 1,2).

Welfare rosters reached record highs for manycities in the early and mid-1990s. This spurredgovernments in Canada to focus more on findingsolutions to the problem of ever growing welfarerosters, rather than seeking solutions to the prob-lem of poverty. This was a trend in social assist-ance delivery in the 1990s, as U.S. DemocraticPresident Bill Clinton embraced the conservativeargument that welfare policies lead to family break-down because poor women find government re-sources preferable to those of a low-paid spouse(Collins, 1992, 42). In 1996, U.S. Congress passedthe Personal Responsibility Act, which allowed thetermination of welfare benefits to long-term wel-fare households, and required participation inwork or job training (Hardina, 1997, 131).

As a result of the drastic increase in the size ofwelfare rosters during this period, most Organi-zation for Economic Cooperation and Develop-ment (OECD) countries have reorganized theirwelfare systems so that they are no longer “pas-sive” transfers of cash to recipients, but are a more“active” policy effort. These new policies involveemployment measures known as welfare-to-workand workfare programs (Reynolds, 1995, 106).The critical change made by these governmentswas the linking of qualification for benefits to par-ticipation in employment programs (Shragge,1996, 13). This change is at least partially rootedin an ideology that individualizes the causes ofpoverty, focussing on the individual, rather thanon broader social and economic factors.

The change from “passive” to “active” welfaremeasures in Canada was aided by then financeminister Paul Martin’s slashing of $7 billion intransfer payments to the provinces when he dis-continued the Canada Assistance Plan (CAP) andreplaced it with the Canada Health and SocialTransfer (CHST) (Jackson, 2001, 217). Under theCAP, welfare had been defined as a right. Further-more, the CAP acted as a medium through which

the federal government contributed financially toprovincial social programs and established nationalstandards for the provision of social assistance.More importantly, the CAP did not permit pro-vincial administrations to require welfare recipi-ents to work in order to receive their welfare ben-efits. In that legislation, it was need that estab-lished eligibility for social assistance (Shragge,1996, 23).

Since the introduction of the CHST, provin-cial social welfare departments have changed theirmandates from finding effective ways to distrib-ute welfare benefits to those in need, to findingways to quickly reintegrate recipients into theworkforce (Gorlick, 1998a, 3). As a result, em-ployment initiatives are now integrated into pro-vincial welfare programs.

1.1 Welfare-to-work vs. workfare

Central to the discussion of welfare reforms arethe terms “workfare” and “welfare-to-work”. In thispaper, the term “workfare” or “work for welfare”,refers to a system of social assistance in which quali-fication for welfare benefits is contingent uponparticipation in mandatory work measures. Thisapproach fell into disrepute in the Post World WarII welfare state, on the grounds that it tended toexert downward pressure on wages by creating aready supply of cheap labour and that it riskeddriving some who could not adapt to the labourmarket into absolute penury. It has also been criti-cized, in the more typical case of social assistancerecipients who are able to adapt to low-paid work,as failing to offer a constructive avenue towardbetter jobs and incomes.

We define workfare as incorporating some orall of the following elements:• Recipients are forced to go to work• Recipients suffer consequences if they do not

go to work


• There is little or no opportunity for skill de-velopment

• The recipient has little or no choice in thetype of job

• The work is not part of the competitive la-bour market and is created solely for the re-cipient (Gorlick, 1998a, 6).

While the majority of provinces deny that theirprograms are workfare, many of them carry pen-alties for failure to participate. In Manitoba, pen-alties for non-participation for recipients of socialassistance with children, start at $50 a month, andcan be increased to $100 per month after sixmonths (Gorlick, 1998a, 7). Manitoba legislationactually permits harsher measures.

Section 5.4(1) of the Employment and IncomeAssistance Act states that the recipient must meetthe work or employability enhancement measuresas set out by the social services director assessingthem. If they fail to do so, section 5.4(2) allowstheir social services director the ability to “deny,reduce, suspend or discontinue the income assist-ance” to that recipient (C.C.S.M. c. E98).

In Alberta, single parents with a six-month-old child are required to formulate an employmentplan in partnership with a welfare official. Failureto do so can result in the termination of welfarebenefits (Gorlick, 1998a, 7,8). More generally,Canadian social assistance policies are premisedon the belief that it is lack of skills and training,not a shortage of punitive measures, that keepwelfare recipients out of the workforce, but prac-tical application of this premise has fallen short.Too often job placement for welfare recipients hastaken on the character of workfare by providingmainly low-pay, precarious service sector jobs(Shragge, 1996, 29) with little opportunity for skilldevelopment, job advancement, or growth in senseof self-worth.

In this study, we explore avenues out of wel-fare through job placement, but aim at somethingbetter than workfare. Welfare-to-work, as we de-

fine the term, seeks to reintegrate welfare recipi-ents into the workforce by offering opportunitiesfor betterment, rather than threatening them withconsequences for failure to work. Taking a cuefrom the folk wisdom that “you can catch moreflies with honey than vinegar”, we argue that, if awelfare-to-work program is to contribute to theeleven principles of CED listed above, it must havethe following tenets as its norms:• Voluntary participation: The programs should

support and encourage people to enter theworkforce, instead of punishing them (CCSD,1999, 1).

• Work that is useful to the community (as op-posed to alienating make-work projects).

• Job training that is capable of leading to long-term employment at wage levels significantlyhigher than minimum wage.

