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'Perverse' Rules Glitch Impoverishes EI Recipients

Welcome to Chiu Yin Wong's nightmare, increasingly common.

By Andrew MacLeod, 2 Jul 2009, TheTyee.ca

Chaplin Cog

'Systemic issue': Crushed between gears of welfare and EI.

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A federal government official has told Vancouver resident Chiu Yin Wong that his next Employment Insurance cheque will be for just $26.

Yesterday, Wong's rent of $375 was due.

He's stuck and the government offices, both provincial and federal, that should be helping are instead making things worse.

As more people turn to EI and welfare for help during the recession, it's a story that's becoming increasingly common, says an advocate who works with people in Vancouver's Downtown Eastside.

"How can I afford life?" Wong asked over the phone. "I'm way down now. Very bad position."

'They don't care'

Wong worked for 17 years as a cook and said he would like to be working now. "I'm looking for work," he said. "I like working."

When he lost his job, he was eligible for EI from the federal government, but while he waited for payments to start he took emergency help from the British Columbia Housing and Social Development ministry.

Once his EI payments started, the welfare ministry wanted to be repaid. As he put it, "The welfare office, they take it back."

Like others in his situation, Wong signed a form saying the province would get paid back from his EI cheques. He did not realize, and the form does not state, just how fast the province would want its money back.

Wong is eligible for $330 every two weeks in EI payments. His last cheque though, after B.C. took its share, was $62. On the one that he expects this week the province will swack off $304, leaving him with $26 and far short of covering his rent.

Within weeks of helping Wong the province will have been repaid, but Wong's left where he started—with no money to take care of himself at a time when he's trying to look for work.

He's raised the issue with the offices that administer both EI and welfare, but to no avail. "They don't care," he said. "They don't care about the people."

Spokespeople in neither Rich Coleman's ministry of housing and social development in B.C. nor Diane Finley's human resources and skills development Canada ministries responded to questions by publication time.

Systemic issue

Kirsty MacKenzie is an advocate with the Downtown Eastside Residents' Association who has been helping Wong. He is one of three people she's worked with recently who has had a similar problem, she said.

"It seems to be a familiar pattern," she said. "It seems like it's a systemic issue."

On June 12 MacKenzie represented one of her clients at a B.C. Employment and Assistance Appeal Tribunal hearing.

The 46-year-old man, who MacKenzie said requested that his name not be used in print, worked as a construction labourer for $10 an hour until January 13, according to a submission filed as part of the hearing. When the job ended he applied for EI, as well as emergency welfare from the province to get him through until the EI cheque came.

The province gave him $595 on January 21, with the agreement he would pay it back through his EI payments.

He was eligible for $193 a week in EI, but for each of the first three weeks of February he received just $45 after the province was repaid.

By the middle of February he needed help from the welfare ministry again. They gave him another $595, but started taking back even more money.

"It just created this escalating cycle," said MacKenzie.

In February he received a total of $275 from EI, with the province taking $497. In March he got $204, while the province's share was $761. For some weeks he received not a penny from his EI cheques, which instead went straight to the province.

Clawback counts as 'income', client cut-off

MacKenzie's client might have carried on this way, supplementing the small amount he received from EI with money from the province, but in May the provincial government refused to give him any more welfare. By their calculation, he was receiving too much money.

Here's why: The ministry counts the money it was clawing back as income. In March, for example, the man officially had income of $965 from EI, despite the fact he barely saw $200 of it. That income made him ineligible for welfare.

The panel that heard MacKenzie's appeal in the case saw her point, but ruled that Coleman's ministry had interpreted the law correctly even though the outcome was "perverse".

"The Panel acknowledges that the very method by which the Ministry recovers money owing in this case, is causing the need for further income assistance," the three-member panel found. "The Appellant now receives too much income from Employment Insurance to qualify for Income Assistance, but the quantum of net income, after deductions, is impossible to live on."

They found, "The outcome is perverse, and causes significant hardship to the Appellant, but the legislation is clear."

If the legislation is creating perverse outcomes, it needs to change, said DERA's MacKenzie. There is nothing requiring the ministry to recover its money so quickly, she said. It could take back less each week and still get its money before a person's EI runs out.

