GLI: Investing in income security

Published in the Catalyst, Vol. 32, No. 2 - Spring 2009

Even before the economic crisis, Mary was not doing well. Last year, she was working at a local store earning the minimum wage of $8 an hour. Things were tight, and she occasionally had to visit a food bank once rent and heat were paid. Six months ago, she was laid off. She didn’t qualify for Employment Insurance (EI), because she didn’t have enough hours. With no in-demand skills, a new job was hard to find.

Mary had to turn to social assistance for income. She became a regular food bank user. She could no longer afford clothes or school supplies for her son. High oil prices meant that the cost of heating exceeded what she could afford. Bills began to pile up.

Then the economic crisis hit. Mary is beginning to lose hope that the local economy will ever recover enough for her to find a new job. She is frustrated with her lack of choices and afraid for the future.

There are many Canadians with stories like Mary’s. In 2006, 10.5% of Canadians were living in poverty, including many who held full-time jobs. Social assistance, EI and other income security programs do not ensure that all Canadians have enough income to meet their basic needs.

The economic crisis is exacerbating this reality. Thousands of jobs have been lost, and EI is inadequate to deal with the situation. The poorest Canadians are the first to lose their jobs, and will find it hardest to get new ones. Many Canadians are very vulnerable to economic circumstances beyond their control, and more Canadians will become poor as a result of the crisis.

Guaranteed livable income

CPJ believes that a guaranteed livable income (GLI) for all Canadians would promote well-being by ensuring that every Canadian had enough income to access basic resources necessary for dignity. Similar to Canada’s Old Age Security program for seniors, a GLI is an income security program that guarantees every Canadian a basic level of income.

A GLI would also have other positive impacts, including greater freedom from exploitation for those who are economically vulnerable, recognition of poorly paid and unpaid work such as caregiving and cultural activities, and likely environmental benefits from depending less on economic growth.

Evidence from Canada’s Mincome experiment in the 1970s also demonstrates that a GLI can have positive long-term health impacts.

The benefits of GLI depend on how it is structured, and there are questions of design and conditions of fairness that would need to be met in any Canadian GLI program. But GLI could help Canadians like Mary to meet all of their basic needs and support them through times of job transition or economic uncertainty.

GLI doesn’t solve everything, of course. Canadians like Mary still need supportive government and voluntary programs and services to help them lead full lives in community. Canada still needs a poverty reduction strategy to tackle many of the non-income elements of poverty.

But GLI can be one piece of the puzzle, offering greater support for well-being, more choices and greater dignity to all Canadians.

Back on the agenda

The idea of GLI has been around for many years. It is also known as guaranteed annual income, basic income or citizen’s income. CPJ advocated for a GLI in its widely supported 1986 alternative budget. While the idea lost prominence for awhile, it is now back on the agenda.

The idea re-emerged among grassroots groups looking for alternative solutions to poverty, but support is now spreading. Prominent supporters of GLI include Conservative Senator Hugh Segal, New Democratic Member of Parliament Tony Martin, Green Party leader Elizabeth May and philosopher John Ralston Saul.

Last year, a Senate committee held a roundtable – attended by CPJ – to consider the idea. The committee is now pursuing further avenues of study to examine the idea.

At the 2008 international congress of the Basic Income Earth Network, CPJ joined other Canadians in founding a BIEN Canada affiliate to promote and explore the idea in our country. A conference this fall in Ottawa will bring together politicians, advocates, academics and representatives from citizens’ groups to dialogue together about how to move the idea forward.

Responding to crisis

While some might worry that the current economic crisis makes such a big idea unaffordable, CPJ firmly believes that it makes a GLI even more necessary. The crisis highlights the economic vulnerability of many Canadians and suggests the need for new and imaginative ways of re-thinking our economy.

The looming environmental crisis also calls for a new approach, focusing less on economic growth and more on the well-being of people and our environment.

Rather than fearing GLI because of the cost, it is time to view it as an investment. A crisis should make us think about our priorities. Investing in the health and well-being of all Canadians should be our priority.

Mincome: Manitoba’s income security experiment