1.2 Workfare in Quebec andcommunity response

In 1989, even before the introduction of theCHST, Quebec became the first province to in-troduce welfare reforms. The objectives of the re-forms were three-fold:1. To identify those people deemed employable.2. To introduce a stricter, more all-encompass-

ing system of work incentives.3. To compile better statistics on the welfare

population to improve understanding of thedynamics of welfare use. (Reynolds, 1995,111).

Quebec was the first province in Canada tointroduce a workfare approach to the delivery ofsocial services. One of the main lessons that canbe drawn from Quebec’s experience with its re-forms of the welfare system is a phenomenon calledthe substitution effect. This occurs when privatecompanies hire labour from welfare-to-work pro-grams at a subsidized rate. As a result, instead of


hiring from the general population, they do sofrom a pool of subsidized labour, causing oppor-tunities to be lost for those potential employeeswho might have been hired without subsidization.

In a poll of 1,600 employers involved in Que-bec’s welfare-to-work programs in the private sec-tor, fifty-two percent said that had they not hireda program participant, an unsubsidized workerwould have been hired to fill the position(Reynolds, 1995, 131). This response suggests thatthere is upwards of a fifty percent substitution ef-fect when private companies become involved inwelfare-to-work programs (Reynolds, 1995, 132).While it may be the case that subsidies are goodincentives for companies to hire social assistancerecipients, if half of their hires are being subsi-dized to crowd out workers who are not on wel-fare, it is reasonable to ask whether the good theprogram is doing outweighs the harm.

When third sector organizations - communitygroups - become involved in these programs, theresult is quite different. In Quebec, the third sec-tor – also known as the social economy or the non-profit sector - was involved in employment train-ing long before the government was. As a result ofthe cutbacks of the 1990s, many of these commu-nity-based organizations were forced to close theirdoors, or look for new sources of funding. In manycases, groups who were opposed to the welfare re-forms in Quebec were forced to participate in theseprograms as they represented one of the few sourcesof funding available (Shragge and Deniger, 1996,74). Participation in these programs revealed cer-tain tensions:• Groups that had once fought on behalf of their

marginalized clients were running programsthat made them managers of the poor.

• The community sector was becoming a newtype of labour market, but one without em-ployment standards and minimum wages.

One community sector organization, however,found a way of taking advantage of these programsin order to help its clients.

The Notre-Dame de Grace Anti-PovertyGroup (NDG-APG), was formed in 1988 as a pro-test group against Quebec’s welfare reforms. Theysecured funds under the guise of providing com-puter-based skills training and general pre-employ-ment readiness. The benefits associated with theprogram included training participants as advo-cates for those on social assistance, as well as build-ing a counter-culture of poor people through thecreation of a literary magazine and maintainingan ongoing struggle against the welfare reforms(Shragge and Deniger, 1996, 75).

While the program participants saw the com-puter skills training as useful, it did not tend topay off later in job hunting. However, the groupused the same welfare-to-work program to estab-lish two offshoot businesses that specialized in re-cycling furniture and clothing (Shragge andDeniger, 1996, 76).

Despite its mixed results, the response ofNDG-APG to workfare is suggestive of positivepotential in community initiatives to create jobopportunities for social assistance recipients andequip the recipients for rewarding participationin the world of work.

We turn next to three other, similar initiatives.Two of these, like the NDG-APG programs, arevoluntary sector-based and one was generated bymunicipal government.


2. Voluntary Sector-BasedWelfare-to-Work

centre to do job searches or check e-mails.Support staff are also available for anyone lack-ing computer skills.

2. Mentors help recipients work through theiremployment barriers, often including addic-tions, abuse, and illiteracy.

3. Career counsellors help PATH participantsbuild job-related skills, look up jobs and sendout resumes.

4. An employment liaison helps recipients brushup on skills they will need to succeed in theworkplace (Johnson, 2003, 1).

Participants are placed in a mentored job po-sition, secured by PATH, usually in manufactur-ing or warehousing; sometimes in retail trade, in-cluding Giant Tiger, a discount store, and Wal-Mart, or in hotels as cooks or chamber maids.(Johnson, 2003, 1). Through its employment li-aison, PATH is constantly in touch with organi-zations such as SEED Winnipeg, the WinnipegRegional Health Authority and Mount CarmelClinic in Turtle Mountain (Morin, 2003).

PATH accepts the challenge of dealing withsome of the most difficult cases, including manyinstances of addiction and health problems. Nev-ertheless, by September 2003, 25 persons had beenplaced in jobs. Of these, eight remained employedin the same positions at that time. (Fairweather,2004) Lacking the resources for tracking, PATHofficials were unable to say how many of the oth-ers had changed jobs and how many had experi-enced other changes in their circumstances.

2.1 Alternative tomorrows inWinnipeg’s North End

The North End Community Renewal Corpora-tion (NECRC) seeks to promote the “economic,social and cultural renewal of the North End ofWinnipeg”, by creating jobs, assisting residents toincrease their job skills, and promoting higher lev-els of commercial and industrial activity, with theaim of improving the image of the community(North End Community Renewal Corporation,2003, 1).

Recognizing that there were no career coun-selling or employment readiness training programsin the North End (Morin, 2003, 1), NECRC es-tablished the PATH resource centre. PATH – itsname is an acronym for Planning Alternative To-morrows with Hope – is funded by Manitoba Fam-ily Services and Housing, the same agency thatoperates Manitoba’s workfare program.

