The local health unit is in support of a basic income guarantee.
On March 2 Wellington-Dufferin-Guelph Public Health (WDGPH) board members voted in favour of asking the federal government to look at the basic income guarantee as a possible policy option to help reduce poverty and increase health across the country.
The request came in the form of a letter to families, children and social development minister Jean-Yves Duclos.
A basic income guarantee is, “an income transfer from government to citizens that is not tied to labour market participation,” states a public health report. “The objective of basic income guarantee is universal income security.
“A basic income guarantee ensures that income for all individuals is at a level that is sufficient to meet basic needs and live with dignity regardless of work status.”
One of the options to achieve a basic income guarantee, the report indicates, is through the negative tax income model. The model depends on the tax system and includes three basic elements:
– benefit level, when the individual receives the maximum payment benefit;
– reduction rate, when the benefit an individual receives is decreased depending on how far additional income takes them over the allowable limit;
– break-even rate, when the individual has enough income they don’t need any more financial help.
At the March 2 WDGPH meeting medical officer of health Dr. Nicola Mercer said, “There’s many people now who made comments … even finance people who say that certainly the way that we provide supports right now is a very expensive system and that using the tax bases to streamline and to eliminate many of the systems we currently have to a more tax base model with basic income guarantee has a lot of social merit.
“And it has some significant studies now that are showing that it can work.”
The National Household Survey shows that 8.4% of Wellington County residents live in low-income circumstances, the report states. Poverty is estimated to cost between 5.5 and 6.6 per cent of Canada’s gross domestic product.
“The basic income guarantee is to bring you up to a certain level … you’re certainly not going to be high income after you have basic income guarantee, but what it is meant to do is it’s meant to level the playing field,” Mercer said.
“In public health we have always said poverty is bad for your health so … how do we attack poverty in Canada and this is a way to tackle poverty by bringing the minimum income threshold up.”
The report indicates that poverty is especially bad for children’s health, stating, “They are more likely to have a range of health problems throughout their life, even if their socioeconomic status changes later in life.”
Additionally, research shows that countries with higher rates of income inequality also have higher levels of health and social problems across all income levels.
Board member Mark MacKinnon asked if there was a different model that should be included for consideration.
Mercer replied, “There are a number of studies that have been done … if you look at the minimum wage, the living wage, because the evidence is in the short-term maybe it’s a benefit but in the longer term probably doesn’t provide that longer-term benefit.”
She continued, “What is unique about this is there are lots of different organizations who are saying this is an approach that we can support; whether they are on the right or the left of the political spectrum, they’re saying it makes sense.”
Basic income guarantee has a number of advantages over minimum wage, the report states, including:
– financing through a tax and transfer system;
– asking those who earn more to pay more for it, whereas the cost of minimum wage is largely the responsibility of the employer; and
– availability to every adult regardless of employment status, whereas minimum wage is only beneficial to those who are employed.
Board member and Wellington County Warden George Bridge said no system is perfect.
“I like this system better than raising minimum wage to $15 or whatever because there’s businesses that can’t afford that and basically what you’re going to do is have less people working for $15,” Bridge said. He added he likes that the program is “bridging the gap” and people would be able to supplement their income to a pre-determined point without being penalized.
