Provincial adviser proposes basic income of least $1,320

Hugh Segal, Ontario’s special adviser on basic income, wants province to test the merits of boosting incomes for the working poor and replacing social assistance with no-strings attached payments.

It has been hailed as the magic bullet to end poverty and denounced as a Trojan Horse to dismantle the social safety net.

But there has been little serious research to prove either position. Until now.

Ontario is poised to become ground zero for what may be the largest pilot project yet to test the notion of a basic income in North America.

In a discussion paper released Thursday, Ontario’s special adviser on basic income suggests topping up incomes of the working poor and replacing the province’s meagre and rule-bound social assistance program with a monthly payment of at least $1,320 for a single person, or about 75 per cent of the poverty line.

Participants with disabilities would get an additional $500 a month, according to the proposal by Hugh Segal, a former Conservative senator and a longtime advocate of basic income, also known as guaranteed annual income or minimum income.

The no-strings-attached payments for adults between the ages of 18 and 65 would be non-taxable and participants would be allowed to keep a portion of any additional income earned through employment.

“The pathologies of poverty are not limited only to those on social assistance,” Segal said in an interview. “The pathologies of poverty, illness, early hospitalization, bad educational outcomes and early drop-outs exist for everybody beneath the poverty line.”

Ontarians are being invited to give their views on Segal’s proposal online and in one of 15 public consultations between now and the end of January. The government will release a final report on the consultations and introduce a plan for the pilot by April, 2017. Funding for the pilot will be based on how the program is designed, according to government officials.

About 15 per cent of Ontarians live below the province’s Low Income Measure (LIM), which is almost $22,000 for a single person and about $44,000 for a family of four, after taxes.

A single person on Ontario Works currently lives on about 45 per cent of the LIM, or about $700 a month, while a person relying on the Ontario Disability Support Program receives about $1,130.

Although Segal does not say where in Ontario the proposed three-year experiment should take place, or how many people should participate, he says the pilot should include a “randomized control trial” in a large urban centre as well as three “saturation sites” where everyone living in poverty would be included. He suggests a city or town in both northern and southern Ontario along with a First Nations community should be tested.

Participation would be voluntary and no one would be financially worse off as a result of the pilot, Segal says in his report titled, “Finding a Better Way: A Basic Income Pilot Project for Ontario.”

The trial would measure health and education outcomes, food security, life choices, such as the decision to have children, living arrangements and parenting time, employment status, hours worked and income earned and participants’ perceptions of citizenship and inclusion.

It would also examine how a basic income impacts employment insurance, provincial and federal child benefits and other social programs.

“Testing a basic income is a humane and useful way to measure how so many of the costs of poverty (in terms of productivity, health, policing, and other community costs, to name only a few) might be diminished, while poverty itself is reduced and work is encouraged,” Segal says in the report.

Ontario spends about $9 billion a year on social assistance, excluding costs to the health care, education and legal systems produced by the effects of poverty, Segal notes.

The pilot should help Ontario determine if a basic income can build on other government initiatives, such as increases in the minimum wage, improvements to the Ontario Student Assistance Plan (OSAP) and the Ontario child benefit to cut the depth and incidence of poverty in the province, he adds.

The Wynne government signaled its intention to launch a basic income pilot in this year’s spring budget. Community and Social Services Minister Helena Jaczek appointed Segal in June to prepare a design and implementation plan.

Other countries such as Finland, the Netherlands and Kenya are developing their own pilot projects to test the idea. And a California technology company is planning a five-year project. But in a referendum last summer, Switzerland rejected a universal basic income of about $3,300 a month out of fears it would bankrupt the country and encourage idleness.

Canada explored the concept in the late 1970s when Dauphin, Manitoba tested a “mincome” for low-income residents, set at 60 per cent of the poverty line. Results showed a drop in hospital admissions and mental health problems, an increase in high school completion among young men and little impact on residents’ attachment to work.

Segal says the idea is gaining worldwide attention because globalization and technological advances are leaving large sectors of the population behind.

Although many anti-poverty activists support investigating the idea of a basic income, some view the proposed pilot project and government consultations as more delay in their quest to raise welfare rates which currently lock almost 895,000 Ontarians in deep poverty.