PATH serves social assistance recipients fromthe North End who are referred by their provin-cial social worker. They are then given two yearsto work with the NECRC and integrate back intothe workforce, but are given more time if they canshow that significant progress is being made insurmounting their barriers to employment(Johnson, 2003, 1). The PATH program offersfour kinds of assistance:1. Six computer terminals are available for use

by recipients, or anyone dropping into the


2.2 Community innovation in NovaScotia

In Cape Breton, the experimental CommunityEmployment Innovation Program (CEIP), a non-profit funded by the federal and provincial gov-ernments, challenges communities plagued withhigh unemployment to create home-grown solu-tions to tackle these problems in an effective andsustainable way. The CEIP, sponsored by the So-cial Research and Demonstration Corporation(SRDC), grew out of the belief that communityorganizations may be well suited to find solutionsto social and economic exclusion in their own com-munities (SRDC, 2002, 6). The key features ofthe CEIP are:• Communities selected for the program set up

volunteer boards to define their own needs andto identify the kinds of projects that can meetthose needs.

• Any local organization can develop a proposalfor a project to provide community employ-ment opportunities. If the local communityboard approves the proposal, CEIP partici-pants are sent to work on the project.

• These participants receive a community wage,set at $300 per week for up to three years.This salary is subject to increase with any in-crease in the provincial minimum wage. Thecommunity wage is taxable, insurable for UIpurposes, and pensionable under the Cana-dian Pension Plan.

• Participants must be available for 35 hours aweek to take part in approved activities. Whilethe principal activity is working on commu-nity-based projects, participants also spendtime in other activities including initial em-ployment assessment, basic job readiness train-ing where needed, and skill-building courses.

• Participants can switch back and forth betweenCEIP projects and other activities, such aswork in the private or public sector, at anytime during their three-year eligibility (SRDC,2003, 1).

The program, which has been operating in theCape Breton Regional Municipality since 1999,offers voluntary enrolment to 1500 participants,750 of whom give up their welfare benefits to par-ticipate in the three year long program, while theother 750 who do not take part in the programact as the control group (SRDC, 2001, 7). Thecommunity-based boards are responsible for find-ing organizations and individuals who would beprepared to sponsor projects on which the pro-gram participants could work (SRDC, 2002, 6).

For the time being, this program remains anidea to keep in mind, rather than a model, be-cause no evaluation will be available before 2008.On the basis of what is known at this writing, it isnot known whether it will suffer from the substi-tution effect, or whether it will produce anythingmore constructive than short-term, low-wage jobs.


3. A Municipal Initiative inWelfare-to-Work

wealth becomes more severe. Russ Simmonds,from his frontline vantage point as Winnipeg’sDirector of Social Services, saw the need to actcreatively to counter the growing problem.

3.1 A constructive approach

In fact, he had been seeking a constructive ap-proach to ballooning welfare rolls for some time.In 1992, he had brought forward a proposal for aseries of preventive and curative measures designedto get some people off welfare, and reduce thenumbers who would need social assistance in fu-ture, by providing them with good job and jobtraining opportunities.

Education and apprenticeship.

Pointing to a high school drop-out rate of al-most 45 per cent, at a time when 64 per cent ofnew jobs required at least 13 years of education(City of Winnipeg, 1992, 3, 5), Simmonds ar-gued that Winnipeg faced serious social problemsif it failed to take preventive action. He noted theexistence of highly successful programs in the sub-urban and exurban Transcona-Springfield andSeine River school divisions in which students at

IN THIS STUDY we found only one initiative that was fully CED-compliant and that also

succeeded in avoiding the substitution effect. It was voluntary, paid union wages, and pro-

vided training for good jobs. Ironically, this program, after achieving a series of impressive

successes, has been dumped, and has passed unheralded into obscurity.

The program was the brainchild of the formerdirector of Winnipeg’s now-defunct Social Serv-ices Department. Until April 1999, Winnipeg wasresponsible for short-term social assistance (Prov-ince of Manitoba Press Release, 1999, 1), whichwent to the “employable” unemployed, those withdisabilities expected to last less than ninety days,and single parents with children over the age ofsix (Province of Manitoba, 1994, 37). Those quali-fying for provincial assistance included those withmore serious disabilities and single parents withchildren under six.

In the early 1990s, Winnipeg’s welfare rosterswere reaching alarminglevels. During the reces-sion of 1994, one out of every 11 Winnipeggerswas receiving social assistance in some form. InDecember 1994, more than 17,000 people wereon the city’s welfare rolls, while another 25,000were receiving unemployment insurance (City ofWinnipeg, 1995a, 3). Many of the younger re-cipients had very limited work histories, educa-tion and training.

Many older recipients had experience, butwere unable to find work in the wake of plant clo-sures, plant relocations and downsizing. These dis-locations, common in the New Economy, inten-sify the problem of poverty, as the polarization of


risk of becoming drop-outs were induced to stayin school by being offered programs that combinedtraditional schooling with vocational and businesseducation.

Such programs, Simmonds’s report noted,were not available to highly vulnerable high schoolstudents in the city’s core area. It proposed thatthe city initiate a dialogue with core area schooldivisions about keeping core area students inschool, and directing them toward productive em-ployment. (City of Winnipeg, 1992, 3)

It also proposed that the city assume leader-ship by establishing its own mentorship program,targeting 200 aboriginal and visible minority stu-dents from the core area. The city would contractwith each student for a specific number of hoursof paid work each week, on the condition that thestudent stay in school and with the understand-ing that students successfully completing the pro-gram would be placed on the hiring list for cityjobs.

