The Ontario Basic Income Pilot Shows the Real World Problems with a Basic Income

Part 4 in a series. Part 1 examines the impact of the PBO Basic Income plan on disabled Canadians. Part 2 shows the real-world harms when the Basic Income cheque-for-cuts playbook is used in practice. Part 3 looks at how a “cruelty-free” Basic Income could be designed.

TL;DR: The Ontario Basic Income Pilot under former Premier Wynne illustrates what a “real world” implementation of a Basic Income, designed under real-world financial and political constraints, would look like. In short, it would make the lives of many of the most marginalized and vulnerable citizens worse, particularly if they have a disability or a medical condition such as diabetes.

*Sigh*

This is the piece I really didn’t want to write. Given the numerous list of failings of the current Ontario government, there really isn’t much to be gained by beating up on the previous Ontario government, particularly when voters already made their displeasure clear at the ballot box, giving the Ontario Liberal Party their worst results since Confederation.

Given the talk that the Federal government (led by a federal Liberal party) may consider transforming COVID-19 economic supports into a permanent Basic Income program, I feel it is vital to go back and review how the Wynne Basic Income program pilot was designed, as it is likely to inform any federal government Basic Income design.

Because of the need to keep costs reasonable (a pressure that any government will deal with), and the goal of streamlining support programs to reduce administrative costs and to find efficiencies (a stated goal of many Basic Income proponents), the Ontario BI pilot used a cheque-for-cuts model, where participants in the program would get larger monthly cheques in exchange for losing a system of supports.

The Income Security Advocacy Centre has a fantastic guide on how the program worked. I’ll be taking excerpts from their guide, but I do recommend reading the whole thing.

In short, the pilot had two groups: A few thousand people who would receive the Basic Income but lose most of their Ontario Works (OW) or Ontario Disability Support Program (ODSP) benefits, and a control group that would not receive a Basic Income and continue to receive their existing OW/ODSP benefits.

Enrollment into the program was completely voluntary. This is vital to understand. The enrollees in both groups were not a random subset of OW/ODSP recipients, but rather were people who self-selected to participate and did not reflect the OW/ODSP population as a whole.

Under the pilot, Basic Income recipients lost the cash portion of OW/ODSP (along with EI and CPP, if they were collecting those), but received a BI amount that was significantly higher than OW/ODSP. For persons with disabilities, it could be almost $800 a month higher.

Sounds like a fantastic deal. And for many on OW/ODSP, it was. However, they also had to give up all of their other OW/ODSP benefits, with the exception of drug benefits for OW and ODSP recipients, and dental benefits for ODSP recipients. These benefits included the following:

It’s important to note what each of these do. I’ll describe them as briefly as possible.

The Special Diet Allowance is a program that provides up to $250/month “to assist with the cost of a special diet for a medical condition”. For instance, someone with celiac disease receives $97/month to account for the fact that the costs of gluten-free food are higher. I have celiac disease, so I can speak to this lived reality; last time I was at a grocery store in downtown Ottawa, the only loaf of gluten-free bread was $8 a loaf, for 13 slices.

Evelyn Forget, in her book, Basic Income for Canadians, argues that these programs are unnecessary, on the following grounds:

Everyone needs to eat, and all of us, not just people with diabetes or other conditions, require healthy food. Everyone, therefore, should have the capacity to buy a healthy diet, and there is no good reason to have a separate program with different eligibility and oversight requirements to manage it.

This completely misses the point and shows how out of touch the BI movement is of the lived reality of people with disabilities. Yes, we all require healthy food, but the costs of healthy diet can and do vary enormously based on a person’s medical condition. Not everyone’s loaf of bread costs $8.

That said, even if a person on ODSP were collecting $250/month from this benefit, they’d still be ahead by taking the Basic Income. But instead of the difference being just under $800/month, it would be just under $550/month. So BI is still generous, but less so than it appears at first glance.

Of course, that’s before we account for the other cuts.

