How will we know if a guaranteed annual income works?

John Milloy

Canadians concerned about poverty have welcomed renewed interest in a guaranteed annual income (GAI). A steady stream of supportive editorials and columns has complemented positive political statements, including the recent announcement that Ontario would be undertaking a pilot. Expectations may be so high, however, that any experiment may be doomed from the start.

The concept behind a GAI is actually quite simple. In order to address poverty, government ensures that every citizen has a minimum level of income. It’s a concept that has been around for many years and was the subject of a fairly successful experiment in Manitoba during the 1970s known as “mincome.”

Implementing it is more complicated. You could transfer a fixed amount to every Canadian and tax it back from the more well off. Or, you could use the tax system to top up the earnings of those making little or no income. Most proposals see a GAI replacing many existing government transfers to individuals, saving considerable administrative costs.

How would the mechanics work? How much would it cost? Could it be implemented uniformly in a federal system where the provinces administer much of the social assistance? What specific programs would be rolled into a GAI? Would it result in a decrease in costs associated with our health care or justice systems?

These are all good questions, but I would like to add one more: How will we know whether a GAI is a success? What is the problem we are trying to solve?

Many point to its potential to encourage those on social assistance to enter the workforce. They argue that a GAI could eliminate the disincentives to work that exist in the current social assistance system — the so-called welfare wall. Critics express doubts, saying that a GAI would encourage people to stop searching for work or even leave the workforce to enjoy what is ostensibly free money.

Some argue that a GAI could address gender inequality by recognizing the unpaid work that so many women do as caregivers. Some have even talked about its potential to help the environment by replacing a world driven by the need for never-ending economic growth with one where everyone has a basic, yet sustainable income.

In his recent blog post Jonathan Sas, the Broadbent Institute’s research director, argued that a GAI would “provide time and space for people to rededicate their creative energies” as they would no longer have to work “merely to make ends meet.” He referenced his many artist and musician friends who “are forced to work in service industry jobs in order to pay rent, when they could be putting their productive capacities towards their art form.”

This is getting crazy!

Positioning a GAI as a magical program that will encourage creativity, help the environment, address gender inequality and encourage employment along with ending poverty is a little overwhelming — no pilot will ever live up to these expectations.

What if we started with a simple proposition? Canada is a wealthy country and all of its citizens should live their lives with dignity, regardless of their economic circumstances.

Defining dignity is not as hard as it might appear. A number of years ago the Ontario government worked with the Daily Bread Food Bank and the Caledon Institute of Social Policy to develop something called the Deprivation Index.

Based on work done in the U.K. and Ireland, the index outlines the basics that everyone should have in a wealthy society: access to nutritious food; dental care; transportation; an appropriate wardrobe for a job interview; a hobby; the ability to either replace or repair a broken appliance; a home free of pests; and the ability to entertain friends and family once a month as well as buy small gifts for them once a year — things many of us enjoy.

It may take some time to warm up to this list. We tend to see the poor as “the other,” often categorizing them as “deserving” or “undeserving” based on their willingness to work. We don’t like to think about them as individuals who simply desire the same kinds of things we want. As a result, society has never reached a consensus on the goal of the social safety net. Is it to provide recipients with only minimal subsistence to persuade them to leave the system quickly, or to actually provide them with meaningful support?

So here is an idea for the pilot project: What if we provide everyone in a specific community the minimum income needed to live their lives in dignity, and then see what happens over time? Will the community be happier, healthier, safer and more cohesive? Will it create a greater sense of solidarity, or build resentment?

Although these findings might lack drama, they might tell us something about the type of Canada we really want and are willing to support.

John Milloy is a former Ontario cabinet minister who served as MPP for Kitchener Centre from 2003 to 2014. Prior to that, he worked on Parliament Hill, including five years in the office of Prime Minister Jean Chrétien. He is currently the Co-director of the Centre for Public Ethics and Assistant Professor of Public Ethics at Waterloo Lutheran Seminary, and the inaugural Practitioner in Residence in Wilfrid Laurier University’s Political Science department. He is also a lecturer in the University of Waterloo’s Master of Public Service Program. John can be reached at: jmilloy@wlu.ca or follow him on twitter at: @John_Milloy.