“This government’s track record of studying poverty, reviewing poverty, consulting on poverty and making empty promises to reduce it suggests nothing will be different this time,” said Mike Balkwill of Put Food in the Budget.

“Lack of specificity about how long the basic income pilot will run conveniently provides an additional excuse for the Liberal government to hold off on significant increases to social assistance rates in the 2017 budget, or even before the next provincial election,” he added.

However, Jennefer Laidley of the Income Security Advocacy Centre, a legal aid centre that advocates for those on social assistance said Segal’s report “opens up a critical conversation about how we ensure everyone in Ontario has enough to support themselves and their families and how government programs should treat people with dignity.

“There’s no magic bullet,” she said. “So it’s key that government is now exploring various solutions — reforming existing social assistance programs, improving the quality of work, and considering basic income.”

https://www.thestar.com/news/canada/2016/11/03/proposed-basic-income-pilot-would-provide-monthly-payments-of-least-1320.html

Ontario Seeking Input on Basic Income Pilot

Province Launching Consultations on Innovative Way to Deliver Supports

Ministry of Community and Social Services

Ontario is seeking public input to help inform the design of a basic income pilot, which is an innovative new approach to providing income security.

The pilot would test whether a basic income is a more effective way of lifting people out of poverty and improving health, housing and employment outcomes. Through the consultations, Ontario is seeking input from across the province, including from people with lived experience, municipalities, experts and academics. The province will also work with Indigenous partners to tailor a culturally appropriate engagement process that reflects the advice and unique perspective of First Nations, urban Indigenous, Métis and Inuit communities.

The province is consulting on key questions, including: who should be eligible, where the pilot should take place, what the basic income level should be and how best to evaluate it. The consultations will be guided, in part, by a discussion paper by the Hon. Hugh Segal, Finding a Better Way: A Basic Income Pilot Project for Ontario, and will run from November 2016 to January 2017. People can participate by:

Exploring innovative ways to deliver supports and services is part of our government’s plan to create jobs, grow our economy and help people in their everyday lives.

Quick Facts

  • Finland, the Netherlands and Kenya are also looking at developing pilot projects that test the idea of a basic or guaranteed annual income.
  • Y-Combinator, a California technology company has announced it will be piloting a Basic Income project that is expected to run for five years.
  • The government will prepare a final report on what we heard during the consultations, and introduce a plan for the pilot by April, 2017.
  • Organizations interested in hosting their own basic income pilot consultations can go to ontario.ca/basicincome for the consultation guide.

Additional Resources

Letter to Susan Marjetti, Senior Managing Director, Ontario Region, CBC Radio

This posting is courtesy of Put Food In The Budget


We are dismayed by the misleading promotion from the CBC Toronto that the donations to food banks from this coming Friday’s Sounds of the Season program will ‘feed the city’. If you share our concern you can click here to send a letter to Susan Marjetti, Senior Managing Director, Ontario Region, CBC Radio.

The research in our Discussion Paper – We Need to Talk. Who banks on food banks? shows that the $600,000 raised by the CBC Sounds of the Season program in 2013 provided on average a one-time contribution of 2.76 pounds of food to those visiting Daily Bread member food agencies. 

It is inaccurate for the Sounds of the Season program to suggest that these food donations will meet the needs of people who are poor – or that these donations will ‘feed the city’.

Charity is a worthy and individual act of compassion. It is completely inadequate however to address the systemic factors that cause poverty.

  • We believe that focusing on public donations of food and money to food banks in one big seasonal event gives the false impression that little more needs to be done.
  • We are concerned that Sounds of the Season creates the false the impression that poor people will receive enough food from food banks.
  • We are concerned that focusing on charitable giving during the holiday season provides ‘feel good’ relief that allows people to enjoy their holidays without feeling additional responsibility for the impoverishment experienced by a large part of the population.
  • We believe that defining ‘hunger’ as the problem, and charity as the solution, creates low expectations of how CBC listeners can act to end poverty. A charitable donation to food banks to prevent people from starving is not an adequate response to poverty. We fear that more effective public action – acting in solidarity with people who are poor – is discouraged by an event that directly and indirectly communicates that ‘charity is enough’.

We believe the voices of people who use food banks, and the voices of people who volunteer at food banks and emergency meal programs, have not been adequately represented in past broadcasts.