Remote communities allowance: “Where the recipient lives north of the 50th parallel and is without year-round road access, an additional amount is provided as follows”:

Mandatory Special Necessities: “The costs of the following items can be covered for members of the benefit unit as Mandatory Special Necessities (MSN) if not otherwise covered or reimbursed: Diabetic supplies; Surgical supplies and dressings; and transportation reasonably required for medical treatment, if the cost of that transportation in the month exceeds $15.”

For many people on OW/ODSP, this benefit has little-to-no value. For others, particularly those that require transportation, the value of those benefits are substantial.

Vision benefits: “All eligible persons may receive new lenses and frames every 3 years, when necessary. For children, assistance with the cost of new lenses may be provided anytime there is a change in prescription. All members of the benefit unit are entitled to coverage of routine eye examinations once every 24 months where not covered by OHIP.”

Hearing Aid Benefit: “[Provides] assistance to ODSP recipients and eligible dependants with the purchase of hearing aids and hearing related items and services… The Hearing Aid Benefit also covers the cost of Alerting Systems for ODSP recipients and eligible members of the benefit unit who are deaf and hearing impaired.”

Guide Dog Benefit: “Each member of the benefit unit who has a specially trained dog certified for use as a guide, hearing or service dog by an accredited training facility is eligible for an amount of $84 per month to assist with the costs for the routine care of the dog.”

Assistive Devices Co-Payment Coverage: “[Provides] coverage to ODSP benefit unit members for assessment fees and the consumer co-payment for the Ministry of Health and Long-Term Care’s Assistive Devices Program (ADP).”

Employment Supports: “[T]here are many kinds of Ontario Disability Support Program Employment Supports. Here are some examples: help preparing for work, help finding a job that is right for you, help keeping a job, job coaching, on-the-job training, help to move to the next level in your career, software and mobility devices that can help you do your job, interpreter or intervenor services, transportation assistance, assistive devices and training to use them, tools and equipment you need for your job, special clothing for your job, specialized computer training, other items you may need.”

Up-Front Child Care Costs: “Eligible members of the benefit unit may receive financial assistance with upfront child care costs that are reasonably necessary and, in the opinion of the Director, the eligible member is required to pay in advance to allow the person to: Begin, change or maintain employment, Begin, change or maintain an employment assistance activity under the Ontario Works Act or Begin, change or maintain any other activity intended to assist the person to become and stay employed that is approved by the Director.”

That’s a whole lot of information, but the basic take-away is this: These programs that were taken away were for specific special needs. If you didn’t need them or weren’t using them, then a Basic Income could substantially increase your wellbeing, as the BI gave you more money than ODSP/OW. If you were a “high-use” beneficiary of these programs (say someone with substantial medical-related travel expenses), then enrolling in the BI would make you substantially worse off.

“Does a Basic Income make persons with disabilities better off” is the wrong question to ask, because it ignores the spectrum of needs and experiences of persons with disabilities. Like the Ford Ontario Autism Program, a Basic Income that is funded through eliminating existing programs is a resource transfer from high-needs to low-needs individuals, leaving the most vulnerable worse off.”

At this point in any ODSP/OW discussion, someone will invariably point out that while these programs sound good on paper, they’re terrible (and underfunded) in practice. To that I say:

I AGREE

These programs can be downright cruel and oppressive. And guess what? They’re still can be better than a basic income; that’s how badly a BI can fail those with disabilities. It’s why groups like the Ontario Coalition Against Poverty are opposed to a Basic Income, and the ODSP Action Coalition, who are on the front lines of these battles, have reservations about Basic Income:

You would think that when the people fighting the horrible status-quo look at a Basic Income and say, “you know, we’re not convinced that would be better”, that would be a wake-up call. You’d also think that we’d find some other way to fund a basic income than taking the food allowance away from a vision-impaired child’s guide dog, yet here we are.

