Basic income guarantee: What’s the BIG idea?

There’s new interest in an old idea: a basic income guarantee (BIG), also known as a guaranteed minimum income (GMI) or a universal basic income (UBI). 

While names and proposals vary, the key concept is that government should ensure a basic minimum income for all. Many countries already do to some extent through social assistance and other income support programs, but these often involve means-testing and provide below poverty-level incomes. 

A GMI would replace or supplement existing income support programs with a simple basic income guarantee, with the goal of eliminating poverty.

It may seem radical, but the idea’s been around for a long time and has support that spans the political spectrum. Former conservative senator Hugh Segal has advocated a GMI for years, many anti-poverty activists support it, Scandinavian countries are trying it and now Canada’s new federal Minister of Families, Children and Social Development wants to examine the idea. 

There’s renewed interest because we haven’t made real progress on improving social assistance, precarious employment is on the rise, and robotic automation may lead to economic growth with few jobs. 

A GMI would have to be carefully designed and implemented. Some conservatives like the idea because they see it as a way to dismantle the social welfare state and replace it with a monthly cheque. Some businesses like that it could subsidize them paying low wages. Others are concerned it wouldn’t reduce poverty, would cost too much and could reduce incentives to work. 

Few people know Dauphin, Manitoba, was the site of a pilot basic income project 40 years ago. The provincial NDP and federal Liberal governments introduced a “Mincome” in 1974. The project was cancelled five years later when federal and provincial Conservative governments took over. It was never officially evaluated.

The GMI was hotly debated at the time. Unions and other progressive groups supported a basic income, but only as part of a comprehensive program that attacked the root causes of poverty by providing decent jobs, adequate incomes and quality public services for all. This position is as relevant today as it was then. 

In 2011, analysis of the Dauphin project’s archive files found many positive social and health benefits, and that it didn’t really reduce incentives to work. When it did, it was often for positive reasons, like caring for infants or completing education.  

A guaranteed income isn’t enough on its own. We need fundamental changes that make our economy work for everyone. That means decent well-paid jobs, a higher minimum wage, a more progressive tax system, and improvements to universal public services. With these changes, everyone will be able to contribute productively to society with dignity, as equals and according to their needs.