What is basic income? Does basic income work? Can we afford it? Your questions, answered

What is basic income?

Universal Basic Income is a concept first put forward by writer Thomas More in his 1516 novel, “Utopia.” It is meant to provide unconditional annual income, paid by the government.

Does Canada have basic income?

Ontario introduced a three-year basic income pilot project in 2017, but it was scrapped by Doug Ford’s Progressive Conservatives when they swept to power in June 2018.

The federal Guaranteed Income Supplement for seniors is a form of basic income. It effectively doubles Old Age Security payments for seniors below the poverty line.

And while the Canada Emergency Response Benefit, introduced earlier this year in response to massive unemployment during the COVID-19 shutdowns, isn’t a purely universal basic income, it has UBI’s intended effect of maintaining a decent income and personal dignity in millions of households after a drastic loss of income, Star business columnist David Olive wrote earlier this year.

How much would basic income cost?

The Parliamentary Budget Office in 2018 estimated it would cost Ottawa just $43 billion in new funding to provide a national, guaranteed minimum income, similar to the one Ontario tested in 2017. And it would support about 7.5 million working-age Canadians.

How is it different from welfare?

Under Ontario’s basic income pilot, single people received annual payments of up to $17,000 — about twice as much as someone on welfare. Couples got up to $24,000 and those with disabilities received a $6,000 top-up. People who worked saw their basic income reduced by 50 cents for every dollar earned until their income reached $34,000 for singles and about $48,000 for couples.

The pilot project included 4,000 low-income people. It was intended to give people struggling on poverty-level welfare payments and low-wage jobs a basic income with no strings attached.

What are the benefits?

University of Manitoba economist Evelyn Forget’s research on Manitoba’s minimum basic income experiment in the late 1970s has been a major force behind renewed interest in the concept. One of her promising findings from the rural town of Dauphin, where most low-income families received the benefit, was a drop in hospital admissions and an increase in high-school graduations.

Because Ontario’s pilot project ended two years earlier than planned, the province — and researchers watching around the world — were not able to determine if sending unconditional cash payments to low-income residents improved their health, education, housing and employment prospects.

But informal surveys of those who participated showed promise. A majority who had low-wage jobs before the trial remained in the workforce. Many went back to school, and mental health improved dramatically.

And despite critics’ fears that free cash would drive people to quit work, a McMaster University study found three-quarters of people who were employed before joining the basic income pilot project continued to work while receiving the no-strings-attached monthly stipend. And more than one-third of those low-wage workers were able to move to higher paying and more secure jobs, the Star’s Laurie Monsebraaten reported.

What is the future of basic income?

Former Tory senator Hugh Segal helped design Ontario’s basic income pilot project. He told the Star’s Laurie Monsebraaten the global pandemic highlights the vulnerability of precarious workers and people with disabilities struggling to survive on social assistance. Polling shows close to 70 per cent of Canadians support basic income, Segal noted.

Ottawa’s CERB program, which gives $2,000 a month to out-of-work Canadians, is seen as “a signal that our leaders recognize the value of a basic income as an economic recovery measure,” Toronto businessman Floyd Marinescu, founder of UBI Works Canada, said this year. “This emergency basic income will open the door for our government to learn about the benefits of a UBI as an economic stimulus that will benefit all Canadians — and act to make it reality.”

Last week, a coalition of nearly 4,000 people and organizations called on the federal government to implement a guaranteed basic income to address the systemic gender inequities exposed and intensified by the COVID-19 pandemic.

Earlier this month, federal Labour Minister Filomena Tassi said the government is considering a guaranteed basic income. “Everything is on the table for us as we move forward,” she said. And recently, Liberal MPs made implementing a guaranteed basic income their top policy resolution for consideration at the party’s national convention in November.