In 2017, the government of Ontario, Canada’s most populous province, kicked off a three-year basic income pilot project. Basically, it handed out enough money to cover basic needs to some 4,000 people — and the data suggests that the program was an enormous success.
And according to a new report by researchers who worked on the project, participants became happier and healthier. The project, they wrote, had a “noticeable impact on the use of health services,” with many participants seeing fewer doctors and going to the emergency room less frequently. More than 50 percent claimed to use less tobacco, while 48 percent said they were drinking less alcohol.
“Knowing I had a purpose, and being able to make a plan, because the extra financial resources allowed me to do that, does something profound to your mental health,” an anonymous 37-year-old woman said, as quoted by the report.
But then the government scrapped the entire $150-million program.
“A research project that included only 4,000 individuals was not an adequate solution for a province where almost two million people are living in poverty,” a government spokeperson told the CBC. “We are focused on solutions for Ontario that are practical and sustainable.”
quote:Province argues pilot project was not an 'adequate solution' to poverty in Ontario
articipants in Ontario's prematurely cancelled basic income pilot project were happier, healthier and continued working even though they were receiving money with no-strings attached.
That's according to a new report titled Southern Ontario's Basic Income Experience, which was compiled by researchers at McMaster and Ryerson University, in partnership with the Hamilton Roundtable for Poverty Reduction.
The report shows nearly three-quarters of respondents who were working when the pilot project began kept at it despite receiving basic income.
That finding appears to contradict the criticism some levelled at the project, saying it would sap people's motivation to stay in the workforce or seek employment.
"They continued working," Wayne Lewchuk, an economics prof at McMaster University who was part of the research team told As It Happens.
"Many of those who continued working were actually able to move to better jobs, jobs that had a higher hourly wage, that had in general better working conditions, that they felt were more secure."
The three-year, $150-million program was scrapped by Ontario's PC government in July. At the time, then-social services minister Lisa MacLeod, said the decision was made because the program was failing to help people become "independent contributors to the economy."
But the report points to a wide range of positives after just one year.
Its findings are the result of a 70-question, anonymous online survey made available to basic income recipients in Hamilton, Brantford and Brant County. A total of 217 former recipients participated, according to the report.
Forty in-depth interviews with participants were also completed in July 2019.
"I remember one individual who said 'Look, I was on the edge of suicide. I just felt nobody cared about me. I didn't know how to make ends meet and now with basic income I feel like I can be part of society,'" Lewchuk recalled.
Nearly 80 per cent of respondents reported better overall health while taking part in the program. More than half said they were using less tobacco and 48 per cent said they were drinking less.
When it came to mental health, 83 per cent of those surveyed described feeling stressed or anxious less often and 81 per cent said they felt more self-confident.
An improved diet, better housing security and less-frequent hospital visits were other outcomes respondents pointed to, along with 66 per cent who said they formed better relationships with family members.
"What became clear is that as people moved to some stability their health improved, their mental health improved, their outlook on life improved," said Lewchuk. "You have to believe that actually made them more employable."
The basic income payments were about 15-20 per cent higher than ODSP, said the professor, but the benefits of people visiting the hospital less often and paying more taxes would offset that cost.
"In terms of the net cost to a province, it's not monumental."
Lewchuk added that while some people did stop working, about half of them headed back to school in hopes of coming back to a better job.
He acknowledged the report's findings are only based on short-term effects but, given the project has been shut down, it's all they have.
"We just don't have the data to understand what happened in the long run. This is the tragedy of the pilot not running for three years."
The society benefited, and with minimal effect on the economy -- people should come first.
quote:As the Trump administration and lawmakers in Washington debate cash payments to support Americans during the coronavirus crisis, the mayor of one California city that has experimented with universal basic income has advice.
Early findings from Stockton, California, which launched a basic income experiment last year, may offer American policymakers some reassurance – and a few notes of caution.
It’s “heartening” to see a national focus on providing direct cash assistance, said Michael Tubbs, Stockon’s 29-year-old mayor, who championed the city’s basic income experiment. But some choices in the current Republican plan make little sense to him, Tubbs said. “If someone was struggling more than others before a crisis, why should they get less help during a crisis that is going to hit them harder? It defies logic,” he said.
On Thursday, the Republican Senate majority leader, Mitch McConnell, proposed legislation to give middle-income Americans a single, $1,200 payout for each adult, plus $500 for each child in a family. The payments decrease for Americans who earn more than $75,000 a year, and individuals who make more than $99,000 will get nothing. The lowest-income Americans also get less: the plan includes a smaller, $600 payment to adults in some of America’s poorest families. Democratic lawmakers are calling for Americans to receive larger, recurring cash payments, with at least one plan calling for a monthly check of between $1,000 and $6,000.
We have to make sure that the most marginalized, the most impacted, the folks who were struggling the most before this pandemic get help
“We have to make sure that the most marginalized, the most impacted, the folks who were struggling the most before this global pandemic get help and relief,” Tubbs said.
Stockton launched its guaranteed income experiment, the first in modern US history, in 2019. Since that February, 125 local residents in the economically challenged city have received $500 a month to spend on whatever they choose.
The idea of providing a universal basic income to citizens is not new, but it has found new supporters in recent years, as some tech industry leaders have embraced “UBI” as a possible response to rising inequality and a growing number of American jobs lost to automation. The Facebook co-founder Chris Hughes is among the proponents of the policy; the Economic Security Project, which he co-chairs, is helping fund basic income experiments in Stockton and elsewhere.
arly data from the Stockton experiment is promising, according to the two researchers who are running the evaluation of the program.
“If you give people free cash, how do they spend it? They’re very rational about it, and they make great decisions,” said Stacia Martin-West, an assistant professor at the University of Tennessee College of Social Work and one of the lead researchers.
Direct cash payments are more flexible than a one-size-fits-all government program, and they allow people to adapt to changing needs and new crises. “Everyone we talked to, there was a different way they would use $500, and they all made sense,” Tubbs, the Stockton mayor, said. “There was no way, as a government official, I would be smart enough to think of all that.”
One participant used the money to pay for dentures, Tubbs said. Another was able to take time off work to interview for a better job that paid more and had shorter hours. Participants have talked about finally having the money to buy their kid a sports uniform or a prom dress, or to move to a safer neighborhood.
But the single largest category of spending among Stockton participants so far: food. Nearly 40% of tracked spending monthly went to feeding the recipients and their families.
Healthier, happier, a little more secure about the future.
This is an answer to the effects of global automatizing of jobs.