The report argued that, though such a pro-gram required a substantial commitment on thecity’s part, its successful operation could be usedas a way of persuading local businesses to offersimilar mentorship programs. In retrospect itcould, with its emphasis on aboriginal students,also have been seen as an excellent starting pointfor Winnipeg in the establishment of good offi-cial relations with what was to become the fastest-growing segment of Winnipeg’s population.

Job creation through job-sharing.

In another approach to providing employmentopportunities for people who might otherwise havedifficulty getting jobs, the 1992 report recom-mended that the city institute a program of job-sharing, emphasizing the recruitment of aborigi-nal people and members of visible minorities, andprovide day-care facilities at work. (City of Win-nipeg, 1992, 9-10) These measures, the reportargued, would be especially beneficial to women

with children. The recommendation was based onsuccess with job-sharing within the Social Serv-ices Department, where the women who had takenadvantage of the opportunity

… all have dependent children; they claimthat they find their jobs much less stressfulbecause they are able to spend more timeon a regularized basis with their children.They enjoy their work more because theyare enjoying their home life more. (City ofWinnipeg, 1992, 10)

The report pointed out that women had ac-counted for 62 per cent of the growth in Winni-peg’s labour force between 1971 and 1986. It alsoargued that job-sharing would not only help thosewho could benefit from flexible working hours,but also be cost-effective for the employer. Sincethis report was written, flexible working-hourshave become a New Economy cliché and a wide-spread reality of work-places everywhere. The re-port now seems to have been ahead of its time –too far ahead, as it turned out, for Winnipeg’s de-cision-makers.

Tri-level partnerships.

Another recommendation of the 1992 report– one that eventually scored some impressive suc-cesses before being abandoned – called for the es-tablishment of large-scale “work activity projects”initiated by the city and run in partnership withprovincial and federal governments. The conceptof a work activity project is enshrined in federallegislation as a permitted means of preparing un-employed people for entry or return to aworkplace.

The report recommends that the city selectneeded projects, for which funding would not oth-erwise be available, and – in negotiation with fed-eral and provincial governments as well as the Ca-nadian Union of Public Employees (CUPE) – fleshout details of the work to be done and a funding


formula. The idea was that persons receiving so-cial assistance would instead gain paid employ-ment and on-the-job training. The costs of projectscompleted would be partially defrayed by themoney all three levels of government saved on so-cial assistance for the newly employed workers.(City of Winnipeg, 1992, 10-11)

The report recommended seven possibleprojects, including such disparate items asriverbank stabilization, newspaper recycling,Assiniboine Forest maintenance and development,noxious weed eradication and a residential wastestream composition study. It provided preliminarybudgets for each. (City of Winnipeg, 1992, 12-18)

Collectively, these programs offered a long-term approach to re-integrating social assistancerecipients into the workforce in a non-coercivemanner while offering training that would havebeen useful to the participant, and projects ben-eficial to the community. The inclusion of CUPEin the negotiations would have provided a meas-ure of assurance that the substitution effect wouldbe avoided – that the jobs provided would notcome at the expense of existing jobs. In short, theproposals were both practical – as later experiencedemonstrated – and fully CED-compliant.

From the vantage point of a dozen years later,the 1992 report has a remarkably current feel. De-spite its careful attention to criteria that are im-portant from a CED perspective, the report alsodisplays an acute awareness of administrative andeconomic conventions that were only just com-ing into vogue. Job sharing, and the idea that itcan be good for both employees and employers,remains to this day a staple of economic and ad-ministrative conservatives, while often lacking thering of sincerity. Simmonds and his staff found away to make the idea work.

And even neo-conservative New Economyhardliners could hardly object to the use of neededjobs and useful job training as means of gettingpeople off the welfare rolls – though they might

well cavil at the idea of union participation andwages sufficient to support a family. Despite thesestrengths, the report was not implemented.Years later, Simmonds recalled a city councillordismissing it as “a Communist document.”(Simmonds, 2003) Whether our preference is todismiss it as Communism or as New Economyorthodoxy, the idea proved too good to be killedthat easily. In fact, a version of it had already beenimplemented, in the form of a Dutch Elm Dis-ease control program.

3.2 Attacking the Elm Bark Beetle

One of Winnipeg’s greatest natural assets is itsurban forest. Street canopies of mature Elm treesshape the character of many older neighbour-hoods. From the tops of tall buildings, whole sec-tions of the city are rendered invisible by the ur-ban forest. In 1975, the first case of Dutch ElmDisease was spotted, after having already wipedout urban forests in many mid-American com-munities. (Province of Manitoba, 2003, 1) InWinnipeg, however, the progress of the disease hasbeen slowed greatly, and the city’s urban forest re-mains a source of pride. One of the programs thathelped, for a while, to make this possible was theDutch Elm Disease control program.

