In only a matter of months, the Ontario government will roll out a basic income pilot project in three cities.
Announced by Premier Kathleen Wynne, the pilot will provide around 4,000 residents in Hamilton, Thunder Bay, and Lindsay with extra cash to supplement their lack or low amount of income. The pilot is not just targeting those who are unemployed or homeless but individuals who are underemployed or working low-paying minimum wage jobs as well. The pilot’s goal is to improve the quality of life and job prospects of those living under or near the poverty line.
While this is not the first time a pilot project of this sort has been tried in Canada, this attempt is certainly the biggest and most comprehensive so far. It’s also a really, really big deal. If implemented right, basic income has the potential to transform how welfare works not just in Ontario, but the rest of Canada.
At its simplest, basic income is the idea that those who are poor should get the money they need. No complicated plans or strategies, just the government paying an income to those who need one. That direct and easy transfer of cash gives basic income numerous benefits over other forms of welfare. Most importantly, basic income is simple and could reduce the high administrative costs associated with other welfare programs.
Basic income is also unlike other forms of welfare as it can be set up in ways that don’t remove incentives for people to work. A common criticism of any welfare program is that people can be discouraged from working as they get the money they need from the government anyway. With a basic income program however, every dollar received from other sources (such as a salary) reduces the benefits provided to the recipient by only fifty cents, instead of eliminating benefits entirely like with other welfare programs. Under basic income, people will still be able to work without risking the total loss of their benefits.
With these benefits, it’s no wonder basic income has received a wide base of support over the years. Individuals from across the political spectrum have been in favour of it. Richard Nixon tried to implement basic income in the 1970s and Milton Friedman, the famous right-wing economist, praised the idea in one of his books.
Many officials in Canada have also long favoured basic income, and Ontario’s pilot project is not the first attempt by a province to implement the policy. Between 1974 and 1979, the Manitoban and federal governments tried out a similar pilot in the small town of Dauphin, MB. While the findings are still debated, it seems Dauphin was largely a success.
By the end of the program, the rate of doctor and hospital visits in the town had declined while the amount of high school students graduating had increased. Mothers reported being able to spend more time with their children and others reported improved mental health. While the research does show a slight decline in the rate of hours worked, it was minimal and the overall success of the project suggests this cost would be worth it.
But if basic income worked in Dauphin over 40 years ago, why isn’t it Canada-wide by now? Unfortunately, this mostly can be attributed to a series of elections in the late 70s that caused both levels of governments to changeover. The governments who replaced the previous ones were ultimately uninterested in continuing the project. No final report on the pilot was ever written up and the thousands of documents on the results are now sitting in some warehouse in Manitoba. It is only very recently, with the renewed interest in basic income, that researchers have begun examining these 40-year-old findings.
With promising past results and growing public interest in basic income, Ontario’s pilot project has the potential not just to work but to spread to the rest of Canada. If Ontario’s gamble succeeds, Canadians across the country may one day enjoy the numerous benefits of basic income.