The Rise and Fall of Canada Welfare State

The Rise and Fall of Canada Welfare State

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The Rise and Fall of Canada Welfare State

Introduction

A welfare state is the one in which the government of the day is a crucial player in the provision of social aid to its citizens. Such states employ the principle of equality in providing and allocating the available resources with the priority given to those at the lower class (Crook, 2012). Under the past regimes, this practice was quite common, unlike today where only few countries are still involved in providing direct social assistance to its subjects. The Canadian state was one of the countries that had embodied welfare as a core component of their governance. Canada took a unique approach, different from that of the United States, focusing only on caring for its citizens (Crook, 2012). The general policy implied that the healthier individuals were supposed to mind the ailing while those with surplus had to share their income with the less fortunate. At the time of its inception, the Canada’s welfare state was consuming billions of dollars in order to mitigate an array of social and economic problems. However, the past four decades have seen successive Canadian regimes in both levels of federal and provincial governments taking steps that seemed to curb expenditure on social programs (Crook, 2012). This paper will make a thorough analysis of the welfare system in Canada with a focus on the inception of the system, the reasons behind its initial success, and the circumstances that lead to the reduction if not a complete withdrawal of social assistance in the country. The focus on the successive phases and events that culminated in the establishment of the Canada welfare state will form the basis of this paper.

Historical Background

It is important to begin with a historical background of the issue to better understand the concept of the welfare system in Canada. Historical records estimate that the Canadian welfare state emerged in the early 20th-century (Crook, 2012). The introduction was initially met with mixed reactions from the citizens. On the one hand, some were opposing it; on the other hand, others saw it as an opportunity for prosperity and development.  However, after World War II, the government of the day reached a consensus with the opposing groups, and all parties agreed unanimously to adopt a welfare system in Canada. Several issues that were happening across the globe then, most being social problems, might have prompted the Canadian government to consider adopting the plan of building a welfare state. The majority of the problems emanated from the effects of World War I as well as the Great Depression, which required an immediate government response. The Canadian government attempted to reinstate the gold standard following its removal from the market on military grounds with no success, which resulted in a drastic devaluation of the Canadian currency to almost nothing. Even deflation and the crumbling of the stock exchange in 1929 could not salvage the situation (Crook, 2012).  When the war came to an end, Canada was awakened to the reality of a significant loss of lives while numerous survivors were unable to work. The few that were capable of working could not even secure a job anywhere due to the fact that the Canadian economy was going into recession. Therefore, the introduction of the welfare system was seen by many as the best opportunity to solve the situation. As a result, the idea of the welfare system in Canada gathered momentum with many citizens who were quite optimistic. Though the introduction of the idea gained the necessary support, some groups were not yet entirely convinced. Nevertheless, the Canadian welfare state was formed, which has undergone several distinct phases until the current state (Phillips, 2012).  

First Phase

The first Canada welfare state can be traced back to as early as 1840 when the state was more restricted in responding to cases of poverty and diseases due to the regulatory nature of the capitalist form of the government (Crook, 2012). Social welfare at this time was only limited to caring for the mentally ill as well as the physically challenged. Surprisingly, the state did not care about children at all. This state of affairs continued even after the Confederation, leaving only philanthropic upper-class citizens to take the initiative of caring for children by themselves. Fortunately, between 1880 and 1893 a broad debate led by J.J Kelso concerned with the welfare of the children brought forth fruitful results that saw the establishment of Toronto Children’s Aid Society and passing of the law that offered comprehensive child welfare. Kelso and like-minded individuals centered on the family as the basis of the reforms, knowing very well that a family is a source of economic security (Crook, 2012). As a result, successive laws were directed towards strengthening the marriage institution through restricting divorce, protecting matrimonial wealth, and minimizing the use of contraceptives. The government then introduced the policy of compulsory education and put more regulations on the health sector. However, some historians have argued that the government only did that in fear of social strikes. Nonetheless, the provincial governments followed suit by funding charitable organizations. For instance, in 1874, the Ontario Provincial government passed the Charity Aid Act aimed at regulating the charitable organizations (Phillips, 2012).

Second Phase

The second phase of the Canada welfare state is estimated to have occurred between the 1890s and 1940s (Crook, 2012). During these times, the Canadian government, though still practically governed by the principles of capitalism, saw the need of supplying appropriately skilled workers to ensure the stability of families and incorporating the immigrants into the Canadian labor force market. The Canadian government achieved this goal by making sure that it struck a balance between the family and the general economy. In addition, the government retrieved more land from the Aboriginal people by signing treaties with them. This time also saw the merging of organizations and charity laborers, consequently generating ideological discrepancies with each groups aiming at controlling the social welfare. This phase coincided with World War I where the state was forced to intervene in taking care of the children left behind by the parents who went to war (Crook, 2012). In 1907, the state hit another milestone by passing an industrial relation piece of legislation that allowed the government to be involved in matters concerning capital and labor. Seven years later the Workmen’s Compensation Act came into effect, forcing workers to make compulsory remittance to the insurance scheme. However, the events of World War I were perhaps the reasons that highlighted the need of having an interventionist state (Phillips, 2012). The injured soldiers and the vulnerable families forced the state to form the Dominion retirement fund scheme and the pass a law that provided mothers with allowances.