If you share our view than we ask that you send this letter to Susan Marjetti, Managing Director of CBC Ontario Region now. (click here)

Background: We wrote to CBC Radio Toronto on September 16 to request that the Sounds of the Season program this year increase its emphasis on the following messages:

  • Poverty is the problem, not hunger.
  • Addressing the systemic roots of poverty is the only way to ensure that people who are poor will have enough food.
  •  Food banks and emergency meal programs do not, and never will, meet the basic needs of people in our communities with low incomes.

On October 6, Susan Marjetti responded to our concerns saying (in summary) “We are confident that our continued association with food banks for CBC fundraisers across Ontario allows us the greatest potential to make a difference in both the immediate need to put food on the table for the 375,000 Ontarians who rely on food banks each month  and address the issue of poverty in our community”.

On October 15 we wrote back to say “We continue to be concerned that the Sounds of the Season program primarily emphasizes ending hunger, and fails to raise awareness about the policies, legislation and collective public advocacy that is required to end poverty.

We simply want the Sounds of the Season program to encourage a more balanced discussion of the limits of charity as a strategy to end systemic poverty in Ontario.

Steering Committee
Put Food in the Budget campaign.

{1} ONTARIO ASSOCIATION OF FOOD BANK 2013 HUNGER REPORT

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PFO Bulletin #13 – Creating Communities of Shared Opportunity across Ontario

Time for a Civic Declaration on Decent Work and Basic Incomes for All

The Social Planning Network of Ontario (SPNO) was active and instrumental in making child poverty a major issue in the 2007 election and, in partnership with the Interfaith Social Assistance Reform Coalition (ISARC), SPNO mobilized the Poverty Free Ontario (PFO) network to keep poverty eradication alive in communities across Ontario during the 2011 election. Many of PFO’s cross-community partners revived the “Let’s Vote for a Poverty Free Ontario” election sign campaign in the just concluded 2014 provincial election, which produced a majority Liberal government.

Where does SPNO/PFO go from here with the poverty eradication agenda under the new political scene?

Retrospective on Impact of SPNO’s Poverty Eradication Strategy

Seven years ago in its spring meeting on Toronto Island, SPNO set an advocacy agenda for active promotion among its member organizations’ communities across Ontario in the provincial election scheduled for October 2007. The record of the Toronto Island discussion clearly states the intent to demand that timelines and targets be established, first for the reduction of child and family poverty within five years and then a plan for its elimination in Canada’s sesquicentennial year 2017. Several major strategies in a poverty reduction and elimination plan were proposed:

  1. “sustaining employment”, so that no families in which a member worked full-year, full-time remained living in poverty; and
  2. a full child benefit ($5400 per child in poorest families) to supplement employment income in recognition of the public interest in supporting the costs of raising children.

In addition, the SPNO members reaffirmed the importance of strengthening the community support base (e.g. early learning, affordable housing, community support services) as an important component of a poverty reduction strategy.

SPNO recognized decent work and putting an end to working poverty as the cornerstone of its child and family poverty reduction agenda. The record of SPNO’s discussion in 2007 clearly addressed the false contentions of the “welfare wall” proponents. SPNO rejected the notion that people had to be kept in destitution as an incentive to leave social assistance to accept low wage work.

While the $100/month Healthy Food Supplement proposal and the Put Food in the Budget (PFIB) campaign would not be shaped for two years, the SPNO meeting in the spring of 2007 laid the groundwork for new benchmarks to end both working poverty and deep poverty, calling for a “just differential” between social assistance rates and the minimum wage. Notes of the SPNO meeting indicate that the goal by 2017 should be to get working people 20% above the poverty line and people on social assistance up to the poverty line, first by making sure no social assistance recipient lived in deep poverty (below 80% of the poverty line).

These commitments among the SPNO membership on Toronto Island in 2007 became the central messages for a cross-community awareness campaign over the summer and fall months running up to the election. Along with SPNO’s report naming Ontario the “child poverty centre of Canada”, the community meetings and media coverage contributed to Premier McGuinty’s promise to develop a child and family poverty reduction strategy within the first year of his new administration, if re-elected.

