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RCO





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PostPosted: Mon Apr 24, 2017 2:42 pm    Post subject: Ontario to launch a guaranteed minimun income pilot project Reply with quote

Hamilton, Lindsay and Thunder Bay first in Ontario to receive guaranteed minimum income in three-year pilot project


The Canadian Press | April 24, 2017 11:54 AM ET
More from The Canadian Press
.
The level of support starts at just under $17,000 a year for single people.

Postmedia NetworkThe level of support starts at just under $17,000 a year for single people..



HAMILTON — Residents of Hamilton, Lindsay and Thunder Bay will be the first Ontarians to receive a guaranteed minimum income as part of a new provincial pilot project.

Premier Kathleen Wynne announced the details of the province’s three-year basic income project today in Hamilton.

She said the level of support starts at just under $17,000 a year for single people, and while that isn’t extravagant, she says it will make a real difference in people’s lives.

The government consulted former senator Hugh Segal for advice on building the pilot project.

Segal said the basic income should replace Ontario Works and the Ontario Disability Support Program payments, but be slightly more generous, and it should come with less monitoring and administration than those programs.


The Liberal government announced the pilot project in the 2015 budget.

http://business.financialpost......ot-project
RCO





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PostPosted: Mon Apr 24, 2017 2:45 pm    Post subject: Reply with quote

News Release

Giving More People an Opportunity to Get Ahead and Stay Ahead

Ontario Basic Income Pilot to Launch in Thunder Bay, Hamilton and Lindsay


April 24, 2017 9:15 A.M.

Office of the Premier

Ontario is launching a pilot project to assess whether a basic income can better support vulnerable workers, improve health and education outcomes for people on low incomes, and help ensure that everyone shares in Ontario's economic growth.

Premier Kathleen Wynne announced details of the Ontario Basic Income Pilot (OBIP) project today at LiUNA Station in Hamilton. The three-year study will test how a basic income might expand opportunities and job prospects of those living on low incomes while providing greater security for them and their families.

Ontario's economy is in a relatively strong position, however many people in the province are not feeling that growth in their everyday lives. People are struggling to keep up with the rising cost of living and facing "precarious employment" with little job security or benefits. This pilot will study whether a basic income can bridge that gap and give people the security and opportunity they need to achieve their potential.

Three regions will take part in the study. Pilots will start in late spring in Hamilton, including Brantford and Brant County; and in Thunder Bay and the surrounding area. The third pilot will start by this fall in Lindsay.

The Basic Income model Ontario has developed will ensure that eligible participants receive:

•Up to $16,989 per year for a single person, less 50 per cent of any earned income
•Up to $24,027 per year for a couple, less 50 per cent of any earned income
•Up to an additional $6,000 per year for a person with a disability.

A basic income supports people to begin or continue working, or to further their education. Participants in the pilot will be able to increase their total income by combining a basic income with 50 cents from every dollar they earn at work.

Through this pilot, people who earn less than the basic income amount through employment will receive regular payments to help them better afford basic needs such as housing and food. The three test regions will host 4,000 participants eligible to receive a basic income payment, between the ages of 18 to 64. By late spring, people in these areas will begin receiving information about the pilot and how to participate. The province is partnering with these communities and other experts to make sure that the Ontario Basic Income Pilot is fair, effective, and scientifically valid.

Ontario is also in the early stages of planning a separate, parallel First Nations Basic Income Pilot, co-created and designed with First Nations partners.

Our approach to basic income is a simplified way to deliver income support that provides a floor under which nobody can fall, regardless of their circumstances. The design was based on advice received from Special Advisor on Basic Income, Hugh Segal, who delivered his report in November. It was also informed by the thousands of people and organizations we heard from during our province-wide consultations.

Ensuring everyone has the opportunity to reach their potential is part of our plan to create jobs, grow our economy and help people in their everyday lives.


