Once considered cranky, the idea is climbing up the political agendaby Stewart Lansley / January 6, 2017 / Leave a comment
On 1st January, Finland’s experiment in universal basic income (UBI) began. A random sample of 2,000 citizens currently receiving unemployment benefit are being given a guaranteed and unconditional €560 (£477) a month for the next two years. The amount will be deducted from any benefits they already receive but crucially, they will continue to get the sum even if they find work. The Finnish government hopes this experiment, which may be expanded to other low-income groups such as freelancers and small-scale entrepreneurs, will cut red tape, reduce poverty and boost employment.
Support for UBI is gathering pace. Other trials are also being planned by governments and local authorities in Utrecht in the Netherlands, Ontario in Canada and some parts of France. In the United States, Silicon Valley incubator Y Combinator is preparing to launch a private test run in Oakland, California. Over the course of a year, between 30 and 50 citizens are to be given a monthly income of $1,500-$2,000, at a total cost of some $1.5m.
Scotland could also be about to join the club, with the councils of Fife and Glasgow considering trials. Even 18 months ago, the idea of a UBI was widely viewed as pretty cranky. Now it is climbing up the political agenda. In mid-January, the House of Commons Work and Pensions Committee is holding an oral session on the idea.
The mounting interest is being driven by two key factors. First, disruptive economic change. For a growing proportion of the workforce, job opportunities have become much more fragile, with rising numbers trapped in low-paid, low-satisfaction and insecure employment. Although expert opinion is divided on the full impact of the new machine age, advances in robotisation and artificial intelligence will unleash widespread upheaval.
Second, the current system of social security is poorly equipped to deal with exploding insecurity. It is heavily reliant on means-testing, has downgraded the role of universal benefits, and comes with a heavy dose of conditionality. With governments exercising greater and greater control over the lives of claimants, the system has become much more punitive and intrusive.
With its built-in income guarantee, a UBI offers a real solution to these problems. It would bring a safety net in today’s precarious working environment, lower the…