Since 2007, SPNO’s positions on sustaining employment supplemented with essential income supports to reduce and eliminate poverty have been incorporated into major campaigns focusing on raising the minimum wage (WAC’s Minimum Wage Campaign)[1] and moving social assistance rates towards adequacy (Put Food in the Budget)[2]. The Liberal Government has shown movement towards the demands of the Minimum Wage Campaign. And, persistent cross-community advocacy since 2009 has resulted in resolutions expressing support for the $100/month HFS in 25 Ontario municipalities and recommendation by the Social Assistance Review Commissioners, leading to the first real income increase in social assistance rates in the 2013 provincial budget in twenty years.[3]

Decent Work and Basic Income Strategies through the Life Cycle

In recent years, the debate about a Guaranteed Annual Income or Basic Income has re-emerged as it has periodically since the 1960s. The prospect of some kind of clear, simple universal income security program is alluring. Expressions of interest from all parts of the political spectrum suggest a potential political consensus on a guaranteed income, which is as unusual as it is attractive.

Where does SPNO’s position on poverty eradication and inequality fit in this current discourse? Does the Basic Income approach require us to abandon or re-think our public policy stance since 2007? How should SPNO position itself on this issue as the new provincial government takes office and the federal election approaches in 2015?

If “basic” income means establishing a floor of income adequacy that enables individuals and families to maintain their health and dignity by meeting the cost of daily living needs, then clearly SPNO supports such policy. Some part of the population disconnected from the labour market temporarily or permanently by their situation and personal circumstances (e.g. single parents, persons with disabilities) will require income support programs at basic, adequate levels to ensure that they do not live in poverty. Most will depend on some form of paid work to get by. Too many of these community members in part-time and precarious employment at minimum wage levels cannot meet their basic daily living needs with their earnings.

Social policy emphasizing the workforce as the route out of poverty subjects people to low wage and precarious work and promotes “workfare” for those dependent on income supports, while reliance on income support programs only inevitably sets rates well below adequacy in terms of basic living requirements. How can labour market and income support policy work together to ensure that poverty is eradicated for all in Ontario?

We already have income support models that recognize the relationship between work and income for vulnerable parts of the population. Old Age Security and the Guaranteed Income Supplement for retiring workers introduced in the 1970s to supplement private pension income and CPP benefits had a major impact on reducing seniors’ poverty to below 4%, and were indexed to protect their purchasing power against inflation. Granted, the GIS and CPP need enhancement now to maintain these gains.

It is possible to extend this supplemental income support approach to other stages of life in which people have varying attachments to the workforce. We can think of strategies for decent work and basic income across all stages of the life cycle, which recognize an appropriate and mutually reinforcing relationship between labour market participation and income support requirements as the following suggests:

  1. Children and youth (0-25) – Income support for this stage in life is important largely in the context of supporting young people in their families. A full National Child Benefit for families recognizes the need for lower income families to have help with the additional costs of raising children (Campaign 2000’s call for increasing the current maximum of $3200/child up to 18 years to $5,500 is consistent with the Basic Income approach suggestion). A Youth Income Benefit for young people 18 to 25 years would enable “debt free” learning and training opportunities and transition to work in their formative years.
  2. Early and middle adulthood (25-55) – Working age and family adults need positive work experiences in their early adult years and social engagement through employment that allows them to make important civic contributions. It should be a requirement of public policy that decent work with living wages and sound social protections (pension, health, and other social insurances) be available to all working age adults. Working age adults without decent work should have the assurance of community and civic employment at living wages through the non-profit and local public services sectors. Decent work is becoming ever less available in the low wage labour markets of the corporate sector.
  3. Later adulthood (55+) – Begin to extend eligibility for the GIS down from full retirement years to this stage of adulthood. This would protect incomes as needed for adults phasing down from active engagement in the labour market prior to full retirement. The GIS must be upgraded for those fully withdrawn from the workforce when their incomes after OAS and CPP and other pension income are inadequate. This would restore full poverty elimination for seniors, a Canadian legacy first achieved in the 1970s.
  4. Appropriate income and service frameworks must be available to support the extraordinary social circumstances for persons with disabilities and persons with chronic physical and mental health conditions.

This approach does not substitute income for employment earnings, nor does it compel workforce participation in order receive income support. It recognizes that earnings from employment are an important component of maintaining a livelihood, but that that labour market detachment at any stage of the life cycle should not condemn one to poverty. Both wage protections and income guarantees are required.

