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Ontario Is The Latest Place To Test A Basic-Income Guarantee

The concept of paying everyone so nobody is poor is catching on.

Illustrations: Tanor via Shutterstock

In the last few months, the basic-income guarantee has stopped being a mere idea and become something governments are prepared to test in the real world. Finland announced a big pilot. Four Dutch cities followed suit. And now two provinces in Canada are discussing their own trials. The concept of paying everyone so nobody is poor is catching on.

Ontario's 2016 budget provides few practical details, but discusses the need for "consistent and predictable" support for working people in "today’s dynamic labor market." It notes that basic income is gaining attention in Canada and abroad, and that most new jobs these days are "precarious." In Canada, temporary and part-time employment grew twice as fast as full-time work between 1997 and 2015.

The pilot will test "whether a basic income would provide a more efficient way of delivering income support, strengthen the attachment to the labor force, and achieve savings in other areas, such as health care and housing supports," the budget document says.

Meanwhile, the government in Quebec recently appointed François Blais, a long-time advocate for basic income, as minister of employment and social solidarity, leading to speculation that a policy proposal could be imminent there. Quebec prime minister Philippe Couillard says a basic income could simplify the welfare system and encourage work among benefit claimants.

The case for a basic income rests on two main pillars. One, work doesn't pay the way it used to: The increase in non-standard employment leads to increasing insecurity among workers, which needs to be compensated for somehow. Second, the current public assistance system is too complicated, expensive to manage, and overly coercive. A basic income would free people to spend their money, rather than being forced to accept benefits as in-kind services (e.g. in the form of health care subsidies).

"The changing economy means that, especially for young people, getting into that permanent labor market is becoming more of a challenge," says Ian Culbert, director of the Canadian Public Health Association, a nonprofit that has lobbied for a basic income in recent elections. "The rise of low-paying, lower-skilled jobs is a challenge. We have our social safety net in place in Canada, but some people don't qualify. A basic-income guarantee gives everyone that leg up to make a better life for themselves."

Canada's Liberal Party, now in power in Ottawa, mentioned a basic income in its election manifesto (albeit in the most confusing way possible). Jean-Yves Duclos, the federal minister for families, children, and social development has apparently studied basic income options in the past. Ontario and Quebec would probably have to cooperate with the federal government if it goes ahead with basic-income pilots.

"If you take all the income support programs across the provinces, lumped them together and reduced administration costs, you'd probably have enough money to pay for the program," Culbert says (though exact payment amounts haven't been discussed as yet).

Canada has history with basic income. In the 1970s, the city of Dauphin, in Manitoba, conducted a five-year trial into "mincome"—a variant on a basic income. About one third of residents received monthly checks. (For families of two, the annual amount in 2014 dollars was about $20,400). Though the city never published a report into the experiment's impact, subsequent research shows the payments had a positive effect. Among recipients, hospitalization rates fell and high school completion rates rose.

That experiment was a long time ago, though. The new pilots should give us a better idea if a basic income could work today.

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