NCPA - National Center for Policy Analysis

Time Limits Are Vital Welfare Reform Tool

November 21, 2000

Two years before Congress launched welfare reform in 1996, Pensacola, Florida initiated the nation's first program to set and enforce rules that limited the amount of time welfare recipients could collect benefits. Now a new study from Manpower Demonstration Research Corporation reports that the limits spurred people to find jobs and get off the dole.

The Pensacola plan, called the Family Transition Program (FTP), was launched in 1994. It limited welfare benefits to two years out of a five-year period -- or three years out of a six-year period for families deemed hard to employ.

For the sake of the study, about 1,400 parents were assigned to the FTP program, with another 1,400 assigned to the old, unlimited-benefits program known as Aid to Families with Dependent Children (AFDC).

After following each group for four years, researchers found that:

  • More than three-fourths of FTP parents left welfare before they used all their welfare months.
  • Only 6 percent of FTP families stayed on welfare for three out of four years -- compared to 17 percent of AFDC families who had extended welfare stays.
  • FTP parents averaged $1,500 more in earnings than AFDC parents after five years.
  • However, by the end of the fourth year, families from both groups were likely to be working and had similar average incomes.

The study determined that time limits did not cause widespread or severe hardships for families.

The 1996 federal law set a five-year time limit for cash welfare payments to families. However, 42 states and the District of Columbia have set their own time limits -- with 17 states setting limits of less than a year.

Source: Cheryl Wetzstein, "Time Limits on Welfare Prove Successful," Washington Times, November 21, 2000.


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