Quick Facts
•Ontario is one of a number of places, including Finland, Kenya and the Netherlands, that have launched or are considering a basic income program.
•People eligible for the Ontario Basic Income Pilot will be randomly chosen to receive the basic income or to be part of a control group who don’t receive it.
•People receiving support through Ontario Works who enter the pilot will continue to receive the Ontario Drug Benefit, and people on the Ontario Disability Support Program will continue to receive the Ontario Drug Benefit and dental benefits.
•A single person earning $10,000 per year from a part-time job would receive an additional $11,989 in basic income ($16,989 less 50% of their earned income), for a total income of $21,989.
•A third-party research consortium that will evaluate the study will be announced shortly. The province will form an advisory group with research and evaluation experts to ensure that the pilot is conducted with the utmost integrity, rigour and ethical standards.


Background Information
•Ontario's Basic Income Pilot

https://news.ontario.ca/opo/en/2017/04/giving-more-people-an-opportunity-to-get-ahead-and-stay-ahead.html
RCO





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PostPosted: Mon Apr 24, 2017 2:48 pm    Post subject: Reply with quote

Premier Wynne announce pilot project for Basic Income Guarantee for Lindsay

News Apr 23, 2017 08:44 by Lois Tuffin  Peterborough This Week|



The premier will announce Monday morning which community will be the testing ground for the Basic Income Guarantee.


- Bernard Weil / Toronto Star



Lindsay will be the third part of the Province to test the Basic Income Guarantee.

This morning, Premier Wynne announced that Hamilton will get the program first, followed by Thunder Bay and then Lindsay by autumn.

Wynne was joined by Minister of Community and Social Services Helena Jaczek and Housing Minister Chris Ballard, whom is also responsible for Ontario's Poverty Reduction Strategy.

"One income used to be enough," said Wynne, and added now households sporting two incomes are still struggling.


The three year pilot project will come to the three communities and benefit 4,000 people. It will also be a research opportunity for the success of basic income guarantees. The project will cost $50 million annually.

"We want to find out whether a basic income makes a positive impact in people's lives," she added.

She said the amount is "not extravagant" at "just under $17,000 a year," for individuals but added it would help people who are working to improve their living situation.

The amount is guaranteed "no matter what," said Wynne.

Members of the community who meet the criteria for the program will be randomly selected and have to apply, and Wynne said not every applicant will be enrolled. She also said the pilot communities were chosen "intentionally, because they are the right size and have the right kind of population."

Assistant Deputy Minister of the Poverty Reduction Strategies Office Karen Glass said applicants could include homeless people who use shelters

https://www.mykawartha.com/news-story/7257475-premier-wynne-to-announce-pilot-project-for-basic-income-guarantee-for-this-area/
RCO





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PostPosted: Mon Apr 24, 2017 2:50 pm    Post subject: Reply with quote

April 19, 2017 9:32 am Updated: April 19, 2017 9:47 am

Commentary: The problem(s) with a guaranteed annual income

AM640
Tasha Kheirriden By Tasha Kheiriddin
Radio Host AM640/Global News


Policy-makers and the public in Canada and around the world are eyeing the basic guaranteed income scheme again, buoyed by an evolving labour landscape and technological advances that have left them wondering if today's social services are enough.

THE CANADIAN PRESS/Richard Plume




From Italy to India, the basic annual income is back in the news. Around the world, eight jurisdictions — including Kenya, Finland, the Netherlands, Uganda and California — are conducting experiments providing regular payments to cover basic living costs, regardless of recipients’ economic situations.


With welfare programs consuming billions of tax dollars without eliminating poverty, and with robots poised to seize more jobs and make more people redundant, governments are seizing the moment and launching test runs of different types of guaranteed annual income (GAI) programs.

Add Ontario to the list. This month, the provincial government will unveil a basic income pilot project. “It’s a rare opportunity to make some real change,” said Housing Minister Chris Ballard, one of two ministers leading the initiative. “There has been so much talk, so much written. A little bit of study here, a little bit of study there. A lot of theory. We’re going to have an opportunity to do a rock-solid pilot that is either going to prove or disprove it.”

