Greater Sudbury is interested in taking part in a provincial pilot program that would provide basic income to social assistance recipients in selected cities.
The goal is to improve health and other long-term outcomes for lower-income residents, says a staff report heading to the community services committee Jan. 16.
“Typically, a basic income is a form of assistance that is guaranteed to recipients that qualify,” the report says. “It has also been referred to as a basic income guarantee benefit.
“Recipients are not required to work, look for work, or participate in education or training to receive the payment. Generally, the payment is based on annual income.”
The intent of a basic income is to lift more people out of poverty, the report says, as well as to simplify the income security system, improve people’s health, empower people to get jobs and help people afford housing.
A basic income also gives “people more certainty and empower them to spend less time navigating a complex system, and more time actively participating in the economy,” the report says.
Former Conservative Senator Hugh Segal was selected as the special adviser and has recently released a discussion paper, Finding a Better Way: A Basic Income Pilot for Ontario. It includes suggestions and considerations for a pilot program in Ontario.
The paper recommends that the pilot be a negative income tax system, in which people who earn less than a certain amount don't pay tax, but instead receive money from the government to bring their income up to a minimum level.
“Then, for each dollar of earned income, benefits are reduced by less than a dollar (less than 100 per cent tax back rate), until benefits are paid back in full,” the report says.
“The basic income pilot could test one or multiple tax-back rates. A tax-back rate is the percentage that a benefit is reduced, as a recipient’s earned income increases.”
The focus of the pilot would be on studying what impact a basic income has on poverty reduction, jobless rates, service delivery and health.
The province wants to launch the pilot in one community in the south and north, one First Nations community and a control group. A meeting was held in Sudbury last month on the pilot, one of 12 being held between November and the end of January.
Details of how the program will work are expected by the end of March.