"The Ministry's practices show complete disregard for the vulnerable position people are already in when they apply to access welfare while awaiting EI," she said in her initial e-mail to the Tyee. "The Ministry is well aware of the hardship caused by these recovery practices, but nothing is being done, and people are being abandoned by the Ministry."

And while the federal and provincial bureaucracies have put Wong and MacKenzie's client who lost his appeal in tough situations, it could get worse for them as it has for others. MacKenzie had a third client in a similar spot. She's lost touch with that client and figures he's become homeless.

Related Tyee stories:

[Tyee]

Andrew MacLeod is The Tyee's Legislative Bureau Chief in Victoria. Reach him here.

19 Comments:

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  • alive

    2 years ago

    about working for peanuts.

    One sad aspect is that people who work for say $10 an hour, have no reserves at any time.

    That means that the second work stops they are immediately broke!

    There can be many reasons why a person can not keep working, and we cannot blame the current recession altogether.

    People do become stressed, sick, have home emergencies, and what not, that prevent them from working to capacity on occassions.

    That, and of course lay-offs, shorter work weeks etc. can spoil a careful budget in no time.

    The government mix-up here is not surprising, there never was any intention to be of actual help there.

  • Jeffrey J.

    2 years ago

    Entire System is Perverse

    As our neocon regimes grow, laws and rules for the public are becoming more and more perverse. This also applies to most legislation and access to our court system. A re-reading of Bleak House perfectly captures where we're headed. An entire society inextricably tangled in its own anchor chain, benefiting the rich, punishing the rest of us. Unless people are willing to turn off their TV's and become involved in our communities, it is likely to get worse. Great coverage!

  • verso

    2 years ago

    Sickening

    "As our neocon regimes grow, laws and rules for the public are becoming more and more perverse. "

    And this from a government that bragged about how much "red tape" they cut for business. I guess to BC Liberals, stupid and archaic laws only apply to business. After all, welfare and EI recipients have no money to donate to the BC liberals, so why help them?

    Best place on earth, indeed.

  • WHAT

    2 years ago

    People should shut off their TV's and pay attention.

    If the Boomers would stop and pause for a second and remember that their peers are at the helms and control of society at the moment. All should remember that common sense over rides/authority. Imagine! if that generation (my parents) would re-engage fully, what mountains they could move, if they would add 'monitoring the present 'state of mankind to their list of things to do in retirement that would be much appreciated. The notion of retirement doesn't really exist in nature. Not saying it can't exist in mankind or shouldn't.....just can't forget...you still have to look both ways before you cross the street, even in retirement'...

    The internet is there, easy access. Computers have been around for 20 years, they are easier then ever to use, click, type, read. Blogs are there, you can start voicing opinions, tell a peer, and so on. I know a lot are frustrated! Other younger generations have to help and lobby our parents they are a good common sense generation, let's show them how easy it is to voice their opinions online...Public forums over riding "authority" in its present state.

    Welfare and EI systems are not bridging correctly and it is obvious. I agree everyone should pull their weight, but circumstances arise and at least the system should work to help, not treat all like they are trying to scam it. Innocent until proven guilty kind of thing! If society can no longer create long term sustainable jobs than it should be willing to change all the rules to support the current day context.

  • G West

    2 years ago

    A lesson

    Wake up people.

    Either everyone counts in a society - or no one does.

    The only message that will ever impress Harper or Campbell or Ignatieff or the power brokers in this country will come from the people, en masse.

    As long as it's just a few pathetic cases, disconnected and unorganized, silent and damaged, nothing will be done.

    Posting comments to Tyee won't do it either. These slugs and parasites need to feel the hot breath of change on the backs of their cowardly necks.

    It's time to take back the commons and remind the people in Ottawa and Victoria and Toronto and every other capital in this country that they are 'servants' and not masters.

    This is OUR country – not theirs. A few fireworks on Canada Day mean less than nothing and emotionalism of last night’s beer is soon pissed away in the headache of what’s happening to 80% of this country’s people.

  • MichaelT

    2 years ago

    it is beyond perverse - this offends community morals

    I need work still waiting for my claim to go through - internet will die on the 5th and then??

    bad news I need training or I am toast.

    this

  • pmagn@yahoo.com

    2 years ago

    Canada ranked last

    Canada ranked last in G8 on climate action
    http://wwf.ca/conservation/global_warming/take_action/g8/

    The report states the lack of a clear leader among the ranked nations and while Germany has slightly improved, countries such as Canada and Russia have completely failed the test.

