CanadaGuaranteed Basic Incomehelps alleviate poverty, but jeopardizes financial sustainability and labor supply in some states A new study published Thursday said it could be.
Halifax-based economic think tankAtlantic Canada Economic Councilreports that by providing people with monthly checks, everyone can It is said that it will be possible to secure enough money to meet the essential needs. Includes food, housing and clothing.
Studies have found that income support will reduce inequality, establish a sense of financial stability and promote savings.
Still, the basic income program—whether needs-based or universal, the amount paid to high-income earners collected through taxes will be more complex than it looks. The report states.
Read more: Basic income programs could cut the country's poverty rate in half, PBO says
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Funding the program is likely to require tax increases or cuts in government spending, he said. rice field.
“One of the biggest risks is how this program will be funded in the long run,” said Lana Asaff, Senior Economist at APEC. "It's pretty expensive."
A parliamentary budget officer reports that the country's guaranteed base income between 2022 and 2023 is estimated to be about $ 88 billion.
Asaph said that certain groups of society are at risk of deterioration if social programs are reduced to support payment of basic income.
She added that risk in some areas, such as Atlantic Canada, could also be exacerbated.
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On the other hand, when income is guaranteed, motivation to work is lost and the existing labor shortage worsens. There is likely to be.
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"There are concerns that people may be discouraged from working," Asaff said. “This can be a challenge, especially in the low-wage industry. There are many labor shortages in this industry.”
No programs have been tested
The idea of a guaranteed basic income program attracted new attention during the pandemic.
The development of the Canadian Economic Recovery Benefit (CERB) and other pandemic benefits have spurred discussions on the adequacy of our social safety net.
In December 2021, Senator Kim Pate and Rep. Leah Gazan submitted a bill aimed at creating a national framework for "guaranteeing a habitable base income." Said the APEC report.
"Basic income is a concept that has been around for some time, but it's becoming a more mainstream topic," says Asaff. "The program has potential strengths and weaknesses, but some are theoretical in nature."
Read more:Nova Scotia's "low-wage economy" and its impact on people
Non-basic income programs are currently being tested in Canada.
2018, B.C. The government commissioned a panel of experts to investigate basic income, such as the feasibility of the program and the potential for poverty reduction.
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The transition to basic income is a complex endeavor and is not necessarily the most cost-effective way to reach poverty goals. It turned out not to be the way.
Ontario launched a three-year Basic Income Pilot Project in 2017, but was canceled before it was completed after a change in state government.
The APEC Commission stated that income support for specific groups could be a better alternative.
This report by Canadian Press was first published on June 16, 2022.
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