Price of Pain
2004-02-26 00:30:37 UTC
B.C. spent $5 million to cut 46 off welfare
VICTORIA, Canada - The B.C. government spent $5 million and put disabled people
under needless stress to cut just 46 people off government assistance, B.C.'s
auditor general said Tuesday.
In a report tabled in the B.C. legislature, Wayne Strelioff said the ministry
of human resources pressed on with its review of disability recipients in 2002
without any proof that a great number of them were ineligible.
"The type of review process was not well thought-out," Strelioff said in an
interview. "The process was what we call a fast-track one that likely cost more
than it should, and unnecessarily increased anxiety within a particularly
vulnerable group of people."
In the end, the government found only 400 people -- less than one per cent of
the ministry's more than 62,000 disabled clients -- were ineligible for
assistance.
Of those, 40 reapplied and were granted disability status, and 314 began
receiving other forms of government assistance.
Only 46 people had their cases closed entirely, the report said.
"The ministry did not achieve the significant cost savings it thought it would
by doing the review, as almost all benefit recipients were found to meet the
new eligibility requirements," the report said.
Human Resources Minister Stan Hagen defended the government Tuesday by saying
the review was never designed to cut costs.
"It wasn't about saving money," he said. "It was never about saving money.
"What we wanted to do was make sure that the money that we spend, which is
public money, is being directed to the people who need it most."
But NDP MLA Jenny Kwan, who grilled Hagen during question period, said the
minister's "spin" lacked credibility.
"The fact is, the government was blinded by their ideology, they were blinded
by one factor, and that was to find cost savings to offset the tax cut that
didn't pay for itself," she said. "So they were going after poor people on
disability."
The auditor says the government fast-tracked its review under the assumption
"that a large number of recipients would fail to qualify, therefore losing
their disability status, and the result would be significant cost-savings to
government and taxpayers."
The report says the government at various times estimated cutting anywhere from
6,100 to 9,700 people off disability rolls.
The government, however, never checked its assumption, "which, as the final
outcome shows, was unfounded," the report says.
Strelioff acknowledges that after the eligibility rules changed in late 2002,
the government had an obligation to confirm that everyone receiving benefits
was eligible. But he said a simple statistical sample would have quickly shown
that very few people would be found ineligible.
* * *
Stubborn B.C. Liberals blunder into a new mess
Vaughn Palmer
Wednesday, February 25, 2004
VICTORIA - For students of government incompetence, the auditor-general this
week provided a case history of how the B.C. Liberals set out to save tens of
millions of dollars and instead ended up wasting $5 million.
The story begins in the late 1990s, when the then New Democratic Party
government softened eligibility for disability payments under income
assistance.
The change was followed by a one-third increase in the number of people
collecting disability, boosting the costs by about $100 million.
Pretty soon, according to auditor-general Wayne Strelioff, treasury board, the
branch of the ministry of finance which oversees spending, was expressing
concerns about "the rapid increase in program costs."
The ministry of human resources was likewise "particularly troubled by growth
rates in client numbers."
Its research showed "that indiscriminately granting disability status to
clients who really should not qualify increases their dependence on
assistance."
Those concerns did not prompt any revisions of the program by the New Democrats
before they left office. But the seeds of doubt were planted within the
bureaucracy and blossomed under the B.C. Liberals.
They came into office seeking ways to cut spending and launched a
cross-ministry review of all programs. Within human resources, not
surprisingly, one of the options that arose was to revisit the eligibility for
disability payments.
The result was new legislation, setting out revised eligibility requirements,
coupled with a review of all current clients, to ensure they would still
qualify.
"The ministry believed," so says the auditor-general, that "a high number of
these individuals would be ineligible under the new rules."
Internal estimates of the pending reduction ranged between 6,177 and 9,740.
Based on disability rates of $608 to $783 per month, that meant savings of
between $50 million and $100 million.
Hence the ministry's decision to fast-track the review. "If the ministry's
assumptions were correct, it would realize those savings quickly," says
Strelioff. "The savings from cancelling eligibility were expected to help the
ministry meet its budget targets."