READ MORE: How would a guaranteed annual income work in Canada

The concept of a guaranteed annual income finds favour on both the left and the right, attracting political bedfellows as strange as U.S. Senator (and former presidential aspirant) Bernie Sanders, the late civil rights champion Martin Luther King, neoclassical economist Milton Friedman and conservative social policy writer Charles Murray.

“Unconditional cash transfers,” the Toronto Star reports, “are even touted as an antidote to the rise of alt-right populism that fueled the U.K.’s Brexit and the election of Donald Trump.”


But as with any policy shift, there would be unintended consequences stemming from a guaranteed annual income — and they might not be the ones that first come to mind. Indeed, the real effects of a basic income might be felt less in terms of the work ethic than in family dynamics. And that could pose a serious paradox for some anti-poverty activists — particularly feminists.

READ MORE: Ontario government, Senator calling for guaranteed annual income pilot project

A basic income causes people to “work differently, not necessarily less,” according to researchers at the Mowat Centre, a think tank attached to the University of Toronto that studied previous experiments in Canada and the United States.

“Among married women receiving a basic income … annual hours worked decreased by as much as 28 per cent. For married men, the reduction was as high as eight per cent. On the other hand, the Manitoba experiment revealed reductions as small as three per cent and one per cent respectively.”

Another study conducted at Queen’s University found a similar trend in American experiments: Studies showed a reduction of hours worked by single, female heads of households of between seven and 30 per cent.

Why did the women cut back their hours more than the men? According to author Melissa Martin, “preschool children increased the labour supply of husbands, while reducing the labour supply of wives by approximately the same amount. Thus, changes in family composition may have a greater impact on labour supply than a GAI (guaranteed annual income) program itself.


“If the GAI were to be applied in a Canadian context, it is important to consider the effect on labour-supply the GAI might have, as well as the potential positive impacts resulting from the ability of individuals to stay home to care for children and elderly relatives.”

Ironically, this confirms what a lot of studies have found for years: Given the economic choice, many parents — particularly mothers — would choose to stay home with their young children rather than farm them out to daycare.

A basic annual income would enable more of them to do this, which means more would choose to do it — which would mean less demand for childcare, fewer jobs in the childcare industry and lower female participation in the labour force overall. That’s not to mention how a basic annual income would negate the need for policies like Quebec’s $7.75-a-day (and up, depending on family income) subsidized daycare, or Ontario’s recent pledge to create 100,000 daycare spaces.


From the perspective of children and families, this could be a positive (unintended) consequence of a basic income — but it poses a conundrum for social justice warriors who both want to end poverty and get more women into the work force.

As for supporters of parental choice … would they support giving everyone a basic income, regardless of family situation, when it would cost an estimated $8 billion a year to lift all Ontarians out of poverty?

A British study of a basic income (conducted by advocates of the idea) calculated that it would require significant tax hikes for all income groups: bottom rates would rise from 20 to 48 per cent, top rates from 45 to 73 per cent. Would taxpayers in Ontario be willing to see similar increases when they’re already grappling with the skyrocketing cost of housing and rising hydro rates?

There’s another hidden catch. As Charles Murray points out, “a Universal Basic Income will do … good things … only if it replaces all other transfer payments and the bureaucracies that oversee them. If the guaranteed income is an add-on to the existing system, it will be as destructive as its critics fear.”

That’s the real rub: Would a government embracing a guaranteed annual income actually downsize? It’s hard enough to dismiss civil servants under normal circumstances. Start eliminating entire departments and you’d see outright revolt in the public service, and among the unions who would see their power and income erode.

For Ontario Liberals, sticking it to organized labour is a non-starter; while the results of this pilot won’t be known in time for the next provincial election in October 2018, it’s hard to imagine future politicians promising to, say, eliminate 100,000 government workers made redundant by a basic income program.

Which is why, despite the good intentions it implies, Ontario’s basic income experiment likely will be just that — a test run that will please some, displease others and crumble under the weight of politics.

http://globalnews.ca/news/3388.....al-income/
RCO





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PostPosted: Mon Apr 24, 2017 2:53 pm    Post subject: Reply with quote

Ontario launches guaranteed income program for 4,000 residents



by Alanna Petroff @AlannaPetroff
April 24, 2017: 12:34 PM ET



The Canadian province of Ontario will become the latest place to test a guaranteed income program for low-income residents.

