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November 16, 2021

Does Canada's welfare system need an overhaul?

Last month, when EverydayMoney wondered if, to ensure no Canadians could take advantage of the program, it would hurt to drug test recipients of unemployment benefits, you guys spoke up.

The consensus: yes, the benefits system is flawed (and may provide an incentive for Canucks to get cozy not working) but if there’s to be anything in need of reform, it’s Canada’s welfare structure.

Where employment insurance is concerned, out-of-workers have paid into the program, MSN readers said. Welfare, at least in the national perception, is just free cash to those who don’t want to work.

Certainly, the circumstances surrounding our country’s welfare system may not be that cut and dry, yet even the most Liberal Canadian would concede there are recipients perhaps not totally in need of the support. Critics of Canada’s welfare program are in no short supply.

Of course, that’s getting ahead of ourselves. The inspiration for this post was Britain’s highly-publicized plan last week to overhaul its national welfare system.

Long slammed for being “more generous” than it needs to be, according to the Washington Post, England will move to cut $128 billion in spending over the next four years – starting with its “overly paternal state system.”

The key points of the plan:

1) All of Britain’s benefit programs – disability and child assistance payments, etc. – will be rolled into one universal payout system.
2) Recipients who turn down more than three job offers may be penalized by losing their benefits for up to three years.
3) Further, recipients unable to find work may be forced to perform unpaid community service.

No matter where you fall on the political spectrum, those last two points, specifically, seem to fall in line with what the world needs, post-recession: a tougher stance against welfare cheats, ensuring taxpayer assistance goes where it’s actually needed.

Do you think Canada needs to perform a similar overhaul of its welfare system, tightening the payout qualifications and holding recipients accountable for their job prospects?

By Jason Buckland, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...