Ontario Premier Kathleen Wynne speaks at the Ford Essex Engine Plant in Windsor, Ont. on Thursday, March 30, 2017. Ontario Premier Kathleen Wynne says she's "pleased" the state of New York has dropped proposed Buy American provisions from its state budget. THE CANADIAN PRESS/Dave Chidley
Three Ontario towns have been identified as testing grounds for the province’s new basic income pilot project. Residents of Thunder Bay, Lindsay and Hamilton will be the first in the province to receive basic income as part of the Liberal government’s experiment to figure out if guaranteed minimum income will help in reducing inequality in Canada’s largest province.Anyone in these three towns will be able to apply to the pilot project, but only 4000 people will be selected.Basic income is essentially a form of social security whereby the recipient receives a guaranteed sum of money from the government on a monthly basis, in addition to income earned on their own. The three year program will begin in late spring of 2017 and will compensate participants in this manner:Approximately 4.9 million people in Canada live below the poverty line. Three million of those are children. The price of poverty, is ironically extravagant — it costs Canadians between $72 billion and $84 billion annually. Ontario, in fact, spends approximately $9 billion on Ontario Works and ODSP each year, and that doesn’t even include the extra costs in our healthcare, education and legal systems as a result of poverty.All this, mind you, takes place in a country that has one of the highest GDPs in the world, From sheerly a budgetary point of view, we do potentially have the financial resources to reduce poverty. It’s just a matter of whether or not politicians want to make poverty reduction a priority — most don’t want to risk alienating their middle-class voter base.Proponents of basic income argue that there’s in fact, no better time to implement the system. Precarious employment and housing costs have both dramatically risen in the last five years or so, significantly widening the rich-poor gap. Approximately 800,000 Canadians are seasonally employed — when they are not bringing in an income, they rely on employment insurance.“It is prudent to ask whether the EI system should be serving this function, and whether there might be a more promising solution like basic income to address cyclical and structural unemployment in Canada,” said Karen Foster, an Assistant Professor at Dalhousie University whose research focuses on rural, seasonal employment.A discussion paper by basic income proponent and former senator Hugh Segal, challenges the core premise of Canada’s welfare state, calling it a set of “judgement-based” eligibility programs that discourages individuals, penalizes work and savings and imposes a degrading burden on individuals receiving social assistance.“Basic income can enhance the capacity of individuals to make their own choices about their own lives, as opposed to being subject to a system of automatic transfers that erodes human dignity,” wrote Segal in the report.Critics however, argue that handing an individual $17,000 a year, disincentivizes able-bodied people from seeking employment. This camp of basic income naysayers say that a one-stop solution for poverty in the form of government dough encourages dependency and discourages people from improving their situation.And then there’s the money factor. Ontario says it will invest $50 million per year for each year of the three year pilot project, and that’s just for 4000 participants. A recent Fraser Institute report slammed the basic income idea altogether, arguing that Ontario simply does not have the money to afford it.“Given Ontario’s current state of finances, the government would need to be clear on how exactly it can afford a guaranteed income as high as $22,000 for families, and what kind of social welfare programs will be cut in order for this to be financially viable.”Robert Reich, former Labour Secretary in the Clinton administration and long-time basic income advocate controversially proposed that a basic income be financed out of company profits that result job automation and technological patents.“Say, for example, 20 percent of all such profits were split equally among all citizens, starting the month they turn eighteen. The sum would be enough to ensure everyone a minimally decent standard of living, including money to buy the technologies that would free them up from the necessity of working.”Follow Vanmala on Twitter
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- Up to $16,989 per year for a single person, less 50 percent of any earned income
- Up to $24,027 per year for a couple, less 50 percent of any earned income
- Up to an additional $6000 per year for a person with a disability
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