Reframing Decent Work

Since 2007 (and for many of us a decade or more before), SPNO and its cross-community partners in the PFO network have focused a lot of attention on income adequacy – increasing social assistance rates to end deep poverty; raising the minimum wage to get full-time, full-year earners above the poverty line. This concentrated attention has led to some gains and movement of the policy debates in a good direction but we may be allowing ourselves to remain confined to “minimalist” positions when it comes to framing what we think decent work should be. Notably, more communities are not just advocating for raising the minimum wage but are also for work at a “living wage”.

The availability of good and decent jobs should be seen as much of a challenge today as it was at the height of the industrial revolution in the 19th century.[4] Today, in a post-industrial society, good and decent jobs seem a faint hope. Our youth in particular struggle to establish any secure foothold in the labour market, and, even with higher levels of education, remain subject to mostly short-term and precarious employment. In the face of increasing tuition and living costs for post-secondary education, many youth accumulate high levels of debt and graduate into an economy that offers mostly poor paying service jobs. We are at risk of condemning our younger generations in particular to dismal, unfulfilling futures and chronic spells of poverty and exclusion. Productive employment in these formative early years of labour force participation is critical.

While good jobs in the traditional economy appear to be scarce, there is no lack of work needed to create a truly sustainable society. It is time to reframe the notion of good jobs in terms of work that needs to be done to build and strengthen our social and civic infrastructure. We need to re-balance our economy from one tilted heavily towards private wealth creation and concentration to one of collective stewardship of our human and financial resources offering shared opportunity for all.

Quality employment guarantees are critical for youth and younger adults as they enter the workforce supplemented with income programs as they make transitions through their working lives. Government incentives and partnerships with the private sector (retail, commercial, industrial) should be directed toward the creation and support of decent, well-paying, career development jobs. There is hope that the private sector might recognize its role in contributing to a collective purpose that adequately compensates workers while securing a fair return on investment.

Realistically, however, we should look to city governments and the community sector to show leadership, as the City of Seattle is doing by making a commitment to the highest minimum wage ($15/hour) in North America in response to a strong community advocacy movement.[5] Even recently here in Ontario, the Put Food in the Budget campaign mobilized across communities to secure resolutions in support of the $100/month Healthy Food Supplement in 25 city councils, which was cited by the Social Assistance Review Commissioners in their own recommendation in support of the HFS.

After forty years of market-driven neo-liberal social and economic policy, it is time to disengage from the tyranny of global capital and to restore social justice from the ground up with a Civic Declaration on decent work and basic incomes for all. As in Seattle, city governments and the community sector must join their voices to demand senior government support for good jobs in business and in public services. The continued importance of work by nurses, teachers, firefighters and librarians as well as in the social, environmental, recreational and arts and culture sectors must be respected. Governments should support community and civic employment strategies in the public and non-profit sectors that enable youth and younger adults to start life with a solid foundation of productive employment that builds and strengthens our social, cultural and environmental infrastructure. Civic Declarations directed to this collective purpose would both stimulate economic development and grow the next generation of an active and engaged citizenry.

We have a common stake in creating communities of shared opportunity for all. Investing in work that protects and enhances our environment, supports civic and community well-being, and grows local economies will produce social and economic benefits for all. Pursuing this path will demand the activation of a collective stewardship that engages all parts of the community in a discussion of how to work together for the common good. What work needs to be done to create and sustain the kinds of communities that we want to live in? What can business, labour, civic and community leaders do to contribute to that shared purpose? How can the role of the non-profit sector be expanded as a source of decent work and sustainable development?

Creating Communities of Shared Opportunity

We need to re-frame decent work and basic incomes in terms of solidarity, with a mission to create communities of shared opportunity for all across Ontario, while recognizing the complexity of actual human experience through different stages of the life-cycle. We have an obligation to offer other guarantees, most critically that our younger generations will have the opportunity to make their contribution to sustainable social and economic development through the application of their energies, skills and talents in the public, civic, non-profit, and corporate sectors.

We call on cities and communities to lead the way in framing Civic Declarations for decent work and basic incomes to eradicate poverty within this decade, and to create communities of shared opportunity for all across Ontario.

