Clawback rules erase CPP survivor benefit as province fully exempts new disability payment
A widow in Windsor, says Ontario will claw back every dollar of her CPP survivor’s pension from her disability benefits, even as the province moves to fully exempt a new federal disability benefit from social assistance.
According to CTV News, Britt Warren’s husband, Daniel, died on August 29 at age 66 after a rapid decline from dementia.
The couple had relied on his disability pension, Canada Pension Plan (CPP) income and federal top-ups, which she said was “far more” than the roughly $2,200 she now receives from the Ontario Disability Support Program (ODSP).
CTV News reported that Warren’s ODSP payment is based on a $1,408 single person rate, plus $941 in shelter benefits and $88 in shelter assistance, bringing her to about $2,200 a month.
Before Daniel died, his income counted as household income and reduced her ODSP.
After his death, her ODSP rose to the full amount she qualifies for, but she says the total remains well below what the household lived on.
Warren expected a $610 monthly survivor’s pension under the CPP survivor benefit.
As CTV News explained, this federal payment goes to the spouse or common-law partner of a CPP contributor who has died.
Because ODSP treats that benefit as income, program rules will deduct the full $610 from her cheque, leaving her with no net gain.
“We will have to sell the house next year because I can’t afford the payments,” she told CTV News, calling it “insult to injury” that “they would take a widow’s pension away.”
In a statement quoted by CTV News, the province described ODSP as a “program of last resort,” saying CPP, CPP-Disability and survivor’s pensions are “not exempt and would be deducted dollar-for-dollar from any social assistance payments.”
Opposition and advocacy groups say this structure is the core problem.
NDP MPP Lisa Gretzky told CTV News that the current rules contribute to more people with disabilities turning to food banks and said “it is government policy that is actually keeping people in legislative poverty.”
She argued ODSP rates should at least double and be tied to inflation.
Advocates with the ODSP Action Coalition told CTV News that ODSP’s “last resort” design forces recipients to pursue other income, which the program then treats as “unearned income” and claws back in full.
Co-chair Trevor Manson said his own CPP-Disability income is fully deducted, adding, “I get all the joy of dealing with two bureaucracies for the price of one.”
In a recent pre-budget submission cited by CTV News, the coalition called ODSP’s $582 monthly shelter allowance “symbolic at best” and warned that stagnant rates increase risks of homelessness, food insecurity and even medical assistance in dying.
The group urged Ontario to double ODSP rates and treat income-replacement programs such as CPP-D, Employment Insurance, WSIB and survivor benefits like employment earnings, so recipients could keep more income without losing their entire ODSP payment.
By contrast, the province has committed to a different treatment for the new Canada Disability Benefit (CDB).
As per an Ontario.ca update from May, the government intends to exempt the CDB as income so that people on ODSP, Ontario Works and the Assistance for Children with Severe Disabilities program “would receive the benefit without seeing a reduction in their provincial social assistance payments or entitlements.”
The same update said the CDB will provide up to $200 a month ($2,400 a year) to eligible low-income, working-age Canadians with disabilities and that exempting it will allow recipients to “fully benefit” from the new program.
The Ontario.ca update also noted that this CDB exemption builds on moves to tie ODSP and ACSD rates to inflation and raise the earnings exemption for ODSP recipients, while calling on the federal government to amend the Income Tax Act so the CDB “has the broadest possible reach.”
For Warren, as reported by CTV News, those system changes do not alter the immediate impact of losing her husband’s income while seeing her survivor’s benefit fully offset by ODSP rules.
