Canadian Social Research Links

- A Reality Check -

Updated to October 28, 2010

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(Posted online October 11, 2010)

Online awareness campaigns and petitions railing against injustice are a daily occurrence now that we're all plugged in and networking.
Sometimes, however, those campaigns are ill-advised and based on disinformation.

Two classic cases in point:

* "New immigrants to Canada receive more financial assistance than Canada's Old Age Security pensioners!!"
- see Canadian Refugee Pensions Protest Hoax


* "Boycott [insert oil company name] to lower gas prices!"
- see Oil Company Boycott Email


"WORKING JOE vs. WELFARE JOE" is the latest case of self-righteous indignation founded on disinformation.
A visitor to my website forwarded this email to me last week asking if this could possibly be true.

NOTE : Despite the title, the rant below isn't at all about how well off people are on welfare compared to hard-working Canadians. It's a lament about (1) people who rip off the income tax system by hiring people and paying them under the table and (2) those people who work under the table to avoid paying income tax. I agree totally that people must declare ALL income from work under the Income Tax Act. It's only fair.

It's nonetheless worth reviewing the facts in the scenario of Working Joe and Welfare Joe to set the record straight and, hopefully, to dissuade people who receive the message below in an email from spreading this crap to an even larger audience. If you receive an email with the (original) text below, feel free to refer the sender to this page.

The complete original email that was being circulated is copied below in regular (black) text.
Comments in red are by me (Gilles), based on 30 years of research on Canadian welfare programs.


To: Everybody in the frikkin' world!
From: Wiseguy Joe <====================Fictitious character
Subject : Working Joe and Welfare Joe
October 10, 2010

You have two families: "WORKING JOE " vs "WELFARE JOE".
Both families have two parents, two children, and they live in Canada.

Working Joe works in construction, has a Social Insurance Number and makes $25.00 per hour with taxes deducted.
Welfare Joe does not work, has a Social Insurance Number, and gets paid $15.00 per hour "without leaving the house".

[NOTE : The above statement didn't make any sense to me, because welfare is not paid by the hour, and this is the first mention of an hourly rate of pay that seems plucked out of thin air for someone on welfare "without leaving the house". In fact, if you read the text in the yellow box below, you'll see that the $15 is actually money paid illegally under the table not to someone on OW, but to someone who is not declaring their income.]

Ready? Now pay attention...
Working Joe : $25.00 per hour x 40 hours = $1000.00 per week, or $52,000.00 per year.
Now take 30% away for provincial and federal taxes.
Working Joe now has $31,231.00 net.

Working Joe makes $52,000 per year. The total (fed+prov) income tax that Working Joe would pay with a spouse and two kids in Ontario (where I live) in 2010 on $52,000 is $9,800 (or 18.8%, NOT 30%), leaving him with $42,200 after income taxes, not $31,231 net.

In addition, Working Joe would be entitled to federal child benefits of $194/month on behalf of his two kids from the Canada Child Tax Benefit.


Welfare Joe : $15.00 per hour x 40 hours = $600.00 per week, or $31,200.00 per year.
Welfare Joe pays no taxes.
Welfare Joe now has $31,200.00 net.

Welfare Joe and his family would be in heaven, relatively speaking, if their annual welfare income were even close to $31,200 per year. Welfare benefit levels are set by each provincial government; in the most generous province (PEI), the annual income of a two-adult, two-child household is $23,000 and that includes any extra federal benefits paid on behalf of the kids. At the other end of the scale, the same family on welfare in New Brunswick would have an annual income of $19,000. Even using the higher figure, Welfare Joe's annual income would be $8,000 less than the writer suggests.

October 16/10 update:

The statement regarding Welfare Joe getting paid $15.00 per hour "without leaving the house" perplexed me, because NO Canadian jurisdiction pays welfare on an hourly basis. When I Googled "WORKING JOE vs WELFARE JOE", I found a whole whack of links to various versions of this urban legend, including one called "Joe Legal and Jose Illegal", where both families have two parents, two children, and live in California. In this scenario, Jose Illegal "works in construction, has NO Social Security Number, and gets paid $15.00 [per hour] in cash under the table."

