Basic Income NL*
Basic income is an opportunity to rebalance our province’s social and economic models, which leave thousands of people behind. Nobody in Newfoundland and Labrador should be forced to choose between vital medical care, heating their home, or having enough food to eat. There are many complex issues that Newfoundlanders and Labradorians face, and a basic income is not a solution for all of them - but largely eliminating poverty in this province would certainly be a good start. That is what a basic income would do.
What Is a Basic Income?
The Basics
Basic income provides cash transfers from the government to people so everyone can afford their basic needs.
The value of these cash transfers is usually an amount that increases a recipient’s income to the poverty line.
Studies have shown that a Basic Income not only keeps people out of poverty but also allows them to pursue further educational and employment goals.
How It Works
One prominent basic income model is based on a Refundable Tax Credit (RTC), which provides income to everyone.
Using the RTC model, the Basic Income provided to a person would be refunded if their income exceeded the threshold.
If implemented, this model would replace our current Income Support system and dramatically reduce the cost of poverty.
Basic Income Helps Everyone
A Basic Income would ensure that everyone can meet their basic needs, regardless of their ability to work.
When we prioritize the needs of our most vulnerable, we pave the way for a just and equitable society.
Implementing Basic Income will not cost more for the government or taxpayers.
Frequently Asked Questions
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The main reasons why people stop working when they receive a Basic Income is to stay home to care for very young children or to continue schooling.
A Basic Income allows people to pursue work they find meaningful, but without a notable impact on labour supply.
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Studies have found that an increase in transfer payments from the government does not impact work behaviour. People will still take entry-level jobs to gain experience.
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In short — yes, we can afford it.
Basic Income NL looked at the costs for different Basic Income options in our province. The model proposed in the Basic Income Policy Paper would cost less than what the province spend on Income Support.
Importantly, a Basic Income has the potential to eliminate poverty. This would lead to significant savings in healthcare, the justice system, forgone tax revenue, etc.
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There is a common fear that people who receive basic income will misspend their money on drugs, alcohol, entertainment, and other “unnecessary” things.
However, studies have found that very few people who receive cash transfers (e.g. a Basic Income) spend those funds on “temptation goods.” They are much more likely to spend their money on basic needs and things that help them reach their educational and employment goals.
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Some advocates have voiced concern that a Basic Income would give employers an unfair opportunity to reduce pay rates for low-wage workers.
This has not been seen in any Basic Income pilot programs so far. A Living Wage would complement a Basic Income, and minimum wage laws are key to making sure that all workers are treated fairly.
It’s important to remember that a higher minimum wage is critically important but does not reach everybody. There are lots of people who cannot work for a variety of reasons or who work in a way that is not impacted by minimum wage.
*Basic Income NL is the original owner and creator of this content.
Basic Income NL included:
Choices for Youth, Food First NL, Provincial Advisory Council for the Status of Women, Fishing for Success, Social Justice Co-operative NL, Stella’s Circle, End Homelessness St. John’s, Community Sector Council NL, Empower, the Disability Resource Centre, First Light, Transition House Association of Newfoundland and Labrador.