The PBO estimates a Basic Income for the last six months of the 2020-21 fiscal year would cost $47.5 billion to $98 billion depending on the setup. The funding would provide a guaranteed annual income of $18,329 and $25,921 to individuals and couples, respectively. The PBO found approximately $15 billion could be saved in administration costs through combining similar existing social programs. The savings could theoretically be used to offset the cost of implementing Basic Income.
The range in the PBO's estimated cost of Basic Income comes from
varying the reduction rates at 50 percent, 25 percent, and 15 percent.
The reduction rate is the percentage of the benefit that is reduced in
relation to earned income. For every dollar in wages, a recipient’s
benefit is reduced by between 50 and 15 cents, depending on the setup.
At the low end, the PBO estimates the cost of Basic Income would be $47.5 billion at a 50 percent reduction rate. This means a person would have to earn $36,660 to no longer be eligible for Basic Income payments. At the highest cost, more than 20 million Canadians would be eligible for Basic Income at a 15 percent reduction rate, increasing program costs to $98 billion per year. A person would have to earn more than $122,000 before benefits are eliminated at this rate.
What do you think?
Is Basic Income more cost efficient than CERB?
What Reduction Rate is best?
Should Basic Income replace CERB?
At the low end, the PBO estimates the cost of Basic Income would be $47.5 billion at a 50 percent reduction rate. This means a person would have to earn $36,660 to no longer be eligible for Basic Income payments. At the highest cost, more than 20 million Canadians would be eligible for Basic Income at a 15 percent reduction rate, increasing program costs to $98 billion per year. A person would have to earn more than $122,000 before benefits are eliminated at this rate.
What do you think?
Is Basic Income more cost efficient than CERB?
What Reduction Rate is best?
Should Basic Income replace CERB?