The provincial government launched a pilot program on Monday that will provide 4,000 people with a guaranteed income, regardless of their employment status.



The idea of a guaranteed -- or "basic" -- income is gaining currency around the globe. Supporters say the schemes offer workers greater security, especially as technological advances reduce the need for human labor. They also allow unemployed people to pick up odd jobs without losing most of their benefits.

Individuals in Ontario's program can receive up to 16,989 Canadian dollars ($12,616) per year. In order to qualify, applicants must be between the ages of 18 and 64 and living on a limited income.

The government said it wants to see whether the program can "support vulnerable workers, improve health and education outcomes for people on low incomes, and help ensure that everyone shares in Ontario's economic growth."

Researchers will monitor participants on criteria related to mental health, food, housing, education and employment.

Invitation letters will be mailed to potential participants over the next few weeks.



The program is designed to encourage participants to earn their own salary, but it gives them an income to fall back on if they fall on hard times or want to pursue further education. People in the program will receive less government money if they earn more on their own.

"People are struggling to keep up with the rising cost of living and facing 'precarious employment' with little job security or benefits. This pilot will study whether a basic income can bridge that gap and give people the security and opportunity they need to achieve their potential," the government said in a statement.



Finland launched a similar program in January. The government promised to give 2,000 citizens a guaranteed income, with funds that would keep flowing whether participants work or not.

The Netherlands and Kenya are also considering pilot projects for guaranteed income.


Ontario's experiment comes about 40 years after a similar concept was tested in another Canadian province -- Manitoba.

Researchers found the 1970s program led to health improvements, with no meaningful reduction in the workforce participation rate.

The current unemployment rate in Ontario is 6.4% -- just slightly below the national average.

The province is the most populous in Canada with nearly 12 million residents.

http://money.cnn.com/2017/04/2.....e-program/
RCO





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PostPosted: Mon Apr 24, 2017 3:07 pm    Post subject: Reply with quote

after trying to read thru some articles to try and figure out exactly what is being proposed I was left with many questions

1. what would it cost to launch this program on a province wide scale ? its mentioned it will cost $50 million a year for the test project but its only for 4000 people in a couple of cities . there is many more people province wide who could possibly qualify for such a program , on a province wide scale we could be talking about $billions of dollars a year , which is unaffordable to a province already massively in debt


2. is the program about supplementing an income of someone who has a low paying job or about providing more income for someone on welfare or disability ?


3. how would this effect low paying employers and there continued struggle to find employees ? pretty much every tim hortons you drive by is looking for staff ? if lower income people knew they could simply get on a guaranteed government income program , would they still have any motivation to work such jobs ?

4 . would such a program create a class of citizens who were entirely dependent on government hand outs and had no way to get ahead ? if someone is unemployed and has been collecting a guaranteed income for a few years . they could have no way to get out of the situation . if there resume is stale and out of date , and they possess few employable skills it may be challenging for them to find future meaningful employment
Progressive Tory





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PostPosted: Tue Apr 25, 2017 7:09 am    Post subject: Reply with quote

If a national guaranteed income could be brought in that got rid of federal, provincial and municipal programs like CPP, OAS, EI, welfare, etc. I think it could be worthwhile. It could shrink government considerably while also providing a better standard of living. It's still probably not feasible though.
RCO





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PostPosted: Wed Apr 26, 2017 6:27 am    Post subject: Reply with quote

Wynne’s plan sounds like welfare


First posted: Tuesday, April 25, 2017 07:26 PM EDT | Updated: Tuesday, April 25, 2017 07:31 PM EDT



wynne
Premier Kathleen Wynne's three-year pilot project in which the government will select 4,000 low-income households from Hamilton, Thunder Bay and Lindsay, sets off alarm bells. (THE CANADIAN PRESS/PHOTO)


There’s a conservative case to be made for a guaranteed annual income.