Russ Simmonds initiated this program, ini-tially as a response to a serendipitous opportunity.According to him, a provincial contact identifieda $350,000 surplus in the provincial social assist-ance budget, and asked him for a program idea.Simmonds responded by suggesting provincial-municipal job creation and training initiativesalong the lines of the tri-level initiatives later rec-ommended in his department’s 1992 recommen-dations (see Section 3.1) for dealing with balloon-ing welfare rolls. The idea, which evolved into aproposal for a Dutch Elm Disease control pro-gram, made it possible for him to secure match-ing funds from the province and the city.(Simmonds, 2003).


Beginning in 1986, social assistance recipients wereselected and trained in such areas as equipmenthandling, urban forestry management, Dutch ElmDisease identification, and personal safety. (Cityof Winnipeg, 1995b, 12) The program targetedheads of households, paid union wages, and savedsocial assistance money by investing it in trainingand wages for work that was valuable to the com-munity. The chances that it would lead to long-term employment for its participants – unlike thebleakly familiar useless-job-training-and-make-work schemes – were enhanced by a city policy ofplacing employees with more than 125 days’ sen-iority on a recall list for future job openings. Inshort, the program was fully CED-compliant.

After six years, 236 former welfare recipientshad completed the program and 47 per cent ofthem had secured continuing employment withthe city. Others found work in conservation andother environmental fields, and with private com-panies such as nurseries and pruning companies(Province of Manitoba, Private Member’s Business,Res. 17, Martindale; City of Winnipeg, 1995b,12).

In carrying out this study, we were not able tosecure a detailed evaluation of the Dutch ElmDisease program, but even without that it is clearthat, by pooling their resources, the city and theprovince were able to secure the completion ofneeded work at a discount approximating the valueof the social assistance payments saved. As well,there were likely long-term savings from welfarecheques foregone by those workers who securedlong-term employment as a result of the program.

3.3 Infrastructure Renewal

In considering the Dutch Elm Disease controlprogram, the available documentation has limitedus to dealing in approximations, but more com-plete data are available for the Infrastructure Re-newal Demonstration project. It was a voluntary

program, originally intended as a large-scale ini-tiative that would have employed more than athousand people, but fiscal pressures reduced thescope to that of a demonstration project (City ofWinnipeg, 1995a, 11). Even the demonstration,however, provides evidence of the feasibility andpotential effectiveness of the kind of tri-level ini-tiative first proposed in 1992 by Winnipeg’s So-cial Services department. (Section 3.1)

Since the project was designed at the locallevel, in partnership with the City’s Public WorksDepartment, it was informed by awareness of theneeds of both the local community and partici-pants in the program. In a city with an infrastruc-ture deficit that, in the mid-1990s ran to the hun-dreds of millions – an infrastructure crisis so seri-ous that vehicle-sized street sink-holes became acommon occurrence – the case for infrastructurerenewal was easy to make. (City of Winnipeg,1998)

Simmonds presented his idea for the projectin a meeting with the federal Liberal caucus be-fore they came to power. In this meeting, he ar-gued that all three levels of government couldpotentially save social assistance money by invest-ing dollars, to be spent on wages and training, inthe restructuring and resurfacing of city roads, backlanes and sidewalks. When the Liberals came topower, they expressed interest in financing theprogram. After securing provincial funding,Simmonds took the proposal to city council, andreceived approval to proceed. (Simmonds, 2003).

Over the course of implementation, each levelof government spent $759,266 on wages for so-cial assistance recipients participating in the pro-gram, as well as their supervisors. The grossamount spent on wages was approximately $2.3million. However, when calculated against the sav-ings in social assistance money accrued at each levelof government, the project garnered $2.3 millionworth of wages for $550,000. In fact, the federalgovernment actually saved more in welfare costs


than it spent on infrastructure renewal. (City ofWinnipeg, 1995b, 11).

The reported outcomes of the project were sur-prisingly positive, perhaps in part because, in atime of high employment, a relatively large numberof capable workers were receiving social benefits.Unlike the PATH program in Winnipeg’s NorthEnd, which accepts participants facing multiplechallenges, the municipal government’s initiativetargeted young household heads, people substan-tially more likely to succeed, whose success wouldbenefit whole families.

The work took place over the summer of 1994,and, by the end of the summer, program partici-pants were working at the speed of other city crewsand producing a finished product that met regu-lar city standards (Simmonds, 2003; City of Win-nipeg, 1995b, 11). Some reports actually suggestedthat the former welfare recipients, highly moti-vated to give the lie to stereotypes about welfarerecipients, actually worked to a higher standardthan city employees. (Simmonds, 2004) As a re-sult of the project, participants gained useful train-ing, and were able to put recent employment ontheir resumes.

Participants earned union wages – $10.41 anhour, or $832.80 bi-weekly (City of Winnipeg,1995a, 14). The fact that program strategicallytargeted heads of large households might have beenthought an obstacle to success, since a family offour on welfare would have received the equiva-lent of approximately $9.50 an hour, and a familyof five more than $11 an hour (Redekopp, 1994,A1). Thus some of the workers were choosing jobs

despite the fact that welfare would have paid ap-proximately as well, even after taking into accounta city income supplement designed to maintainlow-wage workers’ incentive to secure and retainemployment.

Here again high unemployment may havecontributed to success because, especially in ad-verse labour market conditions, gaps in employ-ment history look bad for future employment.Whatever the reasons, telephones at the City ofWinnipeg were ringing incessantly with social as-sistance recipients doing everything possible to getinto the program (Simmonds, 2003; Redekopp,1994, A1). However one might seek to explainthe program’s favourable outcomes, they lend lit-tle credibility to the belief underlying workfare thatwelfare recipients can only be induced to workwith threats of dire consequences.

