The concept of universal basic income may appear at best utopian and naïve, at worst too socialist and costly. For some, at the very least it seems utterly new and unattainable. But before any Canadian rejects basic income for these reasons, let’s look at just one Canadian program of grants that has been in place for more than half a century.
On July 20, 2016, Canadian families with children aged 17 and under will receive benefit payments under the newest child benefit plan. The history of such benefits reaches back to July 1945. On that date the Family Allowance Act of 1944 (known more commonly as the Baby Bonus) was implemented. The federal government provided a universal grant to all Canadians who had children under the age of 16. Then, as now, income from these benefits was not taxable. In the 71 years since the first Baby Bonus grants were received, the plan has gone through a number of major changes.
The first change to Family Allowance was made almost 30 years after implementation. Starting in 1973, Family Allowance was considered taxable income. The universality of the program remained, in that everyone with children received the benefit, but increased income reduced the benefit.
Universality was challenged and eliminated after almost 50 years, when in 1992 the Family Allowance system was ended and the new Child Tax Benefit was introduced .The name was changed to Canada Child Tax Benefit (CCTB) in 1998. The new benefit, paying a maximum of $85 per month per child was tax free but income tested on the basis of net family income as reported in the preceding year’s tax return.
In 2006 the federal government introduced the Universal Child Care Benefit (UCCB). Taxation of this benefit was cumbersome and complicated. Families of different make-up but with the same income got different amounts of after-tax benefits.
Now both CCTB and UCCB have been replaced with the new Canada Child Benefit (CCB).
For families with less than $30,000 in annual net income, the following are maximum yearly CCB benefits:
- $6400 per child under age 6
- $5400 per child aged 6 through 17
Families with higher incomes receive progressively less, until the CCB phases out completely for the wealthiest households.
As can be seen by even this short history of child benefits, the search to find an appropriate, equitable and just program has been long and messy, but that has not stopped the effort.
Basic income is not simple, and it is not utopian, naïve, too socialist or too costly.
Every Canadian child since 1945 has participated in at least this one basic income plan. Now let’s expand it to include all Canadians no matter what age.