The problem is Ontario Premier Kathleen Wynne is just about the last politician we trust to make it.

In theory, a guaranteed income to low-income individuals and families, paid for by dismantling the myriad of provincial, federal and municipal welfare and social programs we have today, makes sense.

Done properly — a big “if” — it reduces the cost of government bureaucracy, which adds enormously to the cost of social assistance programs.

It can also increase the financial independence of those receiving the guaranteed annual income, who are no longer beholden to government bureaucrats for the money they receive.

Finally, a guaranteed income can be designed to increase the incentive to work, by allowing individuals and families to keep more of the money they earn beyond the minimum, without incurring financial penalties.

Wynne’s plan, however, a three-year pilot project in which the government will select 4,000 low-income households from Hamilton, Thunder Bay and Lindsay, sets off alarm bells.

It appears to be a slapped together initiative amounting to yet another form of social assistance, costing taxpayers $50 million more annually, in which individuals chosen will be paid a minimum of $17,000 annually, couples $24,000.

For a minimum income program to be credible, it should be paid out of existing public funds, by redeploying money now being spent on welfare and social assistance programs.

Indeed, the decreased cost of government bureaucracy should be used to increase financial support to low-income households.

In fairness, Wynne’s pilot project does permit people receiving a minimum income to keep half of the money they earn above the minimum.

But this appears to be just another provincial subsidy program, rather than a serious reworking of welfare and social assistance programs and payments available from all three levels of government.

It would be interesting to know what criteria the government is using to invite some individuals and families to participate in this pilot project, while rejecting others.

Talk about a potential for pitting neighbour against neighbour.

In short, there is a germ of a good idea in a minimum annual income, but not enough to overcome our concerns about how Wynne intends to implement it.

http://www.torontosun.com/2017.....ke-welfare
Bugs





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PostPosted: Wed Apr 26, 2017 7:13 am    Post subject: Reply with quote

Wynne's plan IS welfare. It's also deluded thinking.

For practical purposes, the bottom of the rental market is set by the housing allowance part of welfare payments. This is one of the dilemmas -- if welfare rates are increased, rents go up -- not just at the bottom of the market.

This plan means to give everybody a living wage -- but the problem is, as soon as large numbers of people get a 'living wage for not working. costs go up, and the living wage needed to keep pace must go up too. It becomes a vicious spiral of rising costs. It's the same with the minimum wage. The higher that goes, the fewer people have jobs, and the costs of the services provided by minimum wage people go up too.

It's like a poverty machine.

There is a long history of welfare, and most of the variables have already been tested. The results are predictable. As PT noted, it only makes economic sense if all the government bureaucracies administering these monies are shut down. Which gives you an idea of how much it costs to give this money out right now!
RCO





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PostPosted: Wed Apr 26, 2017 7:14 am    Post subject: Reply with quote

Progressive Tory wrote:
If a national guaranteed income could be brought in that got rid of federal, provincial and municipal programs like CPP, OAS, EI, welfare, etc. I think it could be worthwhile. It could shrink government considerably while also providing a better standard of living. It's still probably not feasible though.



since its only a pilot project its unclear exactly what Wynne is proposing . the pilot project could also be cancelled or simply not ever implemented if another party wins the next election . I highly doubt the pc's would be interested in this plan especially on a province wide scale .

by my calculations if there was 100,000 recipients at $10,000 a year that would cost around $ 1 billion dollars a year , so 200,000 recipients would cost around $2 billion but considering the size and population of Ontario I think those numbers are low .

500,000 recipients would cost $5 billion a year and this would be a yearly expense that would surely grow each year as more got accepted into the program , ( if there was 1 million recipients it could cost around $10 billion a year ) considering Ontario's population is 13.6 million I don't think its out of the question that those sort of numbers would be possible ) it would almost certaintly plunge the province more into debt and eliminate any balanced budgets


its also unclear how serious Wynne is about the idea , it was only a couple years ago she ran tv ads and said she was going to bring in a provincial pension plan only to give up on the idea shortly after trudeau won . it was speculated the whole idea was simply to create a fued between herself and harper going into the 2015 election
RCO





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PostPosted: Wed Apr 26, 2017 7:40 am    Post subject: Reply with quote

Bugs wrote:
Wynne's plan IS welfare. It's also deluded thinking.

