Stop wondering about under-subscription of benefits

Getting the Learning Bond and Education Savings Grants is really hard for low-income parents

I have become mildly annoyed by those who can’t figure out why the Canada Learning Bond (CLB) and the Canada Education Savings Grants (CESG) are undersubscribed among low-income parents. There really should be no mystery.

All you have to do is shadow a low income parent (usually a woman) through the process and it all becomes clear. The following is a composite (mix and match) of my shadowing activity with four very motivated young lone parents who had heard about these benefits and wanted them for their children.

I get to their places about 8:00 a.m. and ask if they are ready for it. There is the usual last minute kerfuffle about getting a child to school and another to daycare. They ask me if I know of any way to get daycare paid for to apply for these benefits.

So that’s barrier number one. There is no paid child care to apply for a SIN for a child at Service Canada and the subsequent trip to the bank.

“When will you be back?” asks the childcare provider.

“Hopefully just after lunch” which sounds awfully uncertain to her.

I then say “OK – which Service Canada office are we going to?”

I have streamlined the process by bringing my car. I will do the driving. Otherwise it’s public transit – subway and a bus. Barrier number two: transit.

In one instance, we went to a Service Canada centre that had closed. We had to drive three kilometres to the new one. No notice was up at the old one. My iPad and a local Starbuck’s Wi-Fi saved the day. The mothers I travelled with had no data plans on their phones – just texting and the phone itself to save money. Barrier number 3: access to information.

The first thing you notice with Service Canada is that it is not a place for kids. In one instance, I became childcare provider and playmate for a busy six year old with a penchant for window shopping and princess attire in the mall. I could see how this might not work for some mothers.

One hour later, we got the process started. Everything went like clockwork until the staff member asks where the child’s father’s name is on the birth record. The poor lone parent turns crimson. I asked if this was a necessity. The answer: “No it’s just something we always ask”.

Barrier number four: stigma. That one parent was ready to end it right there.

We get the SIN. No charge!

We are late for the bank appointment and the officer has gone to lunch. We could not blame her.

In another instance, the officer was sick.

Barrier number five: Uncertainty – and uncertainty can cost another day of transit and another day of childcare.

But things are looking up. The bank has a place for children to play. Tip to Service Canada: Get with the plan.

We open the RESP and get started with the paper work. This all works well until the officer asks how much she would like to put in the account. Typically the people I shadowed have very little money. They are told of the enriched CESG but they sit and shrug. They have no money to match to get enriched CESG’s.

Then my big question – the one I always ask.

“You know, on the way to poverty, a lot of people might default on a loan, like a credit card whatever… is there consumer protection on the money my friend here is depositing?” All the women I shadowed were in some type of minor default or in a credit dispute of some type. Minor stuff but significant as it turns out

No bank staff has yet known the answer to that question. Not one ever!  And it gets better. When they say they are going to check, not one has been able to come back with a definitive answer.

Barrier six: Uncertainty (again)

Well, I will tell you the answer. The Government of Canada assures by law that its money cannot be seized through a garnishee or lien on the account. But no such protection exists for the mother’s portion. And there are bank fees that apply if a lien takes money from the account.

Barrier seven: No consumer protection.

So you ask the next obvious question: “How can I find out if there will be a lien on my account?”

The answer: “you can’t” –you have to deposit your money and find out. Or pay a lawyer significant fees to find out for you – at least in the hundreds of dollars.

Barrier eight: you can’t find out whether you have a lien on your account or whether a lien in the system will find you. If you hire a lawyer, it’s a further financial barrier.

We drive back home. Remember this is public transit if I am not there.

Now guess what happens in subsidized housing when someone’s bank account has a lien and all the money goes plus they get fined? Guess how the news spreads? Answer: like wildfire.

So are you still wondering why these savings vehicles are undersubscribed?

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