It appears that at some point in the life cycle of this urban legend, someone decided to adapt the yarn to the Canadian welfare/working poor context, but didn't bother explaining how someone could get paid $15.00 per hour by welfare "without leaving the house". In fact, the $15/hr isn't from welfare - it's from an unscrupulous employer who pays Jose/Joe under the table. Thus did Jose Illegal evolve into Welfare Joe, but the rest of the story is pretty much plagiarized directly from the Jose Illegal text.

In fact, the rant isn't at all about how well off people are on welfare compared to hard-working Canadians. It has nothing to do with the amount of money a person makes on welfare compared with the income of a working person. It's a lament about (1) people who rip off the income tax system by hiring people and paying them under the table and (2) those people who work under the table to avoid paying income tax. I agree totally that people must declare ALL income from work under the Income Tax Act. It's only fair.

[ Related link : Joe Legal and Jose Illegal ]


Working Joe pays medical and dental insurance with limited coverage for his family at $600.00 per month, or $7,200.00 per year.
Working Joe now has $24,031.00 net.
Welfare Joe has full medical and dental coverage through the Provincial and local clinics at a cost of $0.00 per year.
Welfare Joe still has $31,200.00 net.

If Working Joe is employed at $25 per hour, chances are pretty good that his construction company offers subsidized or discounted health and dental insurance. If Working Joe's employer *doesn't* offer insurance AND if he wants total coverage for his family of four, Blue Cross Ontario offers him the Cadillac package : Core Health, Prescription Drugs, Dental and Hospital Benefits, for $428 monthly --- far more than the limited coverage that's offered to households on welfare, and somewhat less than the $600 suggested by the author of this rant..

Welfare Joe's health benefits under Ontario Works (the provincial welfare program for applicants without a disability) are summarized in the two following sections of the Ontario Works Procedures manual:
* Summary of Benefits
* Health Benefits

Welfare Joe can't get even close to "full medical and dental coverage".
The actual amount of medical and dental coverage varies from one municipality to another in Ontario*, because much of that coverage falls under the category of "discretionary". Municipalities can choose to offer less coverage, or no coverage beyond emergencies in the case of adults, while making more services available to children in welfare households.
* In other provinces, it's the provincial government that decides what health/dental services will be offered to people in welfare households throughout the jurisdiction. As in Ontario, the range of benefits is often limited to emergency care for adults, but there are more preventive services available for kids in welfare households.


Working Joe makes too much money and is not eligible for welfare.
Working Joe pays $500.00 per month for food, or $6,000.00 per year.
Working Joe now has $18,031 net.
Welfare Joe has no documented income and is eligible for welfare.
Welfare Joe still has $31,200.00 net.

Recapping from above:
* Working Joe makes $52,000 gross per year, which leaves him with $42,200 after federal and provincial tax.
* Welfare Joe makes $$23,000 per year in PEI, the most generous province.

Curiously, in the "food" example above, Working Joe's annual income is reduced by the $6,000 he paid for food, but Welfare Joe's income remains the same. Apparently, Welfare Joe should give Working Joe some tips on how to stretch his food dollar.
<hint of sarcasm.>


Working Joe pays rent of $1,200.00 per month, or $14,400.00 per year.
Working Joe now has $9,631.00 net.
Welfare Joe receives a $500.00 per month federal rent subsidy.
Welfare Joe pays out that $500.00 per month, or $6,000.00 per year.
Welfare Joe still has $31,200.00 net.
Working Joe pays $200.00 per month, or $2,400.00 for auto insurance.
Working Joe now has $7,231.00 net.
Welfare Joe says, "We don't need no stinkin' insurance!" and still has $31,200.00 net.

There is no "federal rent subsidy".
The $660/mo. maximum shelter allowance for a four-person family is included in the $23,000 total annual welfare income as noted above, and no additional amount is received for shelter from any source.

Some welfare families (about 10-12%) live in subsidized housing, where their shelter cost is equal to 30% of their maximum monthly welfare benefit. The shelter portion of their welfare cheque is then reduced so that it covers only the actual cost of shelter.

