A brief introduction to basic income
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Basic income refers to unconditional regular cash payments to individuals, differing from current social security systems which involve means-testing and are often stigmatized. While various pilots exist, no country has fully implemented it, and critics argue it may subsidize bad employers or discourage work. The document discusses potential impacts of basic income, such as poverty reduction and improved health, while highlighting the flaws in the current benefit distribution system.
A brief introduction to basic income
- 1. Basic Income some introductory notes
- 2. basic income means every individual receives a regular payment of cash to live on
- 3. • There is no country where there is a full working basic income system. • There are and have been pilots of basic income around the world. • Bits of our current system (state pension and child benefit) are quite close to being a form of basic income. • Social security for working age people has moved away from the principles of basic income. • There is an international campaign for basic income (e.g. BIEN and Basic Income UK). • Basic income is Green Party policy and John McDonnell has expressed support for the idea in the past.
- 4. basic income is a radical change to the social security system (ie tax and benefits)
- 5. basic income is different • No means-testing (within the benefit itself) - universal • No stigma and shame in claiming benefits - invisible • No sanctions, you get it no matter what - unconditional • No dependency, not family-based - individual • Less confusing - simple(r)
- 6. basic income impact (?) • Reduce poverty • Improve health • Improve work life • End stigma • Reduce suicides • Reduce bureaucracy • Increase solidarity • Increase citizen action • Improve life for carers • Reduce domestic violence • Improve learning
- 7. basic income in practice • There is no agreed model or set level • Housing subsidies may best be treated separately • Attention will still need to be paid to disability costs • It is not a replacement for existing public services • Community support and responsibility are still important
- 8. basic income critics Left-wing (e.g. NEF) • It is better to give people services than money • It is a subsidy for bad employers • It will distract people from fighting for employment rights • It won’t be sensitive to differing needs Right-wing (e.g. JRF) • It is not affordable • It won’t be accepted • It will discourage work • It will encourage dependence on the state
- 9. Benefits are not government expenditure they are part of a system of redistribution constrained by political power
- 10. People generally do not understand how widespread benefits already are…
- 11. how benefits are distributed
- 12. Nor, how unfair the current system is, e.g. the poorest pay the most tax…
- 13. how taxes are distributed
- 15. In fact the real (after tax) cost of benefits is VERY LOW…
- 17. For the better off it is effectively the equivalent to the cost of a cup of coffee…
- 19. The current system is not just bad, it has also got progressively worse, with income being taken away form the poorest…
- 21. If we really did redistribute money effectively then we could eliminate poverty and radically reduce inequality…
- 22. 1. Reduce the income of richest 10% by 8.9% to lift income of poorest 10% to level of second decile and improve equality ratio to 1:5 2. Reduce the income of the richest 10% by 15.2% to lift income of poorest 20% to level of third decile and improve equality ratio to 1:4 3. Reduce the income of the richest 10% by 27% to lift income of poorest 30% to level of fourth decile and improve equality ratio to 1:3 what we could do instead
- 24. If we were prepared to change the tax system then it would not be hard to come up with a basic income system more generous than the current system
- 25. • Child Benefit (first) = £20.70 (£1,080) • Pension = £125. 90 (£6,546) • Basic Tax Credit = £37.70 (£1,960) • JSA (over 25) = £73.10 (£3,800) • Tax Allowance = £45.58 (£11,850 @20% = £2,370) • ESA (support group) = £110.75 (£5,759) • LHA (1 bed Sheffield) = £94.80 (£4,930) some existing benefits
- 26. but some groups would do better than other groups and some people would have to pay more tax…
- 28. What will also help is if we start to think differently about (1) economics (2) wealth and (3) work…