An organization of Canadians calling on the government to institute a guaranteed basic income rejected what one senator called “myths and stereotypes” about such a program during a Senate committee session held Oct. 17 in Ottawa.
The Senate is studying bill S-233. If passed, that legislation will require the Minister of Finance to develop a national framework for the implementation of a guaranteed living basic income, GLBI, program across Canada.
The legislation is sponsored by Senator Kim Pate. In the House of Commons, New Democratic Party MP Leah Gazan introduced an identical bill. Neither bill would actually implement a basic income program. “There is a stigma about the poor and about helping people: that we will give them a handout but we will not help them out of poverty”, Pate said.
Questions about its effectiveness
Members of the Senate standing committee on national finance had questions about the effectiveness of a basic income program, particularly its impact on the Canadian economy and government spending.
According to a 2021 analysis by the Parliamentary Budget Office (PBO), the total cost of a guaranteed basic income program would increase from $85 billion in 2021-2022 to $93 billion in 2025- 2026.
To calculate these numbers, the PBO studied Ontario’s basic income pilot project, which ran from April 2017 to July 2018, when Premier Doug Ford’s government abolished it.
Under the pilot program, participants between the ages of 18 and 64 received between $16,989 and $24,027 per year, with an additional $6,000 per year for people with disabilities.For every dollar that a beneficiary would receive in labor income, they would lose 50 cents from the basic income program.
Parliamentary budget officer Yves Giroux told senators that Canada may need to consider reducing social assistance at the provincial level, or tax credits such as the goods and services tax credit, in order to fund such a program at the national level.
The importance of the program’s universality
Proponents of the Guaranteed Living Basic Income program noted the importance of the program’s universality, arguing that more targeted approaches to delivering that income may not reach everyone who needs financial assistance.
The more targeted programs that are introduced, the more gaps are created in the system, said Evelyn Forget, a professor of economics and community health sciences at the University of Manitoba. The more gaps there are, the more opportunities there are for people to fall into them.Senators also questioned whether establishing a basic income would discourage Canadians from working.
Kathleen Wynne
In 2013, Kathleen Wynne became the first woman in Ontario history to serve as premier of the province. Under her government, the province’s basic income pilot project was carried out, which was abolished by the conservatives.
According to the Parliamentary Budget Office’s analysis, the guaranteed living basic income would have very little impact on the Canadian labor supply. The researchers found that total hours worked would only fall 1.3 percent nationally.
Former Ontario Liberal Premier Kathleen Wynne, who oversaw the province’s basic income pilot project, told senators she had multiple conversations with recipients who were more motivated and more able to enter the job market. .
Unfortunately, Wynne added, there is no official statistical evidence to support her claims because the program was abolished by Doug Ford’s Conservative government before its scheduled end.
Despite the program’s abolition, some evidence appears to corroborate Wynne’s claims. According to a survey called the Southern Ontario Basic Income Experience, researchers found that almost 80 per cent of respondents were somewhat or much more motivated to find a higher-paying job. At the same time, 37.5 percent of respondents who worked before and during the pilot program found better-paying Jobs.
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