The Ford government is changing its definition about who qualifies for disability assistance while also allowing people to earn more money while receiving social assistance.

The updates to Ontario's social assistance system were revealed by Lisa MacLeod, minister of Children, Community and Social Services, on Thursday.

The tweaks to social assistance will allow welfare recipients who find work to keep more of their earnings before their payments are clawed back.

Each month, recipients of the Ontario Works social assistance fund will be allowed to earn up to $300, up from the current exemption of $200, MacLeod said.

The previous Liberal regime had promised to raise the monthly threshold to $400, with a 50 per cent exemption on any additional earnings.

The earnings exemption for people on the Ontario Disability Support Program (ODSP) will be $6,000 annually, up from the current rate of $200 per month.

During the announcement, MacLeod said the current social assistance system puts users in a "cycle of dependency," making it difficult for people to find jobs and exit the system.

The government currently spends around $10 billion annually on social assistance, she said, adding that only one per cent of people on social assistance re-enter the workforce in any given month.

Thursday's announcement comes just months after the government moved to cancel the basic income pilot project, which provided payments to 4,000 low-income earners in cities such as Hamilton, Brantford, Thunder Bay and Lindsay.

The Tories also said they were cutting a planned three per cent increase in social assistance to 1.5 per cent.

'Redesigning' ODSP

The PCs say they will redesign and simplify the ODSP by aligning its definition of disability with the federal government's, a move critics are already saying will make it harder for some people to qualify.

Ottawa does not have a single definition for what constitutes a disability, but opposition legislators say the threshold to qualify for disability benefits under the Canada Pension Plan is higher than it is for the ODSP.

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MacLeod refused to say if fewer people will qualify for ODSP, but added that anyone who currently qualifies will be grandfathered into the system.

"They may end up on Ontario Works," she said of any Ontarians who may no longer qualify for disability assistance.

Eligibility for the program will also now be reviewed annually instead of monthly.

'The early signs do not look good'

Diane Dyson, an anti-poverty activist who recently ran for Toronto city council, told CBC News that she's already fielding calls from low-income people who are worried about how the changes will affect them.

"The early signs do not look good," she said.

Dyson said she's worried the changes announced today, combined with the government's previous actions, mean those in poverty will fall even further behind.

However, conservative strategist Jamie Ellerton said the PC government's plan — which includes cutting income tax for those earning less than $30,000 per year, a break announced during last week's fall economic statement — will help people become more independent.

Considering how many Ontarians are still using social assistance, it's clear, he said "the status quo is not working."