Thank you, Mr. Speaker. The current system of income assistance in the NWT is not working. It is complex, intrusive and inefficient, and too many dollars are being used up to administer a system that does too little to lift people out of poverty.
In 2013, income support payments of $16 million cost almost $4 million to deliver. Twenty percent of the dollars available went to administration. Given these shortcomings, another approach is needed.
Currently, before a person qualifies for income assistance they must be destitute. All of their assets, right down to their retirement savings and vehicle must be gone. Recipients must report regularly to a case worker and continuously justify their need. The system saps an incredible amount of time and resources and keeps people in their poverty traps.
If an income assistance client finds a part-time job or some other income, it is clawed back, removing some of the incentive to work at least. Contrast this with what many economists, on both the right and left of the political spectrum, feel is a less expensive option with greater positive outcomes, a guaranteed basic income.
This system automatically tops up the incomes of people living in poverty using direct automatic payments through the existing tax system while allowing them to keep the productive assets needed to get off and stay off social assistance. There is no need for an expensive bureaucracy to oversee the system, no need for applications and no need for monitoring. This system encourages people to find work by giving them the security of
an income guarantee without the fear of being worse off by working.
A pilot project in Dauphin, Manitoba, in the mid-70s showed many more positive outcomes, following the implementation of a guaranteed basic income compared to the old welfare-based hospitalizations system. Graduation from Grade 12 spiked, people were healthier, hospitals due to sickness, injury and mental health issues were significantly lower and more young women opted to complete school and wait before having children. The guaranteed basic income allowed families to make plans for the longer term, rather than fighting to free themselves of the welfare system’s poverty traps. It was eight years after the program ended before things reverted, finally, to the old measurements.
Mr. Speaker, I seek unanimous consent to conclude my statement. Mahsi.
---Unanimous consent granted