SSP aimed to increase employment and income for single parents receiving public assistance in two Canadian provinces by increasing the financial incentive to work.

SSP aimed to increase employment and income for single parents receiving public assistance in two Canadian provinces by increasing the financial incentive to work.

SSP increased the financial incentives for work by boosting income through payments tied to earnings. SSP participants working full time (at least 30 hours per week) but earning less than a benchmark level (set by location and year) could receive additional income equal to half the difference between their earnings and the benchmark. The benchmark was chosen so that most participants working full time would earn higher incomes if they left Canadian income assistance and received the supplement. The payment increased income by about $3,000 to $7,000 (Canadian) per year for most participating families but could double income for those earning the minimum wage. These payments were available for up to three years as long as a person continued to work full time and did not receive payments from Income Assistance. Participants were permanently ineligible for the earnings subsidy if they did not attain full-time work within one year of joining SSP. The program focused on single parents who had participated for at least one year in the Income Assistance program. SSP operated in British Columbia and New Brunswick, Canada. Additional research evaluated the SSP Plus program, which provided financial incentives and additional employment services, comparing it with both SSP and a comparison group of people who received neither program.

Year evaluation began: 1992
Populations and employment barriers: Parents, Single parents
Intervention services: Financial incentives
Setting(s): Tested in multiple settings

Effectiveness Rating and Effect By Outcome Domain

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Outcome domain Term Effectiveness rating Effect in 2018 dollars and percentages Effect in standard deviations Sample size
Increase earnings Short-term Supported favorable $3,974 per year 0.19 4961
Long-term Supported favorable $1,673 per year 0.08 4961
Very long-term Supported favorable $2,928 per year 0.14 2371
Increase employment Short-term Supported favorable 9% (in percentage points) 0.22 4961
Long-term Supported favorable 4% (in percentage points) 0.10 7813
Very long-term No evidence to assess support
Decrease benefit receipt Short-term Supported favorable $-578 per year -0.21 8277
Long-term Supported favorable $-468 per year -0.17 4961
Very long-term Little evidence to assess support
Increase education and training All measurement periods No evidence to assess support

Sample Characteristics

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State or region: Canada

Implementation Details

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Dates covered by study

SSP delivered services to participants from November 1992 to March 1998. It operated over slightly different periods in its two locations, with the service period between November 1992 to October 1997 in New Brunswick and November 1994 to March 1998 in British Columbia. Most impacts were measured at 18, 36, and 54 months after random assignment and information on participants’ use of cash assistance programs, called income assistance and managed by provinces in Canada, was measured for 70 months after random assignment.

Organizations implementing intervention

The Social Research and Demonstration Corporation (SRDC) is a Canadian nonprofit research organization that develops, tests, and evaluates social programs. SRDC managed SSP after it was developed by federal government officials in Canada’s Department of Employment and Immigration.

Populations served

The participants that received the supplement were 96 percent female and 55 percent had a child younger than 6. Eighty-five percent of participants were younger than 40-years-old.

Description of services implemented

SSP aimed to encourage self-sufficiency through a financial incentive: a monthly cash payment to supplement employment earnings for a three-year period. Statistics Canada informed participants of selection and obtained consent to participate in the project from 90 percent of selected individuals. Next, individuals were randomized into a program group that was offered the earnings supplement or a comparison group that was not offered the earnings supplement.

Individuals in the program group could receive an earnings supplement if they worked full time (at least 30 hours a week) and also left Canadian income assistance within one year of being offered the incentive. Supplement recipients who remained eligible for Canadian income assistance while working who chose to return to Canadian income assistance or who stopped working would lose the supplement. Ninety-six percent of the program group received an orientation (in a group setting or one-on-one with program staff) about supplement benefits.

