Wednesday, July 09, 2014

Great Idea...BUT....

I am a firm believer in the law of unintended consequences.

Today I am wondering how that law will play out yet again.

In the mail today was our GST Credit statement.  As I might have expected had I thought about it.  But what caught my attention was a notice on it that all Government of Canada Cheques are being phased out by April 2016.

Not a problem for most people.  Indeed I haven't gotten a cheque from the government for almost 15 years.   All our tax refunds and credits come via Direct Deposit.

But will that work for everyone?

To get Direct Deposit you, obviously, need a bank account.  Generally to get a bank account you at least need a home address, some accounts may even require a minimum balance.  There are people who live without a bank account.  What happens to them when the government assumes everyone can do Direct Deposit?

As it happens there are many people who miss out on government payments to which they are entitled because they fall through the cracks.  They may not file a return because they have no income.  They may be so mobile that they forget to inform the office of a change in address (which will even cancel Direct Deposit payments--as we learned one year when someone at CRA mis-entered our Postal Code and then insisted we had moved without telling them and THAT was why they had the wrong address and mail was returned to them).  To require that one has a bank account to get money to which they are entitled is merely one more hurdle that will cut money away from some of the people who most need it.

I get it.  It is cheaper to not print and mail cheques.  It is more convenient for many of us to just have the money appear (which is why we do Direct Deposit).  But a cardinal (IMO) rule in public policy is to not create structure that harm the most at risk in the society.  Unless there is some other plan in place--this change will harm some of those who live on the least.

The law of unintended consequences at work....

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