60% of Albertans support a Basic Income; it is being seen as a real solution in COVID recovery.
Who would a basic income help?
Disabilities and Crisis Events: For those struck with disabilities that limit income-earning potential and those facing crisis events, a basic income ensures basic needs are provided for.
Business Owners: Security in meeting basic needs will allow small business owners to enact innovative approaches and increase risk-taking to retrofit or start businesses amid
changing realities while also retaining employees in changing configurations.
Governments: Administrative cost-savings and a more secure population increases tax bases and ensures long-term viability, as cost-savings from poverty costs are realized. Basic income can also provide economic stimulus.
Women: Independence in income security allows for greater safety in domestic violence situations and increases outcomes for childcare and health.
Children: Preventing poverty in early years translates to increased long-term impacts to health, community and economic contributions. When parents aren’t worried about putting
food on the table, they have more quality time for family.
Precarious Workers and Waning Industries: Shifting economies necessitate resilience to retrain, establish new means of income generation and increased job security for emerging opportunities.
Seniors and those approaching retirement: Existing programs have increased wellbeing for seniors, a basic income has the potential to further this effect with less administrative need.
Will it encourage people not to work?
● A basic income does not contain perverse incentives, as earnings reduce benefits on a sliding scale with increased earnings. Alternatively, basic income can be provided
universally and taxed back from higher income earners. The latter may provide increased stimulus to the economy, especially where buying Canadian is credited.
● Evidence from the universal basic income pilot conducted in Finland over two years (2017-2018) demonstrated that participants in the pilot (the pilot had 2000 participants aged between 25-58) worked more on average than unemployed individuals in the control group (total 173,000 individuals).
● One study conducted in the context of Alaska Permanent Fund Divided, which is a permanent, unconditional and universal cash transfer, showed an “increased employment effect” due to the broader impact of the cash transfer on consumption patterns.
● Other studies, examining the impact of negative income tax (NIT) experiments in developed countries, have observed little negative employment effect
● The MinCome experiment in Manitoba led to an initial and temporary reduction in a
significant number of people working. However, further examination revealed the unconditional cash transfer assisted people in finding suitable work matching their
skills, increase their educational attainment, and allowed individuals to take a break to undertake caregiving responsibilities.
● Experts on motivation argue that individual actions, including paid work, is a key source of gratification and individual competence. This is unlikely to be affected by receiving a basic income payment
What about the cost?
● The pilot program implemented in Ontario, if implemented across Canada, would cost
a forecasted $79.5 billion. Currently, the Canadian Government spends $32 billion on poverty programs that could be eliminated if a Basic Income were introduced.
● Poverty in Alberta is estimated to cost between $7.1 and $9.5 billion annually. While
services will still be required for those in need, a UBI that reduces the incidence of poverty will lower these costs and could replace other income support measures over
Edmonton skyline photo credit: Brandon Erlinger-Ford