Basic Income for All
David Simmonds

The patched-together income security programmes put in place to deal with the Covid-19 crisis have left many people wondering whether we came close to offering Canadians a guaranteed minimum income. Maybe this is the right time to examine that concept more thoroughly. The timing seems right.

A good book helps us understand.

A 202O book, by Winnipeg economist Dr Evelyn Forget, Basic Income for Canadians: from the covid-19 emergency to financial security for all makes the for case for a basic income and costs it out. This book is available at most libraries. It's worth a look.

The idea of a basic income appeals to some on the left of the spectrum, in that it offers social justice in taking from the rich and giving to the poor, thus allowing the poor to live with more dignity. The book is also of interest to some on the right, who see if as an effective replacement for costly social programmes and a means by which the well to do can keep their earnings in good conscience, knowing the less well off are provided for. Opponents of a basic income have pointed to its cost and worried that low end jobs will go unfilled as people prefer to stay home and live on their state-supplied income.

Any serious discussion of a basic income plan must be grounded in cost. In turn, the cost depends on the assumptions made as to design. Ms Forget lists the level of the income guarantee; the rate at which state-suppled income is phased down and out to account for other income; whether it should be an individual or a family benefit, how long it should continue for; how it should be paid out; whether wealth apart from income should be accounted for and how other income support programmes would be affected as critical questions.

Design attempts have been made. In 2018, the-independent-of-government Parliamentary Budget Office costed a model based on paying individual Canadians between the ages of 18 and 64 $16, 989 and couples $24,027. This assumes that income security programmes for children and seniors would stay in place. Net of all the costs saved by ending superfluous federal and provincial income support programmes, it would cost $23 billion annually. That is roughly the same amount for employment insurance, paid by federal government, annually, and less than it spends on the Canada Child Benefit.

Dr Forget presents another model developed, in 2019, by Chandra Pasma and Sheila Regehr. It’s an age 18-64 programme that would pay a benefit of $22,000 for an individual and $31,113 for a couple, declining by 40 cents for every dollar of other income earned. The gross cost of such a programme would be $134 billion annually. The authors suggest a way to pay for it by eliminating the GST credit, non-refundable tax credits as well as the Canada Workers Benefit and imposing tax increases on the income of corporations of five per cent and small businesses of three per cent. Tax increases on individuals in higher tax brackets are also included.

Other measures come into play, too.

Dr Forget also notes that other measures, such as a wealth tax or an increase in HST rates, could be used. The bottom line is that a universal basic income is “not costless, but affordable if we choose to pay for it.” If we choose is the operative phrase.

Basic Income for Canadians: from the covid-19 emergency to financial security for all, says Dr Forget “is an invitation to think hard [on] how [Canada] supports people who need help and how tax revenue is collected from others to pay for it. Basic income redistributes monies from the wealthy to the less wealthy. That is its purpose.

“Not everyone will gain financially. Everyone, however, will gain by living in a society that treats people with dignity, where all children have the ability to reach their potential and in which all Canadians can share the economic wealth of the country.” It's worth noting that money paid out as a basic income will he spent and thus thrown back into the economy.

It would be a shame if the pandemic, which has brought us to a new appreciation of those low-income Canadians doing work that is essential, were somehow to derail debate about a basic income. It would especially be a shame if the issue did not become the subject of debate during our current general election. So far, it hasn't garnered much attention.

Still, the NDP platform states that it will “In time…work to expand all income security programmes to ensure everyone in Canada has access to a guaranteed livable basic income. Making the creation of a guaranteed livable basic income a priority will strengthen our social safety net and finally ensure dignity, security and peace of mind for everyone in Canada.” The Greens haven’t published a 2021 platform, but it is on the record as having endorsed a guaranteed basic income. The Liberals call for specific enhancements to benefits seniors and steps to make housing and daycare more affordable and available. This platform stops short of a universal basic income goal. Pharmacare was promised at one point’ it doesn’t figure in the current platform. The Conservatives talk of job creation, more expenditures in mental health, extending employment insurance to gig economy workers and bringing the deficit down; it doesn’t go near a basic income.

Time for a Royal Commission.

Governments used to anticipate challenges down the road by establishing Royal Commissions or issuing White Papers. Maybe something similar is called for in this case. Thanks for writing the book, Dr Forget.