The Canadian Emergency Relief Benefit comes to an end in a few weeks, putting many Canadians in a state of anxiety and insecurity about how they will pay for basics such as food, housing and transportation.
Rather than moving back to the Employment Insurance program fraught with problems, the Government of Canada has the opportunity to move forward towards an income support program that reaches everyone in need and lets people live their lives with dignity.
Income and wealth are known to be strongly associated with health. People with lower income suffer from mental and physical illnesses at higher rates than those with higher socioeconomic status. They are at higher risk of developing diabetes, experiencing chronic stress and even dying earlier than their wealthier counterparts. Poverty also affects a person’s ability to access education, employment, safe housing and nutritious food.
Unfortunately, current income support programs do not provide adequate funds for people to lead a healthy and dignified life. They are restrictive in their eligibility criteria, leaving many people in need without support. Current programs trap people in poverty by requiring them to deplete savings and other resources before being able to access social assistance.
The idea of a basic income, also known as minimum income or guaranteed income, has been around since the 1960s. It refers to unconditional payments from governments to individuals regardless of employment status. Some basic income models are contingent upon need while others are universal, providing a basic amount to every individual. Canada has examples of both for some populations: the Canada Child Benefit which has lifted hundreds of thousands of families out of poverty is income-tested, but old age security payments are universal for Canadian residents aged 65 or greater.
Basic income pilot projects conducted in Manitoba in the 1970s, and more recently in Ontario, have shown the benefits of this approach to poverty reduction. In Manitoba, the MINCOME project decreased the high school drop-out rate and reduced hospitalizations for accidents, injuries and mental health problems. Participants in the Ontario pilot project reported fewer visits to the emergency room, increased physical and mental well-being and less use of alcohol and tobacco.
Many argue that providing a basic income reduces incentive to work. This was not the case in the Ontario basic income project where 83% of the participants continued working and, of those who stopped, nearly half went back to school or university to upgrade their skills and increase their employability.
It may seem daunting or even impossible to use public funds to finance basic income for Canadians. But experts have crunched the numbers and shown that Canada can indeed afford a basic income program. Rolling current income support programs such as employment insurance, child benefits and senior payments into one basic income program will provide access to these existing financial resources and reduce administrative costs. In addition, shifting resources from refundable and non-refundable tax credits into basic income and modifying the current taxation system to make it fairer, will provide sufficient funds to pay for Canada’s basic income program.
Reducing income inequities benefits rich and poor alike: more equal societies have less mental illness, fewer crimes, less substance use and more trust among strangers. The current global pandemic has shown us that even those who had good jobs or healthy businesses can have our financial security threatened severely and unexpectedly. Having a robust social safety net that provides the necessities for a healthy life and is respectful of who we are is more important now than ever before. We all deserve to live with dignity and basic income can help achieve this.
Vamini Selvanandan© 2020. This work is licensed under a Creative Commons CC BY 4.0 license. This article was originally published in the Rocky Mountain Outlook on September 17, 2020. Photo credit: Suzy Hazelwood on Pexels.com
- Basic Income Canada Network. Basic Income: Some Policy Options for Canada IN BRIEF
- Canadian Coalition for Public Health in teh 21st Century. Basic Income
- New Atlas. Canada’s cancelled basic income trial produces positve results
- ResearchGate. The Town with No Poverty: The Health Effects of a Canadian Guaranteed Annual Income Field Experiment