But the B.C. Liberals undertook all of this with none of the planning or
analysis that they promised to bring to government.
The auditor-general found no cost-benefit analysis, no serious effort to check
the reliability of the assumptions. The numbers were "very rough," -- no more
than guesses and bad ones at that.
The result was a combination of farce and tragedy.
Far from cutting thousands off disability, the review led to a reduction of
just 46 individuals from the welfare rolls.
Far from saving tens of millions of dollars, it cost almost $5 million to
complete the exercise.
Or $100,000 per person who was cut off. Or enough to fund more than 500 people
on disability for an entire year.
If that were not harrowing enough to contemplate, there was the impact of all
this on the folks who depend on disability payments for their livelihood.
"The review increased the anxiety among disabled clients," the auditor-general
says several times, although he leaves it to the reader to imagine the details.
Plus, all of it was avoidable. Before proceeding with a full-scale review, the
ministry could have first tested its assumptions by a scientific sample of the
disability rolls.
"Such a sample would have shown that the risk of payments to ineligible clients
was low, and that the ministry would therefore have taken a more gradual
approach to reviewing recipients outside the sample," says the auditor-general.
"With this simple step, the whole review process could have been less costly
and probably less onerous for both the ministry and the recipients."
But the Liberals, stubborn to the end, weren't having any of it.
The official response to the auditor-general's report from the ministry of
human resources ranged from grudging acknowledgement -- "while cost savings
were estimated as part of the ministry's budget planning" -- to bald-faced
denial -- "they were not a key consideration."
As for the distress to the disabled, the Liberals tried to shift the blame
elsewhere: "Unfortunately, certain stakeholder groups opposed the review and
dropped out of the process. The ministry believes the subsequent actions of
some of these groups contributed to higher client anxiety."
Those groups didn't conceive of this botched exercise, nor should they wear the
results.
The Liberals deserve all the blame, both for the waste of tax dollars and for
adding to the suffering of some of our most unfortunate citizens.
***@direct.ca
VICTORIA, Canada - The B.C. government spent $5 million and put disabled people
under needless stress to cut just 46 people off government assistance, B.C.'s
auditor general said Tuesday.
In a report tabled in the B.C. legislature, Wayne Strelioff said the ministry
of human resources pressed on with its review of disability recipients in 2002
without any proof that a great number of them were ineligible.
"The type of review process was not well thought-out," Strelioff said in an
interview. "The process was what we call a fast-track one that likely cost more
than it should, and unnecessarily increased anxiety within a particularly
vulnerable group of people."
In the end, the government found only 400 people -- less than one per cent of
the ministry's more than 62,000 disabled clients -- were ineligible for
assistance.
Of those, 40 reapplied and were granted disability status, and 314 began
receiving other forms of government assistance.
Only 46 people had their cases closed entirely, the report said.
"The ministry did not achieve the significant cost savings it thought it would
by doing the review, as almost all benefit recipients were found to meet the
new eligibility requirements," the report said.
Human Resources Minister Stan Hagen defended the government Tuesday by saying
the review was never designed to cut costs.
"It wasn't about saving money," he said. "It was never about saving money.
"What we wanted to do was make sure that the money that we spend, which is
public money, is being directed to the people who need it most."
But NDP MLA Jenny Kwan, who grilled Hagen during question period, said the
minister's "spin" lacked credibility.
"The fact is, the government was blinded by their ideology, they were blinded
by one factor, and that was to find cost savings to offset the tax cut that
didn't pay for itself," she said. "So they were going after poor people on
disability."
The auditor says the government fast-tracked its review under the assumption
"that a large number of recipients would fail to qualify, therefore losing
their disability status, and the result would be significant cost-savings to
government and taxpayers."
The report says the government at various times estimated cutting anywhere from
6,100 to 9,700 people off disability rolls.
The government, however, never checked its assumption, "which, as the final
outcome shows, was unfounded," the report says.
