Canada's Prime Minister Justin Trudeau attends a news conference, in Ottawa, Ontario. (REUTERS)
Canada's Prime Minister Justin Trudeau attends a news conference, in Ottawa, Ontario. (REUTERS)

Canada likely to give nod to universal basic income programme

Trudeau government is already paying 2,000 Canadian dollars per four-week period to those rendered unemployed or underemployed during the Covid-19 pandemic
By Anirudh Bhattacharyya I Edited by Amit Chanda
UPDATED ON APR 18, 2021 07:05 PM IST

The idea of instituting a universal basic income or UBI programme is gaining ground in Canada ahead of the budget to be presented by the government on Monday.

The budget will be first during the second term of the Liberal Party government led by Prime Minister Justin Trudeau since coming to power after the October 2019 federal elections.

It will also be the first to be presented by deputy prime minister Chrystia Freeland, who assumed charge of the finance portfolio following the resignation of her predecessor Bill Morneau last year.

Importantly, the Liberal Party passed a resolution supporting UBI during its national convention in the second week of April. The resolution was supported by 77% of party members who sought to “ensure that communities at risk (including indigenous people) are able to feel financially secure,” according to CBC News.

The New Democratic Party convention also adopted a similar motion earlier this month.

That momentum for UBI came as the Trudeau government already implemented the Canada Emergency Response Benefit (CERB) in March last year that paid out 2,000 Canadian dollars (US$1,599) per four-week period to those rendered unemployed or underemployed during the Covid-19 pandemic. That was later converted into the ongoing Canada Recovery Benefit (CRB).

Experts believe a start could be made in the budget by studying various aspects of a UBI scheme. “I think you might see some funding in the budget for studying a basic income or maybe doing some pilots of a basic income,” professor Dionne Pohler, acting director of the University of Toronto’s Centre for Industrial Relations and Human Resources, said.

However, she did not consider the CERB or CRB as having laid the groundwork towards UBI as they were forms of employment insurance. But, they may have change public perception of UBI, making more politically palatable. As she said in the past, the idea someone was poor was attributed to “character flaw or a moral failure or they’re just not working hard enough”. And, so I think that what Covid did for the public was make them realise, “You know this could happen to anyone losing their job and at what would you do if you didn’t have access to income?”

Pohler believes a targeted basic income programme would be more viable in terms of cost and equity, with those making below a threshold income receiving a cash transfer which would be phased out as the beneficiaries’ income rose.

Groups are also lobbying for a version of UBI given the current conditions of uncertainty caused by the coronavirus crisis. The Ottawa-based Basic Income Network has argued for an “architecture” for those in the 18 to 64 age bracket to “be put in place as soon as possible in order that everyone in Canada can contribute to, and benefit from, a healthier new normal”.

The biggest roadblock could be the cost involved. The Trudeau government has already taken the federal deficit to nearly 382 billion Canadian dollars (US$306 bilion) by late March, according to an estimate by Parliamentary Budget Officer Yves Giroux.

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