The real advantage in acquiring a place in social housing in my province is that Ontario Works pays a maximum monthly shelter allowance of $660 for a four-person household, an amount that's included in the same cheque as the family's monthly support allowance ($429). The shelter allowance *may* be adequate to house four people in a rural or remote or sub-standard setting, but in an urban context, $660 doesn't even rent a studio apartment anywhere, let alone an apartment for four in a decent neighbourhood.

For each dollar above the $660 shelter portion of the welfare cheque that's spent on shelter, there's a dollar less for food and other necessities of the family. Many welfare households living in the private market are paying out 60-75% of their total welfare cheque on shelter. In fact, Welfare Joe's TOTAL monthly welfare allowance (just under $1,100) is $100 less than the amount that Working Joe pays out in rent alone.

As he did for food costs above, the writer of this rant errs in saying that Welfare Joe still has $31,200 net after paying shelter costs. Not so - Welfare Joe's income is reduced when he pays for his family's shelter, just like Working Joe.

Also, it's possible that Working Joe's getting stiffed on his $200/month car insurance premium. Unless he drives a late-model high-end luxury car or he's been convicted of drunk driving, the premium he's quoting is right out to lunch. Besides, most families on welfare can't afford to own a car. And, just for the record, even if Welfare Joe does own a car, he can't say that he "don't need no stinkin' insurance, because it's the law --- Every province has a minimum auto insurance coverage law. Of course, the rant author *could* be implying Welfare Joe and his kind would drive a car even without insurance AND knowing that it's illegal.


Working Joe has to make his $7,231.00 stretch to pay utilities, gasoline, etc.
Welfare Joe has to make his $31,200.00 stretch to pay utilities, buy gas, prepaid cell phone card, (alcohol/cigarettes) and play at the Casino.

...and, while you're tarring everyone on welfare with the same brush, don't forget the holidays in Florida and the 60" plasma TVs!

Working Joe now works overtime on Saturdays or gets a part time job after work.
Welfare Joe has nights and weekends off to enjoy with his family & friends.

Working Joe and Welfare Joe's children attend the same school.
Working Joe pays for his children's lunches while Welfare Joe's children get a government sponsored lunch.

And we wouldn't want kids to have a nutritious lunch so they can learn and grow into God-fearing, tax-paying citizens like "us", eh?

Working Joe's children go home after school, while Welfare Joe's children have an after school ESL program provided free.

...and we definitely don't want them learning our language and taking our jobs, now do we?

Working Joe and Welfare Joe both enjoy the same police and fire services, but working Joe paid for them with his taxes and Welfare Joe did not.

Do you get it, now?
If you support any politician that supports our welfare system, you are part of the problem!
It's way PAST time to take a stand for Canada and Canadians!!


Comment by Gilles:

The Working-Joe-vs-Welfare-Joe argument is as old as welfare itself, the first evidence of which dates back to the Roman Empire.

One of the basic tenets of the English Poor Law of 1834 was the principle of 'less eligibility' : to discourage people from applying for poor relief in those days, the legislation stated that working conditions in the workhouse (where poor relief was earned) had to be worse than the worst job possible in the outside labour force. In more recent times, the philosophy has evolved (mercifully...) --- the principle of less eligibility means that a person should always be better off in the paid labour force than on welfare. The National Council of Welfare's series of reports entitled Welfare Incomes explores the subject thoroughly, and it includes comparisons of welfare incomes with average incomes and other income benchmarks. Their finding: In ALL Canadian provinces and territories, the gap between the maximum welfare assistance available and the income from a minimum-wage job is a strong incentive for people to stay in the work force, if they can.

Scandinavian Working Joes understand that Welfare Joe is "there-but-for-the-grace-of God go I..." , and thus support for welfare state programs is strong. In Canada, we've tended historically toward a Scandinavian-type welfare state, but the American self-sufficiency model of welfare --- tougher to qualify, lower benefits, welfare bashing, etc - seems to be prevailing in Canada since the mid-1990s.

The irony of it is that the loudest welfare bashers and critics of the system are often the blue-collar workers in fragile industries who are but one or two paycheques away from financial ruin themselves. Andrew Coyne, national editor of Maclean's Magazine, summed it up best when he (the social and fiscal conservative) said something like : "The ideal welfare system is the best one that could be in place if I were ever to need it."