One of the main issues involved in securingfunding for many of these programs was the factthat the City paid union wages. The ProgressiveConservative provincial government took the viewthat this was too much to be paying social assist-ance recipients, despite the fact that it was actu-ally saving them money.

A city official reported that he and his col-leagues explained repeatedly, but to no avail, thatthe province was saving money, not only on in-frastructure and other needed projects, but alsoby reducing the financial and social costs of wel-fare dependency. The benefits of this program wentwell beyond the easy-to-measure cost savings, citysocial services officials argued. (Eagin, 2003)

The decision to favour heads of householdsfor the program was made in the knowledge that

Wage Expenditure Projected Saving inFinancial Assistance

1994-95

Net Cost [Investment]of Program

City $759,266 $319,403 $439,863

Province $759,267 $544,374 $214,893

Federal $759,267 $863,778 [$104,511] surplus

Totals $2,277,800 $1,727,555 $550,245


the whole family would benefit. A working par-ent becomes a positive role model for the chil-dren as they see their parent heading off to workin the morning. The self-confidence and self-re-spect of the whole family grows, replacing the feel-ings of desperation usually associated with receiv-ing social assistance. (Eagin, 2003) Finally, becausethe program was generated at the civic level, itresponded to community priorities and providedtraining known to lead to prospects for contin-ued employment in future.

The provincial government’s refusal to acceptsuch arguments foreshadowed later provincial de-cisions, discussed in Section 4, that allowed theinfrastructure renewal project to remain dormant,while other programs that paid minimum wagewere implemented (Province of Manitoba, 1998-1999, 32, 33).

Union resistance, which might have been an-ticipated in other circumstances, did not materi-alize in this case, again because the program was adirect response to community needs. EdBlackman, then President of CUPE (CanadianUnion of Public Employees) and Paul Moist, lo-cal President during research for this study, bothexpressed support for Simmonds’s initiatives. Theunions recognized that the Infrastructure RenewalDemonstration Project was not taking work awayfrom their employees, but instead was getting badlyneeded work done, which would not otherwisehave been attended to (Simmonds, 2003, 2; Moist,1996, Vol. XLVI No. 4).

Paul Moist, a vocal opponent of provincialworkfare (see Section 4), took Simmonds’s reporton the project to unions all across Canada as anexample of what could be accomplished. Becauseof the support Simmonds was given by union lead-ers, he was able to implement several successfuland effective programs that got individuals offsocial assistance and into the workforce, while at-tending to the needs of the city (Simmonds, 2003).

The Infrastructure Renewal DemonstrationProject was discontinued after one year as federaland provincial infrastructure money dried up, leav-ing the City unable to pick up the balance for theproposed second year. Russ Simmonds retiredfrom the City of Winnipeg before the second yearwould have taken place leaving no one to followup on the program (Eagin, 2003; Mauws, 2003,1; Simmonds, 2003).

In follow-up interviews with program partici-pants, Simmonds discovered that not one of themhad been given any sort of opportunity for train-ing while on employment insurance (EI). Thosewho inquired about academic upgrading or train-ing activities were told to wait until they were con-tacted. Not one of them reported having beencontacted. Almost all ended up back on welfarewhen their EI expired, indicating a serious prob-lem with the nature of EI delivery. (Simmonds,2003).

In fairness to EI officials, they lacked the re-sources of the City of Winnipeg, which was in aposition, not only to identify available job oppor-tunities, but to identify needs, secure funds formeeting them, and then make the jobs available,all with a view to producing training and job op-portunities for people on the welfare rolls. Inputting people on welfare together with job op-portunities, a local government is clearly in a moreadvantageous position than a federal agency.

It is less surprising that Simmonds was able toaccomplish what he did – though obviously it wasno mean feat – than that so little has been done totake advantage of the opportunity revealed by hispioneering work. Obviously, official recognitionthat local governments can play an important rolein ensuring the effective delivery of federal andprovincial programs – and in the process, makean important contribution to community eco-nomic development – has been slow in coming.2


4. Back to Workfare:Provincial Takeover

The provincial government might argue thatthese programs only achieved their impressiverecords of success because they were mountedduring a period of high unemployment, when itcould reasonably be assumed that some welfarerecipients were more than usually motivated tofind work. The fact that some of the participantsin the infrastructure renewal scheme were actu-ally prepared to work for approximately the sameamount of money as they would have received onwelfare would support that contention. However,the Dutch Elm Disease Control program, whichwas not launched in recessionary times, was alsoimpressively successful.

In any event, the suggestion that the provin-cial government cancelled the program because itwas seen as not being needed in times of high em-ployment does not stand up well to an examina-tion of the chronology of government. Neitherprogram was in operation beyond 1994, when theeconomic downturn of the early 1990s was still infull swing and one of every 11 Winnipeggers wason social assistance. (Section 3) Unless someonein the provincial government had a crystal ball,both to foretell the strong employment growth of

IF THE FEDERAL GOVERNMENT has been slow to recognize the potential of munici-

pally-driven welfare-to-work, the Manitoba provincial government has gone it one better: It

ended the city’s welfare role and replaced welfare-to-work with workfare. (See Section 1.1 for

an explanation of the distinction.) The apparent reason for its actions was a desire to follow

a trend in other provinces toward administrative simplification through provincial takeover

of welfare, but a closer look suggests that ideology played a role as well.

