"In a nutshell, the increase in our population, combined with a decline in our economy, is putting pressure on our social assistance caseload and the associated costs," said Janet Menard, Peel's executive director of human services. "The economic indicators at this time  are signaling trouble. We are seeing an increase in our unemployment rate and that is the primary indicator of changes to the Ontario Works caseload."

Peel pays for social assistance via property taxes and, if necessary, through a reserve fund kept in case a turn in economic fortunes translates into more people needing financial assistance.

Menard explained that at its peak in 2003, the reserve had about $34 million.

However, since that time the balance of the reserve has declined and anticipated to settle at about $13 million by the end of 2008.

Most of the money drawn from the fund ($12 million) has been used to stabilize the tax rate since 2004.

About $11 million has been put to the purchase of two shelters in 2008, the Peel Family Shelter and the New Mavis site.

Another $2 million was used to pay for a new childcare centre.

But the economic tide has changed, due in large part by manufacturing job losses, and Peel's average OW monthly caseload is expected to reach 10,200 in 2009, up from the current 9,800.

Peel has lost roughly 3,000 manufacturing jobs so far and for every increase of 100 caseloads staff explained the cost to the region increases about $200,000 annually, staff explained.

At that rate, the $13 million balance expected to be in reserves at the end of 2008 will be just enough to cover eight to nine months of cost.

Menard has advised that a solid plan is needed to cushion the blow or face turning to the taxpayer in order to cover expenditures.

"We have managed our caseload well. But pressures continue," Menard said. "The economic indicators suggest that the situation is going to get much worse before it is going to improve. We can't rely on our reserves to offset the costs and that will result in an impact on our tax base."

Queen's Park has already struck a deal to upload some social assistance initiatives, namely those relating to the Ontario Disability Support Program (ODSP).

Regional officials had banked on saving money from having social programs uploaded- savings that could be transferred to cover OW costs.

But the uploading of ODSP, which gives eligible people living with disabilities financial help, will be done in phases and wont be completed until 2011.

In the meantime, the caseload for ODSP is also expected to increase to 11,759 in 2009, which will also take a bite out of whatever cash is anticipated to come back to the region.

The ODSP monthly average budget reduction estimated for 2009 is now $1.4 million, not the $2.2 million initially projected at the time Queen's Park made the announcement to upload some services. The situation sounded off alarm bells with some councillors.

"This is critical and we are going to have a heck of a hit in the next six to nine months if this continues," said Mississauga councillor Mia Prentice. "We really have to look at this."

Menard has recommended council push a meeting with Premier Dalton McGuinty in order to plead the region's case.

Also, Menard advised council to "be cautious" when considering budget expenditures next year.