Prospects for Basic Income

Is basic income really possible in Scotland?

A basic income is an unconditional, non-withdrawable, non-selective payment to every individual citizen. In other words, we all would receive the same amount of state support at a level sufficient to provide genuine quality of life regardless of whether we were in paid work.

To many people hearing about basic income for the first time it sounds like a pipe dream, a post-scarcity policy lifted straight out of science fiction. But then on Tuesday the Scottish Government surprised us all with this bombshell.

“We will fund research into the feasibility of a citizens’ basic income scheme.” – Scottish Government Tuesday 5th September

A conversation that started with Fife Council in 2015 has become a partnership between four local authorities and the Scottish Government about running basic income pilots across Scotland.

Between them, Glasgow City, Edinburgh City, Fife and North Ayrshire Councils are responsible for the welfare of 1.6million Scots, that is one third of the population of Scotland potentially eligible to participate in a pilot. More councils are expected to come forward to join discussions.

As a society we are faced with increasingly complex challenges around inequality and insecurity. The solution is not to pursue ever more complex solutions and mutations of the status quo, with the counter-productive consequences of poverty traps and financial dependency, but to embrace the simple and straightforward idea that each individual is deserving of the happiness, health, and security that an unconditional basic income would bring.

So is a basic income affordable? Well the answer to that question is that it depends what we are talking about. If we were to distribute the current spending on welfare amongst every UK citizen equally we could have a basic income today of £4,000. This is obviously woefully inadequate. One suggestion is to have a basic income set at the UN poverty benchmark, which on paper would eliminate poverty at a stroke, but I don’t think that being on the cusp of poverty is the minimum quality of life to which we should aspire for Scotland. So we need to think about alternative models of generating revenue.

One simple and popular answer is to reform income tax so that we all pay higher taxes, perhaps even eliminating the personal allowance, and then setting a basic income at a level that there is an income where people ‘break even’. It is easy to forget that in the 70s the top rate of income tax was over 90%, yet we still had millionaires. We all have a greater stake in society and our communities than our income tax would suggest and I see nothing wrong in increasing taxes to reflect that. By taxing wealth and redistributing it amongst everyone, we lift the poorest out of poverty and insure the wealthy against it.

Currently, of the 20 largest economies in the world Great Britain ranks 15th for corporation tax, with only Russia, Turkey, Korea and Saudi Arabia taxing less. In 2020 we will be 19th. There is clearly scope for raising additional revenue, even more if we devote as much time to tax evasion as we do to chasing benefit “cheats”.

Versions of a basic income already exist in Alaska and Norway where a sovereign wealth fund has been established so that the profits from the oil trade are distributed amongst the citizens. These can take time to establish but are a worthy goal. Scotland obviously has not benefitted from its oil in the same way, which is another story, but the same can be achieved through the use of other national resources such as renewable energy, or by taxing emissions.

In many ways we already receive a form of basic income in the form of public services. What is the fundamental difference in a common income to protect against poverty, even if you are not poor, and a health service to protect against illness, even if you are healthy? The point here is that when a problem has many proposed solutions the safest conclusion is that the problem can be solved. Whether or not a policy is affordable is ultimately a question of whether or not it is ‘worth it’. So how can we decide if a basic income is worth it based on some pilot schemes? Pilots are not reality on a smaller scale, but still offer an opportunity to learn, and we need to decide how we measure success.

Proponents of a basic income claim that it would have a large impact on many of the problems caused by inequality and poverty, as well as free people from financial dependency and offer a safety net for those industries soon to be automated away. So how do we know if it is working?

Initial results from the recent basic income experiment in Finland show a large reduction in anxiety amongst those receiving a basic income. In many senses, perhaps anxiety is the best possible measure for the success or failure of basic income. If you think about it, the whole point of society is to improve the lived experience of those members within it. We target living standards, health, crime, and poor education because they are detrimental to the experience of being alive in Scotland. Why measure anything else other than whether basic income makes people happier? We cannot let the basic income debate be dominated by questions of cost savings elsewhere, though these would be significant, because you cannot measure the human experience in pounds and pence.

A basic income is a simple idea easily misunderstood. In principle it is a politically neutral idea, giving both greater liberty to an individual and reducing social inequality. In practice we face a battle against headlines about ‘money for nothing’, and a ‘scroungers charter’. No doubt we will see fearmongering about mass immigration that the world will turn up at our door with their hands out.

Sensibly planned pilots across Scotland that complement rather than replicate each other, set at sufficiently high levels to make an impact, and lasting for years rather than months are essential to having a rational debate about starting again with the welfare state. These will take time to plan and implement, and longer to understand the effects. In the meantime read beyond the headlines and keep an open mind.



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Comments (18)

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  1. Crubag says:

    My calculation was that if we paid all adults the living wage it would cost more than the entire public sector budget for Scotland…

    I think the Finland example wasn’t an unconditional income but a time-limited payment to get people into work, but that it continued for a while post-employment to help people bed down into work.

    1. Mr T says:

      Surely the point is that you amend the tax system so that the living wage soon becomes consumed by extra tax for those above a threshold. What you save is the admin of unemployment benefit and maybe state pensions at the other end.

      Another way of looking at it is a negative income tax band. The state starts off by paying you and as you earn more the tax band takes it back.

      1. Crubag says:

        I’m not sure about the admin argument – essentially all non-workers would now fall into the tax system, young people, pensioners etc. so that would need to expand. There would also need to be increased policing of the system to avoid living wage tourists.

        How high would the tax take need to be to recoup enough to pay all non-workers?

        My back of a spreadsheet calculation is that to pay all Scots adults the living wage of £16,400 would cost £61.5 bn. Total income tax take is only £11.3 bn, so even if you taxed income at 100% above £16,400 it wouldn’t be enough to cover the bill.

        1. Mr T says:

          Good point about the increased tax workload and I had thought of mentioning ‘tourists’ but didn’t.

          And taxing at > 100% tends not to be effective either 🙂

  2. Leigh French says:

    basic income =/= sovereign wealth funds

    calling them a “worthy goal” is somewhat