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Basic income: a roof over their head?

A guaranteed annual income has the potential to prevent or end the homelessness of thousands of Canadians.

Tonight an estimated 35,000 Canadians will sleep in shelters, on the street or in some form of temporary accommodation.

Over the course of a year this number balloons to over 235,000 Canadians. It’s notable that for the vast majority of these people — over 85 per cent — homelessness is a short-term and infrequent experience stemming from poverty

Aside from the tragic human cost, homelessness also exacts a significant financial toll, costing the Canadian economy over $7 billion per year. This cost is born primarily by the provinces who bear the burden of health, justice and social service costs accrued by vulnerable homeless people bouncing aimlessly through expensive public services as a result of worsening health and the predictable interactions with the justice system that come from poverty, addiction and mental illness — interactions more effectively remedied by housing and support.

"Homelessness is the result of an intricate interplay between structural factors."

In the early-1980s homelessness was such a minor issue in Canada that there were very few counts completed. In one of the country’s first ever homeless counts in 1992, the City of Calgary counted 447 people as homeless. By 2008 that number had exploded to over 4,060. This pattern has played out in communities across the country.

The popular narrative on homelessness in Canada would have you believe that homelessness is the product of addiction, mental illness, and/or poor choices by individuals. The fact is, modern mass homelessness in Canada is primarily the impact of austerity on the very poor — the result of fewer affordable housing options for the poorest Canadians who now have lower incomes and less income security.

lachine_newsart_homelessimagejpg.jpeg.size.custom.crop.557x650.jpg(Paul Lachine / NewsArt)

Current interest in a guaranteed or basic income provides an important and needed opportunity to examine how income, services, and housing policies can work together to end homelessness and its human and economic costs.

Homelessness is the result of an intricate interplay between structural factors (social policy, housing market and labour market changes, for example) and individual circumstances (poverty, addiction and mental illness, for example). Since there is no evidence to suggest a dramatic change in the rates of mental illness or addiction among poor Canadians over the last 25 years, the evidence points us to structural factors to explain the rise of homelessness.

The large-scale homelessness we see today in Canada coincides with the rise of austerity and closely mirrors the American experience. While there have been changes in economic conditions and housing markets, the single biggest change that explains the rise of homelessness is the impact of austerity on very poor Canadians.

Austerity in Canada began slowly in the 1980s but picked up steam in the 1990s and became the policy of choice over the last decade. This meant deep cuts to provincial transfers (the money the federal government pays to provinces that the provinces in turn use to pay for everything from health care to welfare) and cuts to direct federal spending on almost everything.

"The poorest Canadians have been left to seek housing in the increasingly expensive private rental market and pretty much on their own."

Among the cuts was the national affordable housing program (in place since in 1973), effectively ending federal investment in new affordable housing. This left the provincial governments, also fighting significant budget deficits, to pick up the slack, which they could not.

According to the 2014 State of Homelessness in Canada report:

In 1982, all levels of government combined funded 20,450 new social housing units annually. By 1995, the number dropped to around 1,000, with numbers slowly climbing to 4,393 annually by 2006. Over the past 25 years, while Canada’s population increased by almost 30 per cent, annual national investment in housing has decreased dramatically, by over 46 per cent.

While recent attention has been rightly focused on federal investment in housing and a long-sought National Housing Strategy, we can’t forget the poorest Canadians faced an austerity double whammy — along with the cuts to affordable housing came cuts to welfare and income support.

Reduced provincial transfers saw reductions in the amount of assistance many could receive along with increasing restrictions on eligibility. Tightening eligibility criteria saw the number of households receiving assistance in Canada fall dramatically, from a peak of 3.1 million in 1993 to 1.7 million by 2005. Those who find themselves among the growing population in homeless shelters were most affected and least likely to access existing income supports or social services.

"Income is critical if we are to address this need in an enduring way."

With increasingly limited affordable housing options, the poorest Canadians have been left to seek housing in the increasingly expensive private rental market and pretty much on their own.

In a newly released examination of rental markets in Canada’s nine largest cities, University of Calgary professors Ron Kneebone and Margarita Wilkins note “a very strong trend of falling [housing] affordability [for very poor Canadians] brought about by a significantly faster average annual rate of growth in rents relative to social-assistance incomes.”

Montreal and Quebec City are notable exceptions to this trend — and the reason is instructive to the consideration of guaranteed annual income. Kneebone and Wilkins write:

Since 1990, the affordability of rental accommodations for those with very low incomes has actually improved in Quebec City and Montreal. This is unique in Canada. It has mainly been the result of significantly larger increases in social-assistance incomes provided in the province of Quebec than elsewhere and somewhat slower increases on rents on [lowest cost] rental units.

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(Jon Bonar / Toronto Day of Action, 2015)

A guaranteed annual income is designed to “ensure everyone sufficient income to meet basic needs and live with dignity, regardless of work status.” Housing is most certainly a basic need and income is critical if we are to address this need in an enduring way.

