Next Steps on Welfare Reform

Donna Pavetti testified today before the House Ways and Means Committee, Subcommittee on Human Resources, on renewing the Temporary Assistance for Needy Families (TANF) program.  Here’s the opening of her testimony:

TANF was created 15 years ago with a balanced approach in mind — that our nation’s cash assistance system would be redesigned to create an expectation of work for able-bodied recipients and that a safety net would be maintained for parents who were unable to work due to a short-term crisis, a work-limiting disability or because no jobs are available.  When we consider the reauthorization of TANF, we need to consider both aspects of TANF, taking into account what we have learned during TANF’s first 15 years.

In my testimony, I will focus on four key points related to these two aspects of TANF:

1. TANF provides cash assistance for a very small share of poor families, and many who receive assistance face significant barriers to employment.
2. State TANF programs are built on an expectation of work, but there is a mismatch between recipients’ employment assistance needs and the narrowly-defined work activities that the statute recognizes.
3. The TANF work participation rate is an inadequate measure of TANF’s success or failure as a program that promotes and supports work and provides a safety net when work is not available.
4. The safety net aspect of TANF is weak; TANF responded only modestly to increased need during the recent economic downturn, and then, only in some states.

First, however, I would like to highlight an immediate issue that merits policymakers’ attention even before reauthorization.  Congress should restore and renew full funding for 2012 for TANF Supplemental Grants, which were provided to 17 states every year since 1996, until now.  Despite its name, this funding was meant to address serious inequities across states in the basic TANF funding formula, rather than as a “supplement.”  Recipient states have among the highest rates of overall poverty and child poverty, and on average, their TANF expenditures per poor child have been less than half those of non-recipient states.

States are now scaling back programs that help unemployed TANF recipients find jobs, and TANF has responded only modestly to the recession, largely due to its fixed block-grant funding structure that provides states the same funds regardless of increases in need as a result of an economic downturn.  The unprecedented loss of TANF Supplemental Grant funds for the 17 states this past June 30, will, among other things, make it harder for them to maintain or increase work engagement among recipients.

Click here for the full testimony.