For practical purposes, the bottom of the rental market is set by the housing allowance part of welfare payments. This is one of the dilemmas -- if welfare rates are increased, rents go up -- not just at the bottom of the market.

This plan means to give everybody a living wage -- but the problem is, as soon as large numbers of people get a 'living wage for not working. costs go up, and the living wage needed to keep pace must go up too. It becomes a vicious spiral of rising costs. It's the same with the minimum wage. The higher that goes, the fewer people have jobs, and the costs of the services provided by minimum wage people go up too.

It's like a poverty machine.

There is a long history of welfare, and most of the variables have already been tested. The results are predictable. As PT noted, it only makes economic sense if all the government bureaucracies administering these monies are shut down. Which gives you an idea of how much it costs to give this money out right now!



you have to wonder about the real motivations of this plan , in Canada so far only NDP politicians have openly talked about a guaranteed income , I believe the leadership candidate from Quebec Guy Caron is in favour of it .

so is this possibly an attempt to undermind the surging Ontario ndp before they come out with something similar ? the choice of pilot project cities is also odd , Hamilton is the home riding of ndp leader Andrea Howrath and both thunder bay ridings are top targets for the ndp as well

its sort of like the ultimate vote buying scheme as well , its like showing up at a poor person's house with a bag of money and telling them if they vote liberal they get an extra $10,000 a year

but of course the money has to come from somewhere ? Ontario has not discovered Oil and suddenly much wealthier . are people willing to see more hospitals and schools close and province go deeper in debt so we can give poor people free money ?
Progressive Tory





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PostPosted: Wed Apr 26, 2017 7:42 am    Post subject: Reply with quote

I think the only way such a program could possibly work is for the Feds, provinces and territories to collaborate.
RCO





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PostPosted: Thu Apr 27, 2017 6:53 am    Post subject: Reply with quote

Why free money is a hard sell in tough times: Cohn


If you don’t know what to make of a guaranteed basic income, you’re not alone.


As Kathleen Wynne argued this week, the basic income plan goes to the core of what governments can do amid economic and employment volatility — but the same argument applies to pharmacare, which (like the basic income) attracts support from both left and right, writes Martin Regg Cohn.




By Martin Regg CohnOntario Politics Columnist

Wed., April 26, 2017



Free money can be a hard sell.

People in need will surely take it in. People of means, however, may not like the idea of giving it out — not at their expense.

Thursday’s budget will formalize an ambitious pilot program for 4,000 eligible volunteers to be guaranteed an annual income of $17,000 by the government over three years. If you qualify, the money flows whether or not you work, which works in your favour — in good times and bad, for better or for worse.

If you don’t know what to make of the guaranteed giveaway, you’re not alone. The concept has confounded social policy analysts, politicians, economists and ideologues of the left and right for decades.

It’s a bold idea, but not overly original. In the early 1970s, Manitoba briefly experimented with a minimum income before giving up on the idea for lack of interest and support

But our world has changed, and Ontario’s economy along with it. The go-go growth of four decades ago was not an ideal incubator for an idealistic income support program.

Critics might have said, back then (if not now): Get a job.

People on the right or left might well have argued whether a guaranteed income could discourage people from working hard — or looking hard. All these years later, we know that economic progress can also be precarious for employment.


Today it’s possible to get a job, but harder to keep a job, because jobs for life turned out to be short-lived. Even the most energetic full-time multi-tasker of part-time jobs can only fantasize about a forever factory job in a manufacturing heartland that has rapidly de-industrialized.

Pick your poison: globalization, automation, artificial intelligence or information technology. You don’t have to be a rocket scientist to know that jobs for rocket scientists — and the rest of us (and our children) — aren’t what they once were.

