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Basic Income: An Idea That Can Pay Off

By Mary Lou Mills

Social Determinants of Health Nurse

Haliburton, Kawartha, Pine Ridge District Health Unit

Income is a key factor that affects our health and well-being.

Low income – or poverty – can lead to many problems. When people do not have enough income to pay for basic necessities such as food, housing and other goods and services, they are more likely to have health problems and die younger than people with higher incomes. In this area, we see how poverty takes a human and social toll that hurts the community and leads to higher health care costs.

The old ways of reducing poverty do not work, and new approach is needed to fix the problem. Thankfully, the Ontario government has taken a major step forward with the announcement of a Basic Income Guarantee pilot project starting later this year in Hamilton/Brantford, Thunder Bay and Lindsay. It’s especially exciting to see the three-year Basic Income pilot being tried out right in our own backyard!

Under the Basic Income pilot, eligible individuals and families – regardless of their work status – would receive a minimum annual income. Basic Income would apply to individuals between the ages of 18 and 64 years, whether they collect social assistance, disability benefits or work in a low-wage job. Under the Ontario plan, single adults will receive up to $16,989 annually and couples will receive up to $24,027 each year. People on disability will receive up to an additional $6,000 per year. Recipients who are employed will keep what they make from their jobs, with their Basic Income payments decreasing by half of the amount that they make while working.

The Basic Income isn’t extravagant; the proposed amount is only equivalent to 75 per cent of what is considered Ontario’s low-income threshold (or poverty line). However, Basic Income can make a real difference in helping people pay their bills and improve their education and job prospects.

Canada already has a form of Basic Income. When seniors collect Old Age Security at age 65, low-income seniors who qualify for the Guaranteed Income Supplement (GIS) have their income topped up to ensure they have a minimum level of income. The GIS has been vital in reducing poverty rates among seniors in Canada.

Nevertheless, some people are concerned that the Basic Income Guarantee will encourage people to be ‘lazy and not look for work.’ This is far from true. Several Basic Income projects around the world have produced positive results. One that is often cited is the Basic Income pilot project in Manitoba in the 1970s. Research from the Manitoba pilot found teenagers and new mothers were the only groups to work less. In those cases, more teens completed high school, while new mothers extended their maternity leaves. The Basic Income pilot in Manitoba also resulted in lower hospitalizations rates and fewer mental illness visits with health care providers.

Another criticism of the Basic Income pilot is that it delays finding the real solutions to poverty. Some people argue the Basic Income gives a ‘pass’ to workplaces in not having to provide a living wage, job security and benefits to their employees.

On its own, Basic Income is not a fix for poverty. More affordable housing and child care, improved labour laws and minimum wages, and more accessible, affordable post-secondary education are also part of the solution. However, ‘guaranteeing’ people a certain level of income gives them options to improve their skills and continue their education, allowing for better opportunities for employment that is secure and pays a living wage.

Ontario’s Basic Income pilot is exciting and worth pursuing. If history is any indicator, Basic Income can pay many dividends in the fight against poverty!