Government figures reveal large shifts in welfare spending

Cash assistance drops

funds for other aid rise

October 13, 2003|By NEW YORK TIMES NEWS SERVICE

WASHINGTON - New government figures show a profound change in welfare spending, money shifted from cash assistance into child care, education, training and other services intended to help poor people get jobs and stay off welfare.

Cash assistance payments now account for less than half of all spending under the nation's main welfare program, Temporary Assistance for Needy Families, federal officials say.

The proportion has been declining steadily since 1996, when Congress revamped welfare and abolished the guarantee of cash assistance for the nation's poorest children. The 1996 law required most adults to work within two years of receiving aid, and it gave states sweeping authority to run their welfare and work programs with lump sums of federal money.

Statistics tabulated by the Department of Health and Human Services, at the request of The New York Times, show that the proportion of federal and state welfare money spent on cash assistance declined to 44 percent last year, from 77 percent in 1997. The proportion allocated to various types of noncash assistance shot up to 56 percent from 23 percent in 1997.

"The program has been fundamentally transformed," said Wade F. Horn, assistant secretary of health and human services in charge of welfare policy.

The federal and state money is used not only to provide a minimal income to single mothers, but also to help them move from welfare to work, hold onto low-wage jobs and move into better-paying jobs.

The money is being used to pay for transportation from home to work, to treat drug abuse and mental health problems and to provide temporary shelter for women who have suffered domestic violence. The money is also used for one-time payments - for example, for car repairs - to alleviate immediate financial needs, so people never go on the welfare rolls.

Temporary Assistance for Needy Families is financed jointly by the federal government and the states. Of the $25.4 billion spent last year, about $11.2 billion was for cash assistance and $14.2 billion was for noncash benefits.

The official federal tally of welfare recipients counts only people who are receiving monthly cash assistance.

Since the welfare law was signed in 1996, the number of people on welfare has plunged from 12.2 million to 5 million, a 59 percent decline. The federal government provides a fixed amount to the states, $16.5 billion a year, regardless of how many people are on the rolls.

Rep. Benjamin L. Cardin of Maryland, the senior Democrat on the Ways and Means subcommittee responsible for welfare policy, said: "The welfare caseload is changing more than it is shrinking. There are certainly fewer people receiving cash assistance, but there are also more people receiving child care, employment services, vocational training and other assistance designed to promote work."

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