The recent discussions of a Guaranteed Livable Income (GLI) in Finland (and the recent inclusion of it in the Green Party Federal Platform) got me thinking about the concept of a guaranteed basic income through a "student lens". Students have costs beyond tuition and other educational expenses to pay, and it can be difficult for them to cover them all, in addition to the standard costs of housing and rent, utilities, phone bills, food, and clothing. Accumulation of these expenses may often result in students falling into significant debt. It is often hard for students to pay off their loans, given that not all students are able to balance a part-time/full-time job while in school.
Many students are also struggling to pay bills even with part-time and/or full-time employment. With the economy still in flux, many students are falling into low-wage jobs right out of school, which only increases the income gap we see stratifying young adults. Countries such as Switzerland and Finland have been in talks for implementing guaranteed livable income as an alternative to their current system of social assistance. Finland recently announced their plans of paying every citizen a basic income of 800 Euro (equivalent to CAD$1170) per month in order to reduce the country’s unemployment rate. This amount is expected to be paid to all adults, whether or not they receive any other income.
A Guaranteed Livable Income is a helpful solution for students struggling to manage their debt. It provides a standard income amount to cover anticipated expenses, allowing students to sustain a modest living while in school. Currently, many students live below the low-income cut off; OSAP is only intended to provide supplemental funding for living expenses. GLI would eliminate the need for OSAP to take into account living expenses, because the GLI would cover the costs of "existing", for lack of better phrasing.
This would help to simplify the OSAP process as well: our well-intentioned but notoriously complicated student financial aid is near-impossible to navigate as a layperson. This new system would only need to consider costs that will be directly paid to the university, because the GLI would make up the bulk of students’ financial resources. The GLI would be easier to understand for students: it would be universal and the amount of funding given for indirect costs would be much more understandable and predictable for students. Currently students may have a difficult time predicting their OSAP, which may make it more difficult to budget. The GLI would also reduce the amount of overhead to run not only the programs for student financial aid, but many other programs as well. These efficiencies would create savings which would make it much easier to cover the program.
In the 1970s in Manitoba, the provincial and federal governments worked together to create a pilot project for GLI in the city of Dauphin. During the pilot, researchers found examples where GLI encouraged people to stay in school: they presumed because parents were able to support their children through high school, and children didn't feel required to drop out from high school to help support their family. By creating circumstances that better allow students to finish high school, it eliminates a major barrier to post-secondary education- particularly those from low income families. A standard income has the potential to bolster, not stagnate, market adaptability: with GLI, someone would know that they had a secure income and they would feel more comfortable leaving a position where they were unhappy, or that was made redundant: they could continue their education to further their career prospects and update their skills. This would be very beneficial for prospective mature students. In our current knowledge economy, the ability to gain more education is more essential than it was in the 1970s and a GLI would give this opportunity to all members of society.
Recent graduates could also benefit from GLI, as they would be more likely to be able to participate in the kind of personally risky (but societally beneficial) activities that bolster our economy- launching start-ups, for example . It can be difficult to facilitate innovation when new grads feel pressure to fulfil other commitments; the GLI would let entrepeneurs focus on their new venture and its success. I know that many students at my own institution, the University of Waterloo, have to take on other responsibilities while they are creating their start ups, diverting their attention.
The GLI has the potential to be a much more efficient system than the current student financial aid system, both in its universality and in its simplicity. The GLI would help to eliminate poverty, reduce income disparity, and improve students’ standard of living while in school. It's important to continue conversations about the GLI and how we might implement a similar system here: there is a lot of potential to help not only students, but all Ontarians.
Stephane Hamade
OUSA Steering Committee Member
Vice-President Education, Waterloo Federation of Students