MLA to table bill to close gaps in AISH coverage

Discretionary trusts would be added to resources exempt from AISH rules

An upcoming private member’s bill aims to close a gap in legislation that risks denying people with disabilities full benefits when their families set aside funds for them.

“It just means between my two kids I’m better able to plan and allocate assets so they’re both taken care of to a … fair level,” said Jeremiah Renner, financial adviser at Two Pillars Financial Solutions Inc. in Edmonton.

Renner’s 12-year-old daughter has autism and will be eligible to receive assistance from Assured Income for the Severely Handicapped (AISH) when she turns 18.

Under current rules, individuals with assets totalling more than $100,000 are not eligible for AISH, although there are a slew of exempt assets such as a principal residence and a vehicle adapted for the applicant’s disability.

But discretionary trusts — set up by parents and loved ones — are not exempt and could prevent AISH recipients from collecting their full benefits.

“This (bill) would allow an exemption where that inheritance could be in a trust and that would not count against the incoming asset test for an AISH recipient,” said Calgary-Currie NDP MLA Brian Malkinson on Tuesday. There would be no cap on the trust amount.

He plans to table the AISH (Discretionary Trust) Amendment Act, 2017 in the next two weeks. If approved, the rules would come into effect immediately.

“We are the only province that doesn’t do this,” Malkinson said.

AISH benefits expire at age 65. People with disabilities are living longer thanks to medical advancements, so families need to plan for long-term financial support, said Erin Waite, chairwoman of the Community Rehabilitation Service Provider Council of Calgary.

“If anything, your needs increase, you might need more supports.”

Renner said that Alberta previously allowed the creation of discretionary trusts — known as Henson trusts after a 1989 Ontario court case — but they were prohibited in the late 1990s.

“It was abused and revoked … It was seen as bypassing tax,” Renner said. “If (the bill is) crafted properly and put through, it will be a really good tool to … sustain quality of care for people with disabilities.”

Without the change, Renner is concerned that if his daughter inherits non-exempt assets worth more than $100,000, she would lose out on access to programs.

“When you get kicked off of AISH, you lose your place in group homes,” he said Thursday.

Currently, AISH officials have discretion on whether to include inheritances in asset calculations.

“There’s no certainty there for families ... It’s problematic for many families who are trying to plan their estates for their disabled son or daughter,” Malkinson said.

He said he spoke to more than 200 people who are concerned about the restrictions, prompting him to draft the legislation.

“I am optimistic we’ll receive support,” he said. “Every province has a similar sort of exemption for their respective program.

“When things are paid out of the trust to the AISH recipient, that would still have to follow the regular rules of AISH,” he added. “That’s what would prevent it from being abused.”