In 1999 Manitoba’s Department of FamilyServices followed the lead of Ontario and otherprovinces in assuming responsibility for Winni-peg’s social assistance programs (Province of Mani-toba Press Release, 1999, 1). Two-thirds of prov-inces now administer their welfare-to-work pro-grams unilaterally and all provinces have madewelfare-to-work programs compulsory. Althoughthe majority of provinces still maintain that theprograms they administer do not qualify asworkfare (Gorlick, 1998a, 7), in Manitoba’s case,the devolution upward has been intertwined andinterrelated with the deliberate establishment of aworkfare policy.

This becomes even clearer if we examine someof the details of what has happened since the cen-tralization of welfare programs. The InfrastructureRenewal Program and the Dutch Elm DiseaseControl program remain dormant. Infrastructurerenewal only lasted one year (Section 3.3) and theDutch Elm Disease Program came to a close afterthe mini-recession of the early 1990s ended andthe municipal welfare roster size dropped from17,000 in 1994 to 11,000 in 1997.


1995 and beyond, and to predict that this wouldobliterate the effectiveness of welfare-to-work, weare forced to conclude that short-term fiscal con-siderations quite simply overrode the demonstra-ble long-term financial and social benefits of theprogram.

In short, the two programs we have been ableto identify that avoided the substitution effect andwere CED-compliant have disappeared, courtesyof senior government cutbacks and provincialtakeover of social services. Two former city workprograms for welfare clients that have survived theprovincial take-over, by contrast, are compulsory,low-wage and do not offer training that is likelyto lead to better jobs in future.

One of these is the Community Home Serv-ices Program, which allows elderly people whowish to remain in their homes, but are unable todo much of the manual labour required, to ob-tain services such as lawn mowing and snow clear-ing from social assistance recipients. The other isthe Community Worker Program, which has par-ticipants performing janitorial and maintenanceservices at community centres. (Bentley, 2003)Even when the city controlled these programs, theywere not intended as entrées to secure employ-ment.

City officials understood that neither offeredlong-term prospects or job training remotely com-parable to the opportunities available through theDutch Elm Disease and infrastructure mainte-nance programs. Both schemes were intended toenable unemployed singles to fill gaps in employ-ment, a contrast with the Dutch Elm and infra-structure programs which were designed for peo-ple with families, and intended to have the multi-plier effect of giving several people a chance toescape poverty and dependence while gaining in-creased self-respect. (Province of Manitoba, 1994-95, 35; City of Winnipeg, 1995b, 15)

When the city ran them, therefore, the pro-grams were voluntary and it was understood thatthey were no more than a temporary stopgap.(Simmonds, 2003) In other words, they had someof the characteristics of workfare, but other meas-ures were in place to provide a longer-term wel-fare-to-work approach to the problems of socialassistance recipients. When the programs passedto provincial jurisdiction, they became part of theprovincial “Making Welfare Work” initiative andlost their voluntary character. In short, they be-came workfare writ large – compulsory positionsthat offered little hope for a better future.

The provincial government, which had ob-jected to the payment of union wages in the infra-structure renewal program (Section 3.3.), had wonthe day. The provincial takeover of welfare inManitoba signified much more than just admin-istrative efficiency. It signalled the advent of poli-cies dominated by the ideologically-driven, unsub-stantiated belief that welfare recipients will re-spond, not to incentives for betterment of theirlot, but only to compulsion. The province haddumped welfare-to-work and replaced it withworkfare.


5. What Can Be Learned?

demonstrated the existence of the substitution ef-fect.

In those cases, the government was subsidiz-ing existing jobs rather than inducing the crea-tion of new ones. The Manitoba government’sMaking Welfare Work programs are if anythingeven less constructive. They offer temporary jobsand little or no hope for a transition to better job.

Community-based programs in Quebec ledto the creation of new jobs and provided skillstraining, but the usefulness of these skills in se-curing future employment proved questionable.Community-based programs of Winnipeg’s NorthEnd Community Renewal Corporation providedstrong support for welfare recipients and helpedthem secure private-sector positions, but much ofthe work they secured was low-wage service work.

Cape Breton’s Community Employment In-novation Program funds the creation of jobs atthe community level and provides more than mini-mum wage to its participants. No evaluation ofthe program will be available before 2008. As aresult, we cannot rule out the danger of the sub-stitution effect. Nor can we determine whetherthe program will achieve the longer-term integra-tion of participants into the workplace.

Taken together, these programs represent agreat deal of effort, and major constructive ele-ments, but mixed results. None of them, whetherimplemented as provincial or community-basedprograms has proven both fully CED-compliantand invulnerable to the substitution effect. Againstthis background, Winnipeg’s Dutch Elm DiseaseControl and Infrastructure Renewal programs

OUR STUDY set itself the objective of identify-ing programs that reconnected social assistance re-cipients with the workplace, and offered them aserious chance to escape dependence, improve theirlives, and build their self-respect by fulfilling thefollowing conditions:• Voluntary participation. Incentives, rather

than compulsion, are used in programs de-signed to facilitate workplace participation.

• Usefulness to the community. The jobs are agenuine benefit to the community, not make-work that produces net costs instead of ben-efits and does little to boost the self-respect ofthe workers.

• Utility for the participant. The jobs providetraining that is capable of leading to long-termemployment at wage levels significantly higherthan minimum wage.