Against that backdrop, the guaranteed minimum payout has been rebranded a basic income. And updated to take account of income levels and, increasingly, uneven incomes — which is to say, incomes that come and go over the years.

It is still minimal — $17,000 a year won’t buy you a life of easy survivability, let alone affordability. It is 75 per cent of Ontario’s low-income measure (a quasi-poverty line) of about $22,653 — calculated as half the median income in the province.

But it has the incalculable advantage of clarity, efficiency and humanity. It is an alternative to the dehumanizing bureaucracy of welfare, with all its necessary checks and unnecessary balances.

Not just for the poor, nor the working poor, not even the well-off working class of the past. Consider the middle class of today and tomorrow, watching their paycheques go up and down as work comes and goes from one year to the next, wondering if they’ll qualify for unemployment benefits, and marvelling at the workplace benefits their parents counted on for prescription and dental bills.

That’s why the current economic context counts for so much in any consideration of a basic income. Weighing the costs and benefits, it’s also worth waiting for the facts to come in from this three-year trial before prejudging human behaviour and economic outcomes.

The only certainty is that it is far from a sure thing. The Liberal government deserves credit for launching an experiment that could easily fail, just as its previous proposals to streamline an outdated welfare system quickly lost momentum.

In the same week that Premier Kathleen Wynne unveiled her basic income experiment, NDP Leader Andrea Horwath called for a provincial pharmacare program, trying to put the Liberals on the spot. Both proposals could prove life-saving, but they are distinctly different.

A basic income pilot is more abstract and hence harder for voters to imagine benefiting them. Universal pharmacare is easy to understand because it offers tangible benefits up front (saving money and lives through bulk-buying and a single-payer system).

First promised in last year’s budget, the basic income plan is a centrepiece of Thursday’s budget and will form a major plank in next year’s Liberal election platform. As Wynne argued this week, it goes to the core of what governments can do amid economic and employment volatility — but the same argument applies to pharmacare, which (like the basic income) attracts support from both left and right.

Free money for some versus free drugs for all? A good government would give us both.

https://www.thestar.com/news/queenspark/2017/04/26/why-free-money-is-a-hard-sell-in-tough-times-cohn.html
RCO





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PostPosted: Thu Apr 27, 2017 8:35 am    Post subject: Reply with quote

( an interesting article in the post about this scheme , the economics professor also came up with similar numbers as mine , he assumed it cost around $15 billions to implement province wide and province would have to raise HST 5 points to generate enough revenue to pay for the scheme . he also thinks most of the money would go to young adults who still live with parents and would already qualify for student assistance anyways so it wouldn't improve access to education )



Kevin Milligan: Ontario’s ‘basic income’ pilot will send the most money to grownup kids who still live with mom and dad


Kevin Milligan, Special to National Post | April 27, 2017 9:13 AM ET
More from Special to National Post



Ontario Premier Kathleen Wynne revealed her plans this week for the long-promised pilot study on Basic Income. Advocates for Basic Income schemes want to replace traditional social assistance with a new, simpler way to fight poverty. Basic Income plans try to improve the incentive to work while not busting the budget. The news that the pilot study is going forward will enthuse researchers, but the eventual cost of Basic Income may leave taxpayers less than satisfied. And if they implement it as promised, most of the money may end up going to young adults who live with their mom and dad, which means the whole scheme could end up targeting the wrong people.

Here’s how Ontario’s Basic Income plan will work. Four thousand low-income Ontario residents in three communities will be offered a spot in the pilot study. If selected, they will receive a Basic Income payment instead of standard social assistance. The annual payment is set at $16,989 for single individuals, or $24,027 for married couples. An additional $6,000 per year will be provided to individuals with disabilities. Recipients get to keep any child benefits, dental and pharmaceutical access, and disability supports to which they are already entitled. But, their Basic Income payment shrinks by 50 cents on the dollar of earnings, and by 100 cents on the dollar of CPP or EI income.

Canada currently spends about $140 billion every year on income transfer programs. As a researcher, I don’t think we should turn down an opportunity to learn about better ways to deliver this big packet of benefits. In particular, I see two key areas where the Ontario pilot study could help move research forward.


