Indicators of Welfare Dependence: Annual Report to Congress, 2002. Chapter I: Introduction and Overview

03/01/2002

The Welfare Indicators Act of 1994 (Pub. L. 103-432) directed the Secretary of Health and Human Services (HHS) to publish an annual report on welfare dependency. This 2002 report, the fifth annual indicators report, gives updated data on the measures of welfare recipiency, dependency, and predictors of welfare dependence developed for previous reports. It reflects changes that have taken place since enactment of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) in August 1996.

The purpose of this report is to address questions concerning the extent to which American families depend on income from welfare programs. Under the Welfare Indicators Act, HHS was directed to address the rate of welfare dependency, the degree and duration of welfare recipiency and dependence, and predictors of welfare dependence. The Act further specified that analyses of means-tested assistance should include benefits under the Aid to Families with Dependent Children (AFDC) program, now the Temporary Assistance for Needy Families (TANF) program; the Food Stamp Program; and the Supplemental Security Income (SSI) program.

The first annual report was produced under the oversight of a bipartisan Advisory Board on Welfare Indicators, which assisted the Secretary in defining welfare dependence, developing indicators of welfare dependence, and choosing appropriate data. Under the terms of the original authorizing legislation, the Advisory Board was terminated in October 1997, prior to the submission of the first annual report. Subsequent annual reports have provided updates for the measures developed for the first report. In recent years, the report has been shortened, in keeping with Congressional interest in a smaller set of indicators and predictors of dependency.

This 2002 report provides updated measures through 1999 for several dependency measures. It has become possible to update these measures annually because of a change made last year in the data source for several indicators, from the Survey of Income and Program Participation (SIPP) to the Current Population Survey (CPS). Whereas the SIPP data have only been analyzed through 1995, the CPS data are available for more recent years, allowing examination of indicators and predictors of dependency since the enactment of welfare reform in 1996. Those measures that can be updated annually are presented at the front of each chapter, followed by the figures that are derived from data sources that are updated less frequently.

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