Implementing universal basic income could cut poverty rates up to 40%: PBO

Universal basic income

Photo: The Canadian Press

Parliamentary Budget Officer Yves Giroux waits to appear at the Standing Committee on Natural Resources on Parliament Hill on Monday, Nov. 18, 2024 in Ottawa.  

The government's fiscal watchdog says a guaranteed basic income program at the federal level could cut poverty rates in Canada by up to 40 per cent.

In a new report, the parliamentary budget officer says that a Canadian family in the lowest earning group could expect to receive an average of $6,100 in annual disposable income through such a program.

Higher earners could see their income levels drop because of changes in the tax system to implement the basic income support.

This report is predicting a more modest impact on poverty rates than the PBO's 2021 report — which said that a guaranteed basic income could cut national poverty rates almost in half.

The PBO says that reduced impact is due to the wages of lower-earning Canadians not keeping pace with the surging cost of living.

The report says introducing a federal basic income program would cost up to $107 billion in 2025, depending on the family definition used to implement the program.