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• HBHC Evaluation

Human Resources Development Canada

Provision of a disability benefit under the Canada Pension Plan had been subject to scrutiny due to recent reductions in numbers of older workers and concurrent increases in the number of claims for disability benefits. Economists have studied the implications, in cases where disability is not so severe as to preclude working, of the availability of disability pensions on the supply of labour and have modelled the choice between working and withdrawal from the labour force to receive disability benefits. This study addresses this discretionary component of CPP disability claims and the hypothesis that people who are capable of working are able to qualify for disability benefits, which thus function as an economic grant to such people.

The study was part of a broader evaluation of Canada Pension Plan Disability Benefits. It examined data from the department's longitudinal labour force data base, from administrative sources, and from a survey of CPP disability beneficiaries that Statistics Canada conducted in 1995. These sources provided data at the level of the individual beneficiary. The study exploited the longitudinal nature of the data by comparing annual data from 1981 to 1993. It assessed the behaviour of several indicators over time and whether they support or detract from the hypothesis that CPP disability benefits function as an economic grant. The analysis included tabular and graphical presentation of trends over time as well as a comparison of successive annual regression models of the likelihood of starting to receive CPP disability benefits. It also examined changes in the nature of disabilities, in terms of specific injuries, illnesses, or diseases.