  • Whiskey reef

    2 years ago

    You voted for........

    these assholes..........

    Today on the radio Colin Hansen stated .....
    " It looks like we are going over our budget,even up to a couple of weeks ago the 495 million$ deficit was in reach "

    But that was then,this is now.......

    Did anyone really believe this bunch would help?

    There are a million examples,here`s one.....Campbell stopped lending money to home owners with leaky condos,you hear me,they stopped giving interest free loans to people who were stiffed with a leaky building,the last resort Campbell bunch can`t see the logic in having these repairs done,think of the economic benefit?

    And,the money for these interest free loans isn`t goverment money,there is a 700.00$ fee charged for every residential home/townhome/condo.........

    That fee was invented for the leaky condo fund,now it`s just a fee that goes into general revenue.........

    As for welfare clawing money back immediately,these social workers know they should get the money back over 4-5 months,these are orders directly from Campbell,CLAW IT ALL BACK NOW--HOW DARE ANYONE COLLECT WELFARE FROM BC--......

    Funny how Campbell want the feds to show benevolance when it comes to EI.........

    You voted for these assholes,enjoy the ride,enjoy the Conservative goverments federal and provincial squirm to force each other to pay.......

    My guess is ---The provincial deficit will be 2.5 billion dollars,and guess what,Campbell will blame the big deficit on ...............

    His benevolance and kind heart because he payed so much to help the poor.

  • VivianLea Doubt

    2 years ago

    MichaelT

    I couldn't agree more ...it offends community morals and basic human decency and the sensibility of citizens...

    Please, please tell your story to everyone you can. The political is personal and the personal is political and as long as it is just statistical ephemera it is so ignorable by those that have neither morals, nor decency, nor ordinary sensibilities.

    Best of luck to you.

  • OilbertaRedTory

    2 years ago

    If Harper were a real Conservative ...

    ... he could fix the EI system and be known as

    "the Conservative who did more for working families in five years than Liberals did in fifty"

    Oh never mind ... that was Disraeli. In 1879.

  • nechakogal

    2 years ago

    systemic flaw isn't personal

    I noticed in the story that the writer needed to emphasize, several times, that the gentleman wanted to work, I guess the assumption being, that there are many on the dole who are a bad lot who simply do not want to work?

    Capitalism has never created long-term sustainable jobs for everyone (despite pre-election stump claims by many unscrupulous politicians), in fact, unemployment is expected for a certain percentage of the population. Social programs were established in the early 20th century to provide some protection against it, just like the laws that protect your deposits at the bank. The problem has been that a less than conscientious political element (shall we say a greedy group of profiteers?) in society has recently very successfully promoted (might have to do with their very fat wallets) the idea that it is the fault of individual versus a known systemic flaw in capitalism.

    We certainly can blame the recent burst in unemployment on the current economic melt down, however, we also have the reality that fewer jobs are being created overall – as a result of technology and so on replacing the labourer. We also, of course, have had jobs transferred to cheaper, deregulated economies, nonetheless - we have always had people who needed, wanted jobs and needed the protection of the state because they were not employed. I am not sure if the greedy exploiters succeeded in convincing us that the unemployed are all bad and any programs that took care of them were a nuisance, or as many in this post have suggested, we were simply too busy with our ipods, internet blogs (not that I would chastise anyone for writing in to the Tyee) and television to notice they were dismantling them. They have, nonetheless, been reduced to a shadow of their former selves. Big surprise, they aren’t caring for anybody anymore. Just a heads up, if we don’t hit the streets soon, the current government plans to cut them back another 60 percent. In conclusion, I hope you all took a few minutes to email your MLA and let them know how much you care about social programs and rivers! For those who haven't here is a link to find your elected member of the legislature.

    http://www.leg.bc.ca/mla/3-1-1.htm

  • Jay Currie

    2 years ago

    Lags

    One of the most perverse elements of the EI system is the four to six week wait before the "insurance" kicks in.

    This is there because EI allegedly wants to verify the claim. However, there is no reason that the claim could not be paid provisionally with the proviso that if the claimant is found ineligible a claw back would occur. But that clawback should only be for the couple of weeks verification of the claim would take.

    And the clawback should not come from welfare payments.

