The “new” Law Commission of Ontario has released its first full report, just over a year after we began operations. Our report on Fees for Cashing Government Cheques is a response to the reality that a disproportionate number of low income individuals cash their government cheques at cheque cashing businesses. This issue is consistent with the government “poverty initiative” and the recommendations are complementary to the pay day loan legislation enacted by the Ontario Legislature. The LCO’s recommendations acknowledge that some people prefer cash chequing business to banks; thus their focus in on ensuring informed choice and options that address the needs of diverse communities.
For example, many northern Ontario communities lack mainstream financial institutions. Thus the LCO recommended that the government pilot a debit program that would provide an alternative method of receiving government payments. Another recommendation is directed at improving financial literacy, both for the recipients of government payments and those who advise them. More generally, this Report reflects many of the principles that the LCO intends to apply to its work: it considered and addressed the needs of diverse communities, rejecting a “one size fits all” solution; it recognized that there will always, or at least for some considerable time to come, be individuals who prefer to use cheque cashing businesses rather than banks, even though it means that they will pay a fee; the recommendations are directed not only to government, but also to semi-public and private sector actors; and the Report is informed by consultation with a wide variety of individuals, groups and organizations with an interest in the issue of paying fees to cash government cheques.
The LCO’s Report on Fees for Cashing Government Cheques is available on the LCO’s website at http://www.lco-cdo.org.