Trailblazing BC study gave homeless $7,500 - and it worked

Have you ever been asked for change by someone on the street, only to deny their request based on an assumption the money would be spent on activities that would only worsen that individual's situation?

If so, you're not alone. 

But, according to the newly released findings of a bold B.C. study, those preconceived notions may not be rooted in fact. 

Vancouver-based Foundations for Social Change, in partnership with the University of British Columbia, is responsible for "the New Leaf project," a stereotype-busting study and social program that's being heralded as a "global first." 

As part of the project, researchers provided 50 people who had recently become homeless with a one-time cash transfer of $7,500 in the spring of 2018. The program's recipients had full control over how they chose to spend the funds.

Researchers tracked participants' lives for 12 months after doling out the cash, and compared recipients' outcomes to those of a control group who were also experiencing homelessness, but didn't receive the payment.

Preliminary findings show that on average, those who received the cash moved into stable housing faster than individuals in the control group. The results, set to be peer-reviewed next year, also demonstrate that cash recipients achieved and maintained a level of financial and food security in the year following the payment, increasing their spending on food, clothing and rent and reducing their spending on products like alcohol, cigarettes, or drugs. 

Empowering the 50 cash transfer recipients to meet their own needs and move into housing faster also freed up space in shelters, saving the shelter system $8,100 per person over the year-long study, Foundations for Social Change explained in a news release. 

In order to receive the money individuals were required to meet criteria that showed they do not abuse substances, explained Dr. Jiaying Zhao, principal investigator and professor at UBC. "These individuals also demonstrated no major symptomology for mental health disorders, and showed a readiness for change," Zhao added. 

"To prevent people from becoming entrenched in homelessness, we need to provide meaningful support as close to the time of becoming homeless as possible," said Claire Williams, Foundations for Social Change's CEO. "Our research shows that cash transfers allowed people to access housing faster, improving stability and lowering the risk of trauma."