Seniors and Basic Income Guarantee
Editor’s note: The P.E.I. Working Group for a Livable Income, in urging the provincial government to pursue a partnership with the federal government to establish a universal basic income pilot project in P.E.I., has written a four-part op-ed series on a Basic Income Guarantee and some of the potential impacts for Islanders. This is the third part in the series, this one written by Marie Burge represents Cooper Institute in the PEI Working Group for a Livable Income. The P.E.I. Working Group for a Livable Income (WGLI) is the community based group which is advocating for a pilot program of Basic Income Guarantee (BIG) in P.E.I. Over the past four years the Working Group has researched the experience of other jurisdictions where basic income programs are in place.
After many meetings with Island communities and dialogue with P.E.I. policymakers, we have a picture of how BIG might work in P.E.I. One thing was clear in our meetings with Islanders: that BIG should be universal in that all Islanders 18 years and older would be guaranteed an income which would cover their basic needs (housing, utilities, food, clothing, medications, transportation, child/elder care, modest recreation, and occasional emergencies). When it comes to seniors, there are added living costs such as snow removal, grass cutting, mobility devices. Seniors tend also to think of their end of life and do not want funeral costs left to their relatives.
Some Federal Programs Models of BIG
Currently Old Age Security (OAS) and Guaranteed Income Supplement (GIS) indicate the federal government has already embraced the basic Income guarantee model as does the Canada Child Benefit.
OAS is in the same category as a number of Basic Income Guarantee “universal” programs which are in practice in different parts of the world. This concept of universal means that everybody regardless of income is a beneficiary. High income people are taxed back above an agreed threshold. The model of BIG that P.E.I. Working Group for a Livable Income is proposing for the Island is the one that is paid out only to those who are below an identified income.
Both the seniors’ GIS and the Canada Child Benefit programs are administered through the federal tax system. This is the administration structure that the Working Group proposes for BIG.
Beneficiaries are identified by their income tax return. These programs are now functioning well as federal government programs. This should encourage P.E.I. to proceed in its dialogue with the federal government with the aim of setting up a Basic Income Guarantee pilot here.
Seniors: Potential Beneficiaries of BIG
Old Age Security is around $578 per month, well below what is required to cover basic needs. There are many who, because of their inadequate income in younger years or lack of workplace pensions, have insufficient income in their senior years. These seniors are eligible to receive the Guaranteed Income Supplement. More than one-third of Island seniors are receiving GIS to supplement their Old Age Security. The maximum amount receivable with the GIS is $17,311, not a livable income. In December 2016 there were 10,031 seniors receiving GIS.
Therefore this many Island seniors are in a low-income bracket. Given that women tend to outlive men, we assume that many low-income seniors are women living alone. Living alone is expensive.
Some would want to stay in their own home, which may not be an option.
We would expect BIG to ensure that seniors have all their living needs met.
Another way that might work as the provincial government enters its collaboration dialogue with the federal government is: leave the OAS and GIS in place and increase GIS to meet livable income standards.
The other option would be to rely on BIG as a top-up.