Lifting People out of Poverty: The Manitoba Liberal Plan for Jobs & Fair Incomes


August 20, 2019





WINNIPEG - Manitoba Liberal Leader Dougald Lamont announced a major plank in his party’s platform to end decades of neglect and inaction on poverty in Manitoba under the PCs and NDP alike with a series of measures designed to ensure all Manitobans receive a livable income by 2024.


For many years, Manitoba has had some of the deepest poverty in Canada and the number of people on welfare has been rising steadily since 2008 to an all-time high of over 71,000 people. 20% of Manitobans have not seen an increase in their incomes in 40 years.


Many basic income supports have not increased since 1993, when Brian Pallister voted to roll them to 1986 levels. Under the PCs and NDP alike, the social housing allowance stayed frozen at $285 a month for over 20 years. Lamont said the Employment and Income Assistance (EIA) system in Manitoba is sadistic and ineffective because it seeks to punish people out of being poor, whether they are young, seniors, have children, or are disabled.


 “This is a province with enormous opportunities and resources and there is no need for anyone to be living in poverty when there is so much work to be done,” said Lamont. “We have an opportunity and an obligation to end poverty in Manitoba and to provide people with tools and opportunities to lift themselves up.”


In addition to reforming EIA, Manitoba Liberals will introduce three complementary programs to help lift people out of poverty that provides individuals with choice as well as job opportunities:


- A minimum basic income based on a “negative income tax” model, that tops up income 

- Raising minimum wage to $15 within two years of being elected

- A voluntary “Manitoba Works for Good” jobs program that would pay individuals who find themselves out of work with to do jobs in the public interest, as an alternative to EIA or basic income


Liberals say there is abundant evidence showing that these measures will not just hugely improve lives, but benefit the economy.  


“It’s time to put an end to the failed 40-year experiment in trickle-down economics that both the NDP and PCs have pursued and invest in grassroots economic growth,” said Lamont. “We’re all better off when we’re all better off, and this plan gives people dignity and opportunity they have been denied for years.” 


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Backgrounder 


Livable Incomes and Basic Income Project 


The Manitoba Liberal Party intends to implement the minimum basic income plan for all Manitobans.   


Certain aspects of the plan – implementation in First Nation communities for example – will be negotiated in partnership with the federal government and First Nation’s leaders.  

The evidence from the Dauphin experience, under the Federal Liberal Government of Pierre Trudeau, shows this plan will give greater individual choice and will improve the education and the health and health care of Manitobans.   


It is also expected, based on the findings in Dauphin, that this minimum basic income approach will, by providing basic minimum income support and job opportunities,


- decrease the extent of mental illness

- decrease crime and addictions in Manitoba

- make it easier for individuals to transition to work or to starting a business


By providing three choices for individuals, this plan will give greater individual choice and greater individual opportunity as well as enhance the ability of individuals to find employment.  The dollars provided in support for those who are in poverty will help more people to achieve success and move above the poverty line. These provisions will help individuals and families. The costs for implementing this program will not be large because the amount being provided to individuals is the same as is currently provided, it is being given in a way that will give individuals more options to stay healthy, to stabilize and improve their lives and to advance their careers. There may be slight savings in that fewer staff will be needed for the support of individuals receiving a minimum basic income.  


One of the most important benefits of the Manitoba Liberal Party basic income system is that it will allow people to take control of their own lives instead of having decisions dictated to them.  We support people and families. Under the Minimum Basic Income, people can make decisions which are in their best long-term interests instead of having to choose based on the short term thinking which is often forced upon them by those running the EIA program. The Minimum Basic Income will also lift the welfare wall – the barriers that exist for people on social assistance who want to start earning money and to get off income assistance.  No longer will people who earn a few hundred dollars have 70% of it clawed back and taken away from them. Under the Manitoba Liberal minimum basic income system, they will be treated like all other taxpayers instead of being taxed at this extraordinary high level.  As Evelyn Forget says, “We all benefit from a basic income in the form of a more stable, prosperous and inclusive society, whether or not we receive a stipend.” 

