Rethinking basic income

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If there’s one thing I’ve discovered over the past couple of weeks, it’s that there are few concepts more polarizing than that of a universal basic income (UBI).

I attended a workshop at Haliburton United Church on May 10 that saw around 20 area residents discuss the merits of a UBI. Most seemed to be in favour of it, but there were the usual questions of “how can we possibly afford it?” and “what will it do to our already depleted labour market?”

The answer to both those questions is… nobody really knows. UBI has been tested in two high-profile government-funded pilot projects in the past 50 years – the first in Dauphin and Winnipeg, Manitoba in the 1970s and then in Lindsay, Thunder Bay, Hamilton, Brantford and Brant County in 2017.

Research compiled by a pair of University of Manitoba professors in the early 1990s suggested the impacts to the labour supply were minimal, though it should be noted this is based on data that’s now two generations old. The workers of yesteryear are a little different from the workers today.

The office of the parliamentary budget officer (PBO) said a basic income program like the one piloted by the Liberals six years ago would cost $81 billion if it were rolled out nationally. To qualify for that initiative, people had to make less than $34,000 per year to receive a maximum top-up of $16,989. Couples who made less than $48,000 could receive up to an additional $24,027.

The PBO estimates around 7.5 million Canadians would be eligible.

Even at a 50/50 split with the provinces and territories, that would be a more than $40 billion cost for the feds to swallow – around 10 per cent of the total projected budget spend in 2023/24, and just under half what the country has set aside for national defence. In fact, UBI would become Canada’s costliest file, just edging out Indigenous Services ($39.5 billion).

I’m not exactly impartial in this debate. My sister-in-law and her husband were two of the 4,000 people to benefit from the pilot in 2017. At the time, they were both working minimum wage jobs and spending a huge chunk of their take-home on rent and other household costs. When they started receiving the top-up, they used the money to go back to school. Fast-forward six years and they both have careers they love and recently purchased their first home.

I’m not sure that would have been possible without the pilot.

So, should our federal and provincial leaders be looking into this? I think so. The Basic Income Canada Network polled participants in the Ontario pilot, with results stating most experienced a significant decrease in stress, anxiety and other mental health issues. Some said they were able to buy food they otherwise couldn’t have afforded, while others improved their housing situation.

The high cost would be offset by savings in other areas, notably healthcare and social services. Would it be enough to justify moving ahead? I’m not sure, but it’s certainly something that should be investigated.

Maybe there’s a reason nowhere else in the world has done this. Maybe it is totally pie in the sky. But given the dire situation we find ourselves in today, with around five million Canadians living in poverty (with costs associated with that pegged at between $72 billion and $84 billion annually, incidentally) maybe it’s time to start thinking way, way outside the box.