    In theory (and the theory has been abused by the federal government for years) EI is a fully funded insurance scheme. It is not welfare. The worker has pre-paid for his or her benefits. This is quite distinct from welfare where there is no required contribution.

    Workers should be outraged at the slow pay tactics of the feds when it comes to their money. But note, none of the major parties suggest the speeding up of the claims process.

  • VivianLea Doubt

    2 years ago

    the personal, and the political

    "systemic flaw isn't personal".

    No, the flaws of any system cannot be blamed on the people who suffer the injustices of it. But to call something a systemic flaw, in my mind, negates those very personal stories of hardship. Multiply all those stories and you get "systemic flaw". As this story did, I want to see communities investigate the stories - to see what happens to real people when shitty processes and shitty rules and regulations and shitty laws cause them not to be able to pay their rent! to buy food! to get on a bus to search out work! ad infinitum.

    It simply defies belief that in this great "information age" this kind of travesty takes place...but the point is, these are our friends, our neighbours, our fellow citizens who are experiencing these indignities. The least we can do is listen to the stories - and tell our own - because this is not an abstract argument for everybody.

    Some will go to bed hungry, and others will not have a bed, and still others will wonder why their neighbours allow this to happen with no comment.

  • sunshine coast girl

    2 years ago

    Totally perverse....

    I wonder what happened to my country.

  • alive

    2 years ago

    I O U

    In California people get an IOU from their government, instead of money; that is how broke that state is.

    Are we far behind?

  • Dan the socialist

    2 years ago

    This is what the people in

    This is what the people in BC want. They elect a vast majority of Conservative MP's again, they re elected the Socreds/cons/BC Libs again for the third time.

    Now you have the nerve to complain??? You got what you voted for as did the ones that never bothered to vote.

    Iggy, Harper and Campbell do not care about you only themselves and getting and retaining power and making their business buddies rich, nothing else.

    The reason I included Iggy is he deserves as much blame as Harper (for everything not just EI) since they have propped the cons up 79 times and refuse to bring them down, not to mention how Iggy showed he was scared to stand up to Harper and came up with that bogus Blue Ribbon EI panel.

    Come next election Harper will get another minority and EI will not be dealt with.

    Iggy is finished, I hear the same comments about him as I did about Dion. We are stuck with Harper until the Libs get their act together or people wake up and elect an NDP government federally. We are stuck with BC Liberals until Ms. James steps down...BC is doomed.

  • Karen D.

    2 years ago

    Little has changed

    30 years ago I was broke, hungry and desperately looking for any kind of job. I had no money for a home or food and with every day job hunting I became weaker and less able to make a good impression on potential employers. I finally swallowed my pride and asked welfare for a food voucher (nothing more). I was turned down as they told me I was completely employable and did not qualify for assistance of any sort. Bureaucracy has changed little in 30 years.

  • morechatter

    2 years ago

    Got A Net?

    Because the Safety Net in BC is more the Crisis bottomless hole as thousands and thousands will hit the hard cold pavement. If they don't have the cash and this doesn't matter if its the Government that is doing the grabbing and making people homeless. You know the Liberal Vulture who doesn't care if your a babe or a war vet if you got cash your next if you haven't be got already.
    Oh don't worry, I doubt the Liberals will leave you out of the scheme of things, especially if you also got some cash.
    Its the Liberal's Bird of Prey philosophy as it's get them while their down, and keep them down. This way you won't have to deal with them later. Isn't it the truth.
    As voters hire a no nonsense government that has a dead, gone and never happened mission.

  • bcliberals_suck

    2 years ago

    Deep Poverty Hastended

    Why the hell is our government in such a hurry to hasten our citizens into deep poverty? Because that is surely what these kind of "perverse" "glitches" are doing. This is massive social dislocation & the creation of public disorder and it is not a coincidence. These people are Machiavellians, they construct these systems and then staff them accordingly to do the least amount they can for people.

    But truly, is this scheme not on par with loan sharking? They loan people funds, then what percentage do they take when they claw it all back from EI? I know people who've waited well over 3 months before their EI came through at all, blowing through savings, RRSP's and into credit to live (if they have it). Then to have these amounts taken in such a quick fashion, that is just pushing people over the cliff into deep poverty. It's psychopathic to do this to people and it is not in the best interests of the citizens of BC.

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