 Let’s take as an example the contrast in the state of homelessness in Alberta and Quebec.

The metropolitan Montreal area has a population of just over 4 million people and counted 3,016 people as homeless in their most recent homeless count in 2015. By comparison, Calgary has a population of 1.4 million and a homeless count of 3,555.

"A guaranteed annual income would also help to make it far less likely that job loss, divorce, family conflict, domestic violence, injury, or illness result in homelessness."

On a per capita basis, homelessness in Calgary is over three times higher than that of Montreal. There are inevitably many factors to consider in comparing homelessness in both communities (for example, social housing infrastructure, shelter beds, social support services and demographic factors, as well as labour and housing markets), but it’s interesting to note the correlation between rental housing costs, social assistance, and rates of homelessness.

Kneebone notes that Calgary is the most expensive place in Canada for poor people, whereas Montreal and Quebec City have consistently been the best places to live for low-income earners:

There are many factors that helped create that disparity, but the primary one is the fact that over 24 years, rental prices in Calgary have increased an average of 3.4 per cent annually, compared with an annual 1.6 per cent rise in social assistance funding. Conversely, the average rent in Montreal rose an average of two per cent with social assistance climbing 2.6 per cent.

For the vast majority of people who experience homelessness in Canada, the experience is brief and infrequent — over 85 per cent of those who experience homelessness are considered transitionally homeless. For these people, homelessness is primarily the product of poverty and high housing costs with a lower prevalence of other issues like mental illness or addiction that can be barriers to housing. Another segment, representing about 11 per cent of the population, is episodically homeless with repeated episodes of homelessness and housing instability over their lifetime as well as longer stays in shelter.

We know from experience across North America that people with less complex needs will be able to resolve their own homelessness with little or no targeted services, beyond support for paying rent. In another recent paper, shrinking the need for homeless shelter spaces, Kneebone and Wilkins studied housing affordability in 51 Canadian cities to identify to what extent efforts at poverty reduction may enable closing of emergency shelter beds. They showed that even a relatively modest increase (as low as $1,500 per year for a single employable person) in the incomes of the very poor (those on social assistance) could shrink the need for emergency shelter beds by over 20 per cent nationwide.

"Lifting people out of poverty must be a critical plank of any strategy to end homelessness."

By bridging the gap between income for the very poor and the cost of housing, Montreal has been relatively successful in moderating homelessness by — at the very least — ensuring people who might become transitionally, or even episodically, homeless have the income to retain their housing.

A guaranteed annual income would also help to make it far less likely that job loss, divorce, family conflict, domestic violence, injury, or illness result in homelessness. And it would help the many homeless people who do not now qualify for other forms of assistance.

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(Jon Bonar / Toronto Day of Action, 2015)

Furthermore, providing income in a way that allows choice and some degree of autonomy has been found to be critical to the effectiveness of the Housing First model demonstrated by the Mental Health Commission of Canada, now deployed nationally by the Government of Canada through the Homelessness Partnering Strategy and central to strategies that have proven effective in reducing homelessness across North America.

As was noted earlier, for 85 per cent of people who experience homelessness, that experience is short and infrequent and principally the result of poverty, while another 11 per cent are episodically homeless. The last segment are people who are considered chronically homeless. Chronic homelessness accounts for two to four per cent of all people experiencing homelessness, but includes those people who typically have multiple complex needs, extensive barriers to housing, and require specialized support to leave homelessness.

"There are no silver bullets."

Even though these people represent a minority of those experiencing homelessness, they take up as much as two-thirds of all emergency shelter spaces in Canada. Lifting people out of poverty, then, must be a critical plank of any strategy to end homelessness.

Chronic homelessness also highlights a caution on a guaranteed annual income — there are no silver bullets. Homelessness is the product of an intricate interplay of primarily structural factors. Income is one of the most important of these structural factors but it isn’t the only one. A guaranteed annual income cannot and should not been seen as a replacement for investment in social housing and health care or essential improvement in co-ordination of local homelessness systems.

A guaranteed annual income however, has the potential to prevent or end the homelessness of thousands of Canadians. It could, if combined with the right housing policies and public services, be transformational in Canada’s response to homelessness. As renowned Canadian housing scholar David Hulchanski says, homelessness is “about inadequate housing, inadequate income and a lack of appropriate social supports.”

Current income supports do not meet the needs of many homeless people in terms either of access or adequacy. A guaranteed annual income, combined with adequate social supports, ensures even those Canadians with the most complex needs can be successfully housed. The long-term savings would be enormous, and the benefits to human dignity incalculable.

First published in the Canadian Centre for Policy Alternative's Basic Income Compendium: Rethinking Social Policy, 6 October 2016.

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Tim-photo-2012-2-2.jpgTim Richter is the President & CEO of the Canadian Alliance to End Homelessness.Prior to joining the CAEH, Tim was President & CEO of the Calgary Homeless Foundation (CHF), charged with leading the implementation of Calgary’s 10 Year Plan to End Homelessness – the first plan of its kind in Canada.

 

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