Related links

Canadians precariously close to financial instability, study finds
September 13, 2010
Six out of 10 Canadians are living paycheque to paycheque and most are one pay slip away from financial instability, according to a new study. On Monday, the Canadian Payroll Association reported that of 2,700 Canadians surveyed 59 per cent are stretching their pay to the limit and expect they would be in financial difficulty if their pay was cut or delayed by one week. That figure is unchanged from last year. Dealing with debt is also top of mind, the study showed. (...) In May the Certified General Accountants Association of Canada reported that the amount of household debt across the country reached a new high of $1.41 trillion in December 2009. About six out of 10 Canadians said even though their debt load had increased they felt they could manage it or take on more.
Toronto Star

Related links:

Canadian Workers living from paycheque to paycheque
Employees worried about the economy, debt and retirement
(PDF - 1.3MB, 35 pages)
August 2010
TORONTO (September 13, 2010) – A major national survey of working Canadians, released today, shows that employees continue to live paycheque to paycheque. They are concerned about how interest rates and the economy will affect their personal finances and retirement.
Canadian Payroll Association
The Canadian Payroll Association (CPA) has been representing employers’ payroll interests since 1978, through its mission of Payroll Leadership through Advocacy and Education and its values of Community, Professionalism and Authoritative Knowledge


Plus ça change, plus c'est la même chose.*
[*Translation: ]
In 1995, the federal government announced that the Canada Assistance Plan (federal cost-sharing of approved welfare costs) would be terminated in April 1996 in favour of the Canada Health and Social Transfer, a block fund that would see less federal cash flowing to the lower order of government for welfare. In return, there would be no conditions for the cash from Ottawa except for a ban on a residency requirement for welfare eligibility purposes.
For links to more detailed information about the transition from CAP to CHST, go to the
Canada Assistance Plan / Canada Health and Social Transfer / Canada Social Transfer Resources page:
I was employed as a researcher in the federal government at the time, and I was invited in the summer of 1995 to attend a roundtable with some academics, some NGO people and some labour movement reps in the boardroom of the National Council of Welfare here in Ottawa. Over the course of a day-long session, the group discussed what national standards Ottawa might/should impose on the provinces and territories to qualify for federal contributions to provincial/territorial welfare costs. I can't recall any great resolutions being crafted or a plan being hatched --- but I do remember a senior person from a national union stating bluntly that the majority of her union's rank and file were one or two paycheques away from financial crisis. And yet, she said, her union members were consistently and viscerally critical of people on welfare and how generous they perceived the welfare system to be. That's what we're fighting in our own union, she said - the power of the right-tilting media that can influence many rank-and-filer union members to trash the very system that would be there to help them if they were destitute.
I don't think things have changed much.


[The section immediately below
was added on October 28, 2010)


So why do we need welfare, anyway?

"Arguments for welfare

The basic arguments for collective provision are:
* humanitarian. Concerns about poverty and need have been central to many developments.
* religious. Several of the world's major religions make charity a religious duty. Beyond charity, Catholicism recognises a duty of social solidarity (or mutual social responsibility); Judaism, Islam and Lutheran Christianity require collective responsibility for one's community.
* mutual self-interest. Many welfare systems have developed, not from state activity, but from a combination of mutualist activities, gradually reinforced by government.
* democratic. Social protection has developed in tandem with democratic rights"

Introduction to Social Policy


The Bottom Line:

The poor and the disadvantaged have been around since the dawn of time, and they're not about to go away soon. Welfare programs were conceived centuries ago, and the social safety net remains an important part of our modern democratic society here in Canada, as a means of ensuring that everyone is entitled to a minimum share of our national wealth to provide themselves with the essentials for survival.

The people who send "joke" emails containing blatant errors and falsehoods like the Working Joe - Welfare Joe email are often found in line at the welfare office, after their job in the automobile industry has disappeared and they've run out of Employment Insurance. Ironic then that they should be so venomous when referring to a system that would be there in their own time of need...

The bottom line : Always check your facts before going off foaming at the mouth because of some crap you read in an email.





To search the complete
Canadian Social Research Links website ,
use the text box below:

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