Ontario pays $320K in legal fight over its cancellation of basic income program

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After battling five years against a class-action certification process, the Ontario government has paid $320,000 to the law firm spearheading a lawsuit against the Ford government over its decision to cancel a guaranteed basic income pilot project.

Last month, Ontario Superior Court Justice S.T. Bale certified the lawsuit, filed in 2019, that seeks $200-million in general damages of behalf of 4,000 people who enrolled in the project.

On Monday, lead counsel Stephen Moreau will appear at Queen’s Park to urge the government to quit stalling the action.

“Stop fighting, stop delaying and get down to the business of doing justice and fairness by these people,” Mr. Moreau told The Globe and Mail.

Launched in April, 2017, under then-premier Kathleen Wynne, Ontario’s basic income pilot budgeted $150-million for a three-year program that would pay participants $16,989 a year (or $24,027 for couples). To qualify, applicants had to be living on less than $34,000 a year (or $48,000 for a couple) and reside in one of three municipalities: Lindsay, Thunder Bay or Hamilton. If the participants worked, the pilot payments would decrease by 50 cents for every dollar of earned income.

Hamilton resident Jessie Golem signed up hoping the program would give her enough financial breathing room to start her own business.

For years, she had been trying to launch a videography company focused on preserving stories and images of the elderly. But she had to work four jobs just to meet the financial demands of basic living – rent, food, transportation.

Her main source of income came from giving piano lessons to clients throughout the greater Hamilton area. The work was seasonal, came without benefits and required her to spend long hours in traffic hoping her 2006 Toyota Camry maintained its reliability.

“I call it Toyota Christ,” she said. “The odometer stopped at 299,000 kilometres. I really don’t know how many kilometres it’s got now.”

The pilot cheques started arriving in 2018. Ms. Golem kept up some work, but focused on her small-business plan. With the income reduction, the pilot payments totalled about $700 a month, she said, enough to cover rent and nothing more.

It was enough to change her life. She recalls driving back from a job exhausted one day wondering how she would make rent that month. When she remembered the pilot payment would be enough to satisfy the landlord, she started sobbing.

“It was this huge weight off my shoulder, one I didn’t even realize was there,” she said. “Suddenly I had the mental capacity to focus and start building my business. And it was working. I was booking more photo projects. I was seeing my client base build. I did a business plan and predicted I’d be off the pilot by Year 2 and that I’d be hiring staff by year three.”

A survey of 424 participants by the Basic Income Canada Network found that those sorts of improvements were widespread. One-third of respondents reported that the pilot gave them enough money to go to school. One in five said it funded their transportation to work.

Almost three-quarters said they started eating better and nearly three in five said they managed to improve their housing. A large majority felt less stress, anxiety and depression.

“Seeing lots of people being able to go back to school and get into training programs, that was remarkable but no surprise to us.” said Sheila Regehr, a board member of the network. “I think the mental-health thing was surprising. The speed at which people’s health improved, even we didn’t expect that.”

After ousting Wynne’s Liberals, the Ford government terminated the program in July, 2018 – roughly one year into its three-year timeline. The last cheque went out in March of the following year.

The plaintiffs argue that the termination amounted to a breach of contract. Anticipating three years of guaranteed basic income from the pilot, many of the participants had invested in new business ventures, paid education fees and started medications and therapies, according to the statement of claim. The sudden loss of income triggered panic attacks, anxiety, manic episodes, suicidal ideation and other mental-health issues.

Neither the Ministry of Children, Community and Social Services, which administered the program, nor the current minister responsible responded to The Globe’s requests for comment.

For Ms. Golem, that familiar psychological weight of living paycheque to paycheque returned. Before the payments ended, she had spent months, photographing pilot participants and gathering their stories. Since then, she’s put her business on hold and returned to piano lessons. That will only last as long as her Toyota does.

“It’s demoralizing and discouraging,” she said. “It’s not that I failed, it’s that I was never given a chance to succeed.”