To this end, it is proposed that the Social Planning Network of Ontario join with its network of community leaders and organizations in Poverty Free Ontario to engage our communities in a discussion of the central tenets of a Civic Declaration, to test its resonance as a herald for structural change, and to explore its implications for both local and cross-community ground-swelling action for social justice in Ontario.

Peter Clutterbuck
Marvyn Novick

For further information contact:
Peter Clutterbuck, SPNO Senior Community Planning Consultant
(416) 653-7947   cell (416) 738-3228
pclutterbuck@spno.ca
Web site: www.povertyfreeontario.ca


[1] http://www.workersactioncentre.org/issues/minimum-wage/

[2] http://putfoodinthebudget.ca/

[3] A 4% increase to the OW Basic Needs Allowance in the 2013 provincial budget ($26/month) was the first real income increase for OW recipients since the 1995 cuts of 22%, all other 1%-2% adjustments since 2003 being for cost of living, and at that were below the annual rate of inflation in several of those years.

[4] Industrial manufacturing jobs in the 19th century were low paying and conducted in unsafe and unhealthy working conditions until unions organized for collective action among labourers and social reformers introduced public controls and regulations for improved employment

[5] http://www.theguardian.com/commentisfree/2014/jun/07/seattle-minimum-wage-fifteen-dollars-fight; http://prospect.org/article/revolt-cities

PDF version of Bulletin #13

Ontario ‘recommits’ to tackling child poverty

TORONTO – After failing to meet their own child poverty reduction strategy target — and blaming it on the Stephen Harper government and the economy — the Ontario Liberals are now pledging to eradicate homelessness.

Deputy Premier Deb Matthews acknowledged Wednesday that her government failed to meet a goal it set in 2008 to reduce child poverty in Ontario by 25% in five years.

“We knew that one level of government could not achieve that ambitious goal all by itself so we laid out a very clear plan on how to meet that target,” Matthews said. “We as a province did our part, we did everything we said we would do when we released that strategy in 2008.

“And had the other elements of the strategy — particularly the responsibilities we believe lie with the federal government — had the federal government done its part we would have come very close if not have achieved our goal of a 25% reduction in child poverty.”

In “Breaking the Cycle,” the government of Dalton McGuinty asked the federal government to double the Working Income Tax Benefit and increase the National Child Benefit Supplement to help the province meet the target.

Matthews said almost 50,000 children and their parents have been lifted out of poverty through measures undertaken by her government, such as full-day kindergarten, a minimum wage hike and increases in the Ontario Child Benefit.

The original goal had been to move 90,000 kids out of poverty.

Matthews said her government “recommits” to reducing child poverty put won’t set a date.

In addition, Matthews said the government plans to wipe out homelessness, although there was no deadline provided on that commitment either, and the minister said she would consult with experts before proceeding with a plan.

Doris Grinspun, executive director of the Registered Nurses’ Association of Ontario (RNAO), said that even if the government was not prepared to set new target dates for reducing child poverty and eliminating homelessness, it could at least dedicate 1% of its budget to related initiatives.

Tory MPP Jim McDonell said the Liberals are making promises they can’t keep.

“Today’s announcement sets no targets and that means they have no serious commitment to tackle poverty in Ontario. Vulnerable Ontarians are looking for action and a realistic plan,” McDonell said.

NDP MPP Cheri DiNovo said the government has no one to blame but itself in failing to meet child poverty reduction targets.

In Ontario, 130,000 children used a food bank over the past month, and thousands languish on waiting lists for affordable housing, she said.

DiNovo said she was homeless as a child, and she scoffed at Matthews’ comment that more research is needed before implementing a plan.

“I can tell you what homelessness looks like — it looks like you don’t have a house,” DiNovo said.

Peter Clutterbuck, of Poverty Free Ontario, said the coalition has called for significant hikes to social assistance rates which, after inflation, have only risen about 4% since 2003, the year the Liberals gained government.

Matthews’ goal of eliminating homelessness is an admirable one but what’s needed now is action and funds, Clutterbuck said.

By Antonella Artuso, Queen’s Park Bureau Chief
http://www.lfpress.com/2014/09/03/ontario-recommits-to-cutting-child-poverty