Basic Income cash transfers are a well-evidenced high-impact strategy for widespread poverty reduction in Canada.
COVID-19 brought Basic Income back into the spotlight in 2020 as the pandemic revealed how many Canadians were only one paycheck away from poverty, and how, across levels of governments and sectors, our systems are woefully under-prepared to withstand widespread shocks.
The Parliamentary Budget Officer of Canada recently released a report confirming that a national Basic Income program for Canada would cut poverty dramatically. Their findings, based on the Ontario pilot experience, indicate that a national program would reduce poverty by 50%. Other recent in-depth studies by the Basic Income Canada Network (BICN) and the Canadian Centre for Economic Analysis (CANCEA) estimate the reduction in poverty could be as dramatic as 95% to 100% depending on the chosen model.
In one scenario proposed by BCIN, an income-tested model with a benefit set at $22,000 ($31,113 for couples divided equally), with a 40% reduction rate (avoiding a cliff effect), and including benefits for seniors while leaving child benefits and social services as-is, would drop poverty rates to 1.2-2.0% for two-parent working-age families, working age couples, and senior couples. Senior poverty rates for singles would be reduced to 5.6%. Absolute poverty would be reduced by 95.6%, and relative low-income would be reduced by 75.2%
Basic income is more than an income security intervention. It also acts as a pool ball strategy creating positive cascading effects in other domains such as food security, employment, physical and mental health, inclusion and belonging, gender equality, and economic recovery to name a few.
McMaster University’s sample of 257 participants of the Ontario pilot revealed stunning results:
CERB showed that Canada is already set up to deliver Basic Income payments quickly through the tax system. Research from Canada and around the world shows us this can be a juggernaut strategy for eliminating income poverty as well as challenges associated with income. Now more than ever, the time is right to be bold and push for a Basic Income for ending poverty.
Take Your Learning Further
.