Have a question about basic income? We have the answer.
A basic income is an unconditional cash transfer from government to individuals to enable everyone to meet their basic needs, participate in society and live with dignity, regardless of work status.
It is a simple, common-sense alternative to an income security system that is full of gaps and problems, privilege for some and disadvantage for others. In our fast-paced, precarious world we all face financial risk at times. As individuals—and as a society and economy—we need better options to weather setbacks, stay well, manage transitions and create opportunity.
Our current income security system is outdated, wastefully complex and full of holes. Many people are left insecure. A basic income would allow us to solve old problems while creating new opportunities. This system would be more simple, fair, inclusive and effective for all.
Income security would also help Canadians manage setbacks and transitions, allowing everyone the opportunity to thrive in society and the economy. With a basic income system in place, people have greater resilience and security in the face of rapid pace of technological disruption, historical patterns of discrimination and complications created by pandemics and climate change.
While Canada does have some programs already in place, none of them provide the overarching support that a basic income would guarantee.
Canada provides cash transfers for seniors and families with children under 18. These national programs, which are similar to a basic income, are administered by the federal government and have been very successful. There are also tax credits and other programs across the country that provide cash directly to individuals with no stipulations, however the dollar amount is often very small.
Social assistance is another program currently in place, but it’s generally regarded as the opposite of a basic income. It’s delivered differently depending on the province or territory and, unlike basic income, comes with many conditions. The income offered is generally very low and only available after people are already in deep financial crisis. Overall, its administration is intrusive and stigmatizing.
Programs like public pensions and employment insurance serve other purposes. Here, the more you contribute usually means the more you are helped. These programs also come with conditions and are not well-suited for many of the people struggling the most. For example, a new mother who doesn’t qualify for maternity benefits.
At BICN, we use ‘basic income’ as a general term. Some people will change or add words to stress an important element. For example, ‘livable income’ puts emphasis on making sure that the amount is high enough to cover life’s basic necessities. Sometimes a name can also refer to a particular design. If you’re not sure what’s being referred to, it’s best to ask and avoid making assumptions.
In Canada, the most likely way for this to work is with a basic income ‘guarantee’ model. This sees those with the least other income getting the most help. The benefit amount gradually reduces as other wages and income grow. This model allows Canadians to get ahead as they earn. Everyone has security in case their income falls.
Another possibility is the model where everyone gets a cheque for the same amount, however this would require considerable change to our current tax system in order to administer it fairly.
We can learn from existing programs that provide guarantees for seniors and children to ensure 18-64-year-olds have similar income security. Our country has feasible options to vastly improve income security for adults. If you are interested in policy issues and design details, Basic Income: Some Policy Options for Canada is one of the best resources available.
BICN recommends an amount that directly prevents poverty. We also believe that these benefits should reduce gradually — by around 40% — as other income increases. These are good benchmarks to aim for and would help provide security and reduce inequality.
The cost will end up depending on the design, but overall, it’s not nearly as much as most people imagine — the majority of the money is already there! If we look at Canada’s current income guarantees for seniors and children, they’ve not only been affordable, but have also helped boost the economy.
Canada can help pay for a basic income by:
- Redesigning and rolling up many existing cash transfers
- Implementing tax fairness measures
- Generating a return on investment as people’s lives improve
- Collecting downstream savings as the problems created by poverty and inequality lessen
The notion that better income security will discourage paid employment is a myth. There is no evidence of this, especially when considering how challenging the current labour market is and how many barriers to employment our current system has created.
A basic income will give people options in all aspects of their work, whether they are providing care for children and elders looking to develop new knowledge and skills, start a new creative endeavor or contribute to their community.
Income security and public services are most effective when they are working together. One cannot replace the other.
Better income security improves health and reduces anxiety and opens up options. In turn, this helps alleviate demand on our public health system, for example, and improves student outcomes in our public education systems.