Anyhow, swapping ODSP for a Basic Income was a bad deal for a whole lot of persons with disabilities, so not surprisingly few made the switch. Here’s a brief history of the enrollment process, from a Maytree report by Michael Mendelson:

According to Greg Mason, an academic who was engaged to assist in the early design of the project: “Ontario started mailing invitations in June 2017 and by September, after mailing 37,000 invitations it had managed to enrol barely 150 participants, well short of the original target of 2,000” (Mason 2018). There are likely many contributing factors to this failure; the prevalence of “scam” offers that are difficult to authenticate; a profusion of legalistic language insisted upon by lawyers; complexity and difficulty in filling out the form; and the requirement to allow access to tax information. Under-enrollment should have been anticipated because a phenomenon across many wealthy western countries is that the so-called working poor are reluctant to register for programs that require a declaration of poverty or need: a take-up rate of 30 percent is not unusual, but a rate of under a half of one percent is a singular achievement.

Due to the continuing difficulty of recruiting participants, the OBIP revised its enrollment process. Local organizations were engaged to set up group meetings of households likely to be eligible for OBIP benefits. The OBIP was explained at the meetings, and questions were answered; those wishing to enroll could complete an application on the spot with assistance from staff. There are no official data on the number and location of households that were recruited by the time of the experiment’s cancellation, but even if the overall target numbers were fully reached, the recruitment method meant that the OBIP was no longer a randomized study.

In short, when the invitation method failed (BI supporters typically explain this by the letters looking ‘scammy’ — they’re probably right), the Ontario government got local organizations to find people who would be a good fit for the program and recruited them to enroll. What this meant in practical terms were that the people in the pilot were “cherry-picked” to be ones that would be particularly helped by a BI, and people who would be harmed by a BI were not enrolled. That’s not a criticism of those local groups or the OBIP; it would be highly unethical to trick people into enrolling in a program that would harm them.

What the BI pilot was testing was not if the entire population of marginalized and vulnerable Ontarians would be helped by a Basic Income, but rather that the subset of people we believe would be helped by a Basic Income were, in fact, helped by a Basic Income.

And we have no idea how many persons with disabilities saw the details of the Basic Income pilot, concluded “this would make me worse off” and didn’t enroll, because the government never bothered to collect this data!

We cannot draw any conclusions from this pilot about what a Basic Income would mean if instituted population-wide, for two reasons:

  1. The persons in the pilot were cherry-picked to exclude those that would be harmed by a basic income.
  2. There was no saturation site, so the pilot didn’t test what would happen to, say, rents if the population as a whole were eligible for a BI. Would the increased dollars simply be captured by landlords as more dollars are now chasing the same (limited) number of places to rent?

We need to keep those limitations in mind when reading reports about studying the impact of the pilot. There’s been some fantastic work done in the aftermath of the pilot, including the McMaster study Southern Ontario’s Basic Income Experience which found that people in the Basic Income pilot did have an increase in the quality of their lives. But given that the sample of people in the pilot was cherry-picked, should we really be surprised at these results?

That’s enough on this for now. In summary:

  1. The Ontario Basic Income pilot shows what a real-world Basic Income, under real-world financial and political constraints, would look like.
  2. What it looks like? A disaster for a lot of people with disabilities, transferring resources from high-needs to low-needs individuals.
  3. You would think that when the people fighting the horrible status-quo look at a Basic Income and say, “you know, we’re not convinced that would be better”, that would be a wake-up call. You’d also think that we’d find some other way to fund a basic income than taking the food allowance away from a vision-impaired child’s guide dog, yet here we are.
  4. A cherry-picked (out of necessity) sample and the lack of a saturation site limits the conclusions we can draw from the experiences of people on the pilot.
  5. Given how entrenched people’s opinions are on Basic Income, this likely won’t change anyone’s views whatsoever.

Though maybe I shouldn’t be so pessimistic on number 5. Over the summer, cracks seem to be showing in the cheques-for-cuts Basic Income consensus. I’ll explore that in my next piece.

Senior Director, Smart Prosperity. Assistant Prof, Ivey Business School. Exhausted but happy Dad of 2 wonderful kids with autism. I used to do other stuff.