The amount of the earnings supplement was half of the difference between the participant’s earnings from full-time work and a benchmark level ($30,000 per year in New Brunswick and $37,000 per year in British Columbia in 1994, the first year of the intervention). The benchmark level was set yearly by each province so that most participants working full time would earn higher incomes if they left Canadian income assistance and received the supplement. Recipients provided in-person employment verification to initiate payments and received monthly payments by mailing monthly pay stubs to program offices. The supplement increased participants’ incomes by $3,000 to $7,000 per year after taxes compared with if they worked the same number of hours and did not receive the earnings supplement, and could double pre-tax income for those earning the minimum wage. The calculation of the earnings supplement did not consider income not from employment, such as child support. Participants were invited to a budgeting and personal finance workshop toward the end of the three-year supplement period.

Service intensity

Participants remained eligible to receive supplemental income payments for up to 3 years if they maintained full-time employment and did not receive Canadian income assistance. About one-third of eligible individuals (36 percent) received the supplement for an average length of 22 months. On average, participants received a supplement of almost $18,300 over the 3-year period.

Program group members that received supplements differed from program group members that did not receive a supplement. For example, supplement receivers were more likely to have a high school diploma or GED (58 percent versus 41 percent), had more work experience (9 years versus 7 years), and were more likely to be working full time at random assignment (14 percent versus 3 percent). The main reason program group members did not receive a supplement was because they were not able to find a job.

Comparison conditions

The study used a randomized controlled trial design. Individuals in the comparison group were Canadian income assistance clients who were not eligible to receive any SSP earnings supplements.

Partnerships

SRDC contracted with two private organizations to deliver the program by contacting participants, leading orientations, initiating supplement payments, and handling payment issues. Bernard C. Vinge and Associates Ltd., an organization that provides health and community services, operated two offices in British Columbia, and Family Services Saint John Inc., a social services organization, operated two offices in New Brunswick.

SRDC contracted with SHL Systemhouse Inc., a private Canadian information technology services provider, to develop and maintain the supplemental payment system.

Statistics Canada, a Canadian government agency that produces statistics about Canada, identified eligible participants monthly from Canadian income assistance administrative records.

Federal and provincial agencies (British Columbia’s Ministry of Social Services, Human Resources Development in New Brunswick, and local Canada Employment Centers) provided technical assistance and access to Canadian income assistance data.

Staffing

Each province (New Brunswick and British Columbia) had a provincial coordinator who managed the project in the province in addition to other office management responsibilities. The additional office in each province had its own office manager. Each of the four program office locations had up to three project associates and up to two administrative assistants. Project associates conducted group and one-on-one information sessions, communicated with participants, and worked with participants to initiate supplement payments. Administrative assistants scheduled participants for orientation sessions and administrative office tasks.

Most of the staff were women with university degrees and experience working with disadvantaged populations. SRDC held a two-day staff training session at each office and provided ongoing technical assistance to the offices.

Local context

SRDC implemented the intervention in two Canadian provinces, British Columbia and New Brunswick. This area encompassed a range of settings such as small cities, suburbs, and rural areas. The context in which the intervention operated was affected by federal policy changes during the study period. Canada’s welfare payment system was replaced with a block fund in 1996, resulting in lower federal contributions to provinces to pay for welfare payments. Provinces responded by reducing welfare benefit levels, tightening eligibility requirements, and imposing work requirements on welfare recipients.

Fidelity measures

SSP was federally funded by Human Resources Development Canada, a social services department of the Canadian government during the period the intervention operated.

Funding source

A cost-benefit analysis revealed that the cost per participant was about $2,700 more than the cost of providing Canadian income assistance over the five-year period between an individual’s random assignment and the last follow-up survey. Most of this cost was attributed to the supplement payments. Participants’ income increased by almost $5,300 on average compared with the comparison group receiving Canadian income assistance only. The net benefit to society per participant—that is, the extent to which the benefits to the participants exceeded the cost to the government—was about $2,600.

Studies of this Intervention

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Study Quality Rating Study Counts per Rating
High High 2