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Aboriginal People in Manitoba 2000 Chapter 6 : Labour and Income

When we speak of a low-income household whose major source of income is government transfers, this household almost certainly is relying either on social assistance or on various old age benefits. While the net effect of government transfers is a redistribution of income toward the lower income sectors, individual government transfer programs differ greatly in their redistributive effect.

In 1991, 13% of Canadian households received income under the Statistics Canada low-income cut-off (LICO). These households received 68% of social assistance expenditures,²³ 38% of child tax credits and 26% of OAS/GIS/SPA (old age) benefits. However, they received just 14.5% of Canada/Quebec pension plan benefits, and 11.5% of Unemployment Insurance benefits.²⁴ Child tax credits are not a primary source of income, and few Aboriginal people are over age 65. For the vast majority of Aboriginal people, dependence on government transfers means dependence on social assistance, supplied through the Province off reserve and the federal department of Indian Affairs on reserve.

More individuals and families receive social assistance at some point during the year than the number who indicate on the Census that transfer payments are their primary source of income year-round. On reserve in Manitoba in 1996, 35.6% told the Census that transfers were their primary source of income. However, the 1995 Indian Affairs social assistance rate on reserve in Manitoba, “defined as the monthly average number of beneficiaries divided by the total on-reserve population for that year,”²⁵ was about 53%. In other words, in any given month, 53% of on-reserve families are on social assistance for at least part of the month.

INAC social assistance dependency rates vary widely across the country, from 20-30% in Quebec, Ontario and Yukon, to 48-58% in the four western provinces, to a high of almost 75% in the Atlantic Provinces. These rates, on a national basis, have been increasing each year, from a national average of 35% in 1982 to 45% in 1994. Because the on-reserve population is also growing rapidly, national expenditures have almost doubled. These trends are expected to continue in the foreseeable future.

However Manitoba, while it has one of the higher on-reserve social assistance dependency rates, has seen little or no increase in this rate since the early 1980s. Manitoba’s rate fell from 59% to 50% in 1981-83 and, since then, has fluctuated around 55% every year. Increases in the total number of recipients have mirrored increases in the overall on-reserve population, and there is little reason to believe Manitoba’s rate will increase between now and 2010.

By contrast, very high rates of increase in social assistance dependency have occurred in some other provinces, especially Alberta where the rate has increased from under 30% to over 50% in 1982-1994. The Alberta rate is forecast to surpass Manitoba/Saskatchewan rates between now and 2010. B.C. is also expected to increase its dependency rate. The rate in Atlantic Canada, already extremely high, is forecast to increase to over 85%.²⁶