Indicators of Welfare Dependence: Annual Report to Congress, 2005 . Chapter I. Introduction and Overview


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 2005 report, the eighth 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.

This 2005 report provides updated measures through 2002 for dependency measures based on the Current Population Survey (CPS), Annual Social and Economic Supplement, with one preliminary estimate for 2003. Although more recent administrative data provide some information on recipiency through 2004, the survey data needed to examine overall welfare recipiency are not available past 2002 for the CPS-based measures and are even less current for measures based on the Panel Study of Income Dynamics (PSID). However, measures based on the Survey of Income and Program Participation (SIPP) are now available through 2003. These newly available SIPP data allow for examination of the lengths of time people spend in poverty or receive government assistance. As in the 2004 report, measures 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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