Down but Not Out: Reforming Social Assistance Rules that Punish the Poor for Saving

John Stapleton
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John Stapleton: St. Christopher House

No 93, e-briefs from C.D. Howe Institute

Abstract: Reform is required for social program rules that prevent the poor from saving in Registered Retirement Savings Plans (RRSPs) and Tax Free Savings Accounts (TFSAs), according to this study. The author says that encouraging asset accumulation, even in small amounts, is crucial in helping to lift people out of poverty. Yet most Canadian welfare, disability and social service programs deny or cancel benefits if applicants or recipients place a modest level of savings in an RRSP or TFSA. Barring a province-led effort at reform, says Stapleton, the federal government should take the lead by calling on provinces and territories to exempt meaningful RRSP and TFSA amounts from their welfare asset rules, leaving individual jurisdictions to decide the appropriate levels.

Keywords: Social Policy; Registered Retirement Savings Plan (RRSP); Tax Free Savings Account (TFSA); social assistance (search for similar items in EconPapers)
JEL-codes: H53 I38 (search for similar items in EconPapers)
Pages: 6 pages
Date: 2010-03
New Economics Papers: this item is included in nep-age
References: View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Published on the C.D. Howe Institute website, March 2010

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