Sponsored by Pierre Trudeau
Between 1974 and 1979, residents of a small Manitoba city were selected to be subjects in a project that ensured basic annual incomes for everyone. For five years, monthly cheques were delivered to the poorest residents of Dauphin, Man. – no strings attached. And for five years, poverty was completely eliminated.
The program was dubbed “Mincome” – a neologism of “minimum income” – and it was the first of its kind in North America. It stood out from similar American projects at the time because it didn’t shut out seniors and the disabled from qualification.
The project’s original intent was to evaluate if giving cheques to the working poor, enough to top-up their incomes to a living wage, would kill people’s motivation to work. It didn’t.
But the Conservative government that took power provincially in 1977 – and federally in 1979 – had no interest in implementing the project more widely. Researchers were told to pack up the project’s records into 1,800 boxes and place them in storage.
Why Dauphin? How did a farming community play host to such a landmark social assistance program?
Good political timing didn’t hurt.
In 1969, the left-leaning provincial NDP led by Edward Schreyer swept into power for the first time. The transition injected new rural sensitivities and democratic socialist influences into politics.
On the federal level, Pierre Elliott Trudeau was prime minister. The two men worked swiftly to set up conditions for a basic income experiment.
In 1973, Manitoba and the federal government signed a cost-sharing agreement: 75 per cent of the $17-million budget would be paid for by the feds; the rest by the province.
The project rolled out the next year.
All Dauphinites were automatically considered for benefits. One-third of residents qualified for Mincome cheques.
How Mincome cheques were calculated:
- Everyone was given the same base amount: 60 per cent of Statistics Canada’s low-income cut-off. The cut-off varied, depending on family size and where they lived. But in 1975, a single Canadian who was considered low-income earned $3,386 on average.
|Family of two||$4,907||$20,443|
- Base amount was modified: 50 cents wassubtracted from every dollar earned from other income sources
“It was sort of something new and utopian. It was completely different,” said Dauphin’s current mayor Eric Irwin. “It was an attempt to define social services in a different way.”
In 2011, Forget released a paper distilling how Mincome affected people’s health using census data. She found overall hospitalization rates (for accidents, injuries, and mental health diagnoses) dropped in the group who received basic income supplements.
By giving a community’s poorest residents enough to lift their incomes above the poverty line, there was a measurable impact on the health care system. It’s this kind of logic that Forget hopes will propel the idea of basic income forward, four decades later.
“I’m enough of an optimist to believe that eventually we’re going to end up there. I think we already have part of the program in place,” said Forget, referring to existing supplements including the Guaranteed Income Supplement for seniors and the National Child Benefit.
“The one gap in the system right now is the working poor: people working in insecure and precarious jobs.”
A ‘classic Ottawa initiative’
“Canada’s welfare system is a box with a tight lid. Those in need must essentially first become destitute before they qualify for temporary assistance,” said TD Bank’s former chief economist Don Drummond after the social agency’s report was released in 2010.
“But the record shows once you become destitute you tend to stay in that state. You have no means to absorb setbacks in income or unexpected costs. You can’t afford to move to where jobs might be or upgrade your skills.”
Former Conservative senator Hugh Segal is a longtime proponent of a guaranteed annual income policy. He believes the program could save provinces millions in social assistance spending on programs like welfare.
Instead of being forced through the welfare system, people’s eligibility would be assessed and reassessed with every income tax filing. Those who don’t make above the low-income cut-off in their area would be automatically topped up, similar to Mincome in Dauphin.
Currents changing in Canada
During his nine years in the Senate, Segal advocated strongly for basic income for Canadians. But in his time as a member of the Conservative caucus, he “didn’t see the tiniest indication of interest on the part of the government” in another test site or implementation.
That’s because the current government shares the Mulroney administration view that “the best social policy is a job,” he said.
The one exception was late finance minister Jim Flaherty who established the working income tax benefit to aid working Canadians living in poverty. He was the only one to engage constructively, Segal says.
Segal said he doesn’t expect the concept to gain traction again among the Harper Conservatives.
“I would think it’s fair to say ideologically, the present government would eye the notion that this is some ‘kooky left-wing scheme’ without addressing the fact that really strong social and economic conservatives like Milton Friedman argued in favour of a negative income tax,” he said.
In Canada, the idea of an universal basic income was first presented at a Progressive Conservative policy convention in October of 1969. Then-leader Robert Stanfield argued the idea would consolidate overlapping security programs and reduce bureaucracy.
But in the last two elections, Segal says poverty did not come up in television debates between party leaders once. It’s something he doesn’t want to see repeated.
“I think it’s an abomination that we wouldn’t discuss it when we have close to 10 per cent of the population living beneath the poverty line.”
Yet he remains more optimistic in this decade than the last because of signs of interest from the federal Liberal and Green parties.
“One begins to sense, not that the ice is breaking, but the currents underneath the ice are beginning to move more quickly,” he said.