1) Staying on the current support system: Some individuals currently receiving EIA (Employment and Income Assistance) may choose to stay with the current system which they know.  This could apply, for example, for some adults with intellectual disabilities.  It could apply to some who know and appreciate the current system.   The opportunity to stay on the current system will allow a more gradual transition to the minimum basic income, rather than an abrupt changeover.  It will also allow the current system to be a backup should there be difficulties in the transition for some.  To avoid the problems which have occurred under NDP and PC governments of no increase in the amount individuals receive over time, the overall support under this program will be increased annually at the rate of inflation.


2) A minimum basic income:  Individuals who choose a minimum basic income will receive the same total income as they presently receive, but they will receive it without any of the current requirements to be searching for a job or to have sold off assets.  Anyone whose income is below the minimum basic income will be eligible for a top up to achieve the minimum basic income.  To receive the minimum basic income, they will be required to file a tax return, to have a bank account and to be a resident in Manitoba for 1 year.   The amount received will increase annually at the rate of inflation.  In recognition that those on a minimum basic income will need to receive some supports currently received by those on our current system, a sliding scale for such supports (medications, bus passes are examples) will be implemented based on income level.  The minimum basic income is not intended to replace current income supports (Old Age Security for example), but rather to fill in gaps so that every Manitoban can have a minimum basic income.  The minimum basic income will be unconditional, so that people are free to decide how to use their time. This reduces the need for a costly and intrusive bureaucracy to ensure that people comply with an extensive list of regulations.


3) Manitoba Works for Good Program: This program is modelled after the Works Progress Administration (WPA) program under Franklin Roosevelt, and discussed in modern form by L. Randall Wray and others. It makes productive use of people who are unemployed, as an alternative to EI or to EIA. People are paid to do work in the public interest, which can take many forms and is a reflection of the principle that there is a right to work. They could either work directly for government or for an approved non-profit. A job guarantee program hires people who otherwise cannot find employment. Once implemented, a job guarantee would be a permanent program, operating during good times and recessions alike.


4) Livable Wages for All: Part of ensuring that all Manitobans earn a livable wage is by raising to minimum wage to a livable one. Manitoba Liberals will increase the minimum wage to $15 in two years and keep it going to the rate of inflation. 

Manitoba Works Program 

The Manitoba Works Program is a critical component of the Manitoba Liberal Party basic minimum income program because it will provide the certainty of a job and the certainty of gaining the skills and experience to get back into the labour market.  Such employment is known to protect individuals against depression and to reduce psychological stress – and will be an important factor in improving mental health.  The overall impact of this program can be expected to result in fewer children in poverty and fewer children being taken into the care of child and family services.  This will mean happier families and a happier society.  It will also mean that provincial costs in certain areas – child and family services, health care and justice will be less (or will not grow as fast) as the demand for these services will be reduced.  

One of the most important benefits of the Manitoba Liberal Party basic income system is that it will allow people to take control of their own lives instead of having decisions dictated to them.   We support people and families.  Under the Minimum Basic Income people can make decisions which are in their best long-term interests instead of having to choose based on the short term thinking which is often forced upon them by those running the EIA program. The Minimum Basic Income will also lift the welfare wall – the barriers that exist for people on social assistance who want to start earning money and to get off income assistance.  No longer will people who earn a few hundred dollars have 70% of it clawed back and taken away from them.  Under the Manitoba Liberal minimum basic income system they will be treated like all other taxpayers instead of being taxed at this extraordinary high level.  


Cost of Program  

There were 70,000 people receiving EIA from the province of Manitoba in 2017/18 at a cost of $600 million annually. On top of that, there are approximately 139,000 adult Manitobans who live in poverty. The Parliamentary Budget Officer estimates the cost of a basic income at $9,598 per capita.

 

The Basic Income Project would cost approximately 1.3 billion to cover all Manitobans experiencing poverty, this would remove a lot of costs from the former EIA program, as well as reducing costs across Child and Family services, Justice, Education and Health Care. There are also the reduced use of EIA under a $15 minimum wage. 


There is also a need to calculate the return on investment. While higher income individuals would save or invest, lower income people spend new income directly back into our local economy. 

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