With the provincial government finally relaxing the rules around asset limits for welfare recipients, it’s a good time to take a look at the restrictions on the amounts people can keep from court awards.
As Law Times reported online last week, some personal injury lawyers are calling for reforms to rules that allow those receiving Ontario Works benefits to keep just $25,000 of their cash entitlements from a successful lawsuit. Similar restrictions under the Ontario Disability Support program impose a limit of $100,000. If people want to continue to receive benefits should they receive an award higher than the cap, they must return the excess to provincial coffers.
The welfare limit has been in place and remained the same since 1990 while the ODSP cap dates back to 1998.
It’s easy to see the logic in having a cap. From the perspective of many members of the public, why should they continue to support people who suddenly find themselves with rich cash awards that likely exceed the amount most taxpayers will ever have in their own bank accounts? If someone has that much money in the bank, they can live comfortably off that for some time, according to that logic.
But on the flipside, successful litigants are people who have had a wrong committed against them. Whether the wrong was due to a medical error or a car accident, why should they lose the right to fair compensation simply because they receive public support, particularly when they may have ongoing medical needs? From that perspective, the limits to some extent are just one more way of keeping people poor.
It’s difficult to reconcile the two perspectives but it’s clear a reasonable way to respond to the issue is to index the caps to inflation. For years, the government has ignored inflationary pressures when it comes to welfare payments and asset limits but has finally started to act at least when it comes to the latter issue. It has provided some small boosts to monthly payments while allowing recipients to keep more of their earnings from working and, as of September, will increase the Ontario Works asset limit to $2,500 from $606 for a single person. Given the changes on those fronts, it’s only reasonable for the government to do the same, according to the inflation rate, when it comes to the caps on lawsuit awards.
For more, see "'Another kick' to wronged plaintiffs."
— Glenn Kauth