Strelioff acknowledges that after the eligibility rules changed in late 2002,
the government had an obligation to confirm that everyone receiving benefits
was eligible. But he said a simple statistical sample would have quickly shown
that very few people would be found ineligible.
* * *
Stubborn B.C. Liberals blunder into a new mess
Vaughn Palmer
Wednesday, February 25, 2004
VICTORIA - For students of government incompetence, the auditor-general this
week provided a case history of how the B.C. Liberals set out to save tens of
millions of dollars and instead ended up wasting $5 million.
The story begins in the late 1990s, when the then New Democratic Party
government softened eligibility for disability payments under income
assistance.
The change was followed by a one-third increase in the number of people
collecting disability, boosting the costs by about $100 million.
Pretty soon, according to auditor-general Wayne Strelioff, treasury board, the
branch of the ministry of finance which oversees spending, was expressing
concerns about "the rapid increase in program costs."
The ministry of human resources was likewise "particularly troubled by growth
rates in client numbers."
Its research showed "that indiscriminately granting disability status to
clients who really should not qualify increases their dependence on
assistance."
Those concerns did not prompt any revisions of the program by the New Democrats
before they left office. But the seeds of doubt were planted within the
bureaucracy and blossomed under the B.C. Liberals.
They came into office seeking ways to cut spending and launched a
cross-ministry review of all programs. Within human resources, not
surprisingly, one of the options that arose was to revisit the eligibility for
disability payments.
The result was new legislation, setting out revised eligibility requirements,
coupled with a review of all current clients, to ensure they would still
qualify.
"The ministry believed," so says the auditor-general, that "a high number of
these individuals would be ineligible under the new rules."
Internal estimates of the pending reduction ranged between 6,177 and 9,740.
Based on disability rates of $608 to $783 per month, that meant savings of
between $50 million and $100 million.
Hence the ministry's decision to fast-track the review. "If the ministry's
assumptions were correct, it would realize those savings quickly," says
Strelioff. "The savings from cancelling eligibility were expected to help the
ministry meet its budget targets."
But the B.C. Liberals undertook all of this with none of the planning or
analysis that they promised to bring to government.
The auditor-general found no cost-benefit analysis, no serious effort to check
the reliability of the assumptions. The numbers were "very rough," -- no more
than guesses and bad ones at that.
The result was a combination of farce and tragedy.
Far from cutting thousands off disability, the review led to a reduction of
just 46 individuals from the welfare rolls.
Far from saving tens of millions of dollars, it cost almost $5 million to
complete the exercise.
Or $100,000 per person who was cut off. Or enough to fund more than 500 people
on disability for an entire year.
If that were not harrowing enough to contemplate, there was the impact of all
this on the folks who depend on disability payments for their livelihood.
"The review increased the anxiety among disabled clients," the auditor-general
says several times, although he leaves it to the reader to imagine the details.
Plus, all of it was avoidable. Before proceeding with a full-scale review, the
ministry could have first tested its assumptions by a scientific sample of the
disability rolls.
"Such a sample would have shown that the risk of payments to ineligible clients
was low, and that the ministry would therefore have taken a more gradual
approach to reviewing recipients outside the sample," says the auditor-general.
"With this simple step, the whole review process could have been less costly
and probably less onerous for both the ministry and the recipients."
But the Liberals, stubborn to the end, weren't having any of it.
The official response to the auditor-general's report from the ministry of
human resources ranged from grudging acknowledgement -- "while cost savings
were estimated as part of the ministry's budget planning" -- to bald-faced
denial -- "they were not a key consideration."
As for the distress to the disabled, the Liberals tried to shift the blame
elsewhere: "Unfortunately, certain stakeholder groups opposed the review and
dropped out of the process. The ministry believes the subsequent actions of
some of these groups contributed to higher client anxiety."
Those groups didn't conceive of this botched exercise, nor should they wear the
results.
The Liberals deserve all the blame, both for the waste of tax dollars and for
adding to the suffering of some of our most unfortunate citizens.
***@direct.ca