Our assessment of Quebec government pro-grams led us to add another criterion:• Avoidance of the substitution effect. The pro-

gram creates jobs that would not otherwisebe available, so that participants are not, ineffect, depriving others of work.

By these admittedly demanding standards,most of the programs we looked at had some short-comings. Quebec government programs fundedentry-level positions that tended to be unstableand provide little in the way of useful training. Inaddition, a finding that about half of the employ-ers participating in the program would have hiredworkers with or without government subsidies


appear as a remarkable achievement. Evaluationsof them suggest that they were both fully CED-compliant and unlikely to produce the substitu-tion effect.

Both of these programs provided good jobsand useful job training at wage rates substantiallyabove the provincial minimum. Follow-ups of par-ticipants in the Dutch Elm Disease scheme sug-gest an impressive record of long-term reintegra-tion into the workplace, and, despite the absenceof a follow-up, there is no reason to suppose thatparticipants in the infrastructure program did lesswell.

In addition to these benefits, the programs en-joyed the inestimable advantage of political sale-ability. They not only produced the difficult-to-calculate but undoubtedly significant financial andsocial benefits of helping families to remove them-selves from poverty and dependence; they also al-lowed the city to undertake needed projects at asaving to taxpayers. It is a rare case of a programthat can be defended equally well as a social pro-gram and as the fiscally prudent thing to do.

Why did municipal government programssucceed so impressively, while both provincial andcommunity-driven projects had a spottier record?On reflection it seems clear that no organizationis better placed than a municipal government toidentify both available job opportunities and com-munity needs, secure funds for meeting them, andthen make the jobs available. In addition, Winni-peg, in the 1980s and 1990s – because of its re-sponsibility for short-term welfare – was also wellplaced to identify people who could benefit fromthe programs and match them with appropriateopportunities.

Despite those advantages, the municipal gov-ernment did not act on its own. Both infrastruc-ture renewal and the Dutch Elm Disease programrelied on funding from senior governments. In-deed, this is critical to the success of locally drivenwelfare-to-work because it is the senior levels of

government that are garnering the savings on wel-fare payments. Winnipeg’s experience suggests thatwelfare-to-work is feasible and that it can deliverimportant benefits to some proportion of socialassistance recipients, to the wider community, andto the taxpayer, but that intergovernmental co-operation is essential to its success.

Can we learn from these successes today? Sincethe trend in social welfare is its devolution up-ward from municipal government, the scope for arepetition of the experiences of the late 1980s andearly to mid 1990s is narrowing. Such municipalinitiatives as those of the Winnipeg Departmentof Social Services are not likely to be repeated.What seems feasible is the development of locallydriven welfare-to-work schemes upon the initia-tive of the senior governments.

On the face of it, there seems to be no reasonwhy it would not be possible for the federal gov-ernment and provincial governments to concludeagreements in which the senior governments agreeto finance local initiatives that can be demonstratedto provide good jobs and useful job training. Sen-ior governments could, if they wished, limit theamount of their funding to an amount equal totheir savings on welfare.

The senior governments could put out callsfor proposals, which might come from either mu-nicipal governments or community organizations.A federal-provincial secretariat could vet the pro-posals and fund the ones that provided decent jobs,useful job training and community benefits.

Senior governments would be providing onlyan advance on money they would save and thecommunity, welfare recipients, and their familieswould benefit immediately. Taxpayers would ben-efit as well, from the completion of projects at adiscount, and from the longer-term savings as so-cial service recipients attained financial independ-ence. It is a policy idea with an already establishedrecord of success and much promise for the fu-ture.


1 To be sure, the federal government has beentaking other, sometimes faltering, steps towardtapping local initiative in meeting federal gov-ernment objectives. Two cases in point are thefederal Homelessness Initiative (Leo and Au-gust, 2004) and the federal-provincial immi-grant nominee program. (Leo with Mulligan,2004)

Endnotes


References

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City of Winnipeg: Social Services Department:Employment, Training and Education Services.March 1995b. Initiatives and Partnerships.

City of Winnipeg; Social Services Department:1997 Annual Report.

Collins, Jerry. January 1996 “No Time for Wel-fare Myths” Alberta Report/Newsmagazine. 23 (3),42-43.

Eagin, Joe: Community Resources Co-ordinator/Emergency Co-ordinator for Social/ Public Serv-ices. June 16, 2003. Telephone Interview.

Employment and Income Assistance Act. Continu-ing Consolidated Statutes of Manitoba. CCSM c.E89.

Gorlick, Carolyne, and Brethour, Guy. 1998a.Welfare-to-Work Programs in Canada: An Overview.Ottawa: Canadian Council on Social Develop-ment.

Hardina, Donna. 1996. “Workfare in the U.S.:Empirically-Tested Programs or Ideological Quag-mire?” Workfare: Ideology for a New Underclass. Ed.Eric Shragge. Toronto: Garamond Press Ltd., 131-148.

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Jackson, Robert and Jackson, Doreen. 2001. Poli-tics in Canada: Culture, Institutions, Behaviour andPublic Policy. 5th Ed. Toronto: Pearson.

Leo, Christopher and Martine August. 2004. “TheFederal Government and Homelessness: Commu-nity Initiative or Dictation from Above?” Winni-peg: Annual Conference, Canadian Political Sci-ence Association. June.

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