Canada spends $140 billion every year on income transfer programs. We shouldn’t turn down an opportunity to learn about better ways to deliver this big packet of benefits.
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First, we will learn more about how incentives affect work decisions. The Ontario plan stacks a 50 per cent phase out rate on top of the existing 20 per cent income tax rate on low earners. If you add in CPP and EI payroll taxes and the phase out of income-tested child benefits, we could see Basic Income recipients retain only 10 cents on a dollar of earnings. Decades of research show that 90 per cent tax rates lessen individuals’ motivation to keep working at full speed. The Ontario Basic Income pilot study may shed new light on how much these disincentive effects matter.

Second, we will learn more about the spending habits of low-income recipients. My research has shown that low-income parents who receive an income boost spend more on food and shelter and suffer less from depression. These kinds of targeted interventions can do a lot of good and set children on a better trajectory—which could also benefit the public treasury in the long run.


However, the Basic Income scheme targets a wide range of adults who may not actually require the benefit. An analysis of Statistics Canada income data tells me that if you implemented the proposed Basic Income scheme across Ontario, most of the money would likely go to young childless adults living with their parents. Ontario already offers free tuition to most lower-income students, so the extra money wouldn’t improve access to higher education. It’s not clear that giving money to young adults who live at home is a high social priority—but it sure will be interesting to see how they spend the extra cash!

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A better Basic Income pilot project would also test ways to simplify the existing web of programs that low-income Ontarians must navigate to receive benefits. Unfortunately, Ontario’s plan shows little promise of doing so. The bureaucratic system that determines eligibility for disability, drug, and dental benefits remains in place. That may well be inevitable, but it falls short of the simplified entitlement scheme that Basic Income advocates promote.

Whatever positive outcomes result from the pilot study will have to be weighed against the cost of the program. I did a preliminary analysis with income data from Statistics Canada and found that, if implemented province-wide, Ontario’s Basic Income scheme could cost $15 billion or more. Ontario would need to add at least five points to its HST to raise that kind of revenue. Hopefully, after the evidence from the pilot studies come in, the government will let Ontario taxpayers decide whether the benefits of the new scheme justify that cost.

National Post

Kevin Milligan is a Professor of Economics at the University of British Columbia, Vancouver School of Economics

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PostPosted: Thu Apr 27, 2017 10:11 am    Post subject: Reply with quote

This will be one of the straws in the wind during the election campaign. The verdict won't be in, as far as the results go, and the first batch of people on the program will likely be selected and be the most likely to use their time productively. There is probably a sub-set of single mothers, for example, who could use the money to support themselves while they get some training in an area where there are job quotas favouring women, particulaly single mothers. (You may not like me saying that, but that's what the labour market is like these days -- it matters a lot what 'demographic' you're in, and you'd better not be a white male.)

But what history shows is that free money encourages laziness. You might think that someone on welfare would use their extra time to find a way of eating that substituted some of their labour for more elaborate cooking, from 'scratch' as they used to say. But welfare people guts up on things that the professional classes wouldn't allow in the house. If they want to turn a dollar, it's a lot better to do so in a way that doesn't have to be reported. Selling sex or drugs is one attractive avenue, but there are other things that don't pay as well, but which can produce income. Short term black market work.

The problem is the work ethic evaporates. Not with everybody, but with lots.

That's the pattern. And that's why it can't work on a broad scale. Imho. But there is a second reason that it can't work. It's the the increased costs of such a plan would be job-killers. More and more people would be at the window, getting enrolled in the plan, and they all would qualify. That would mean, in the end, a vicious cycle of welfare and job-losses, and it would feed itself.

But it can work for a party going into an election. It's like a flash of thigh and a wink, promising greater 'benefits' later.

It's Patrick Brown's job to rally the opposition against it. Or do politicians do that anymore? Perhaps they prefer to run a TV ad saying we'll do the same thing, only better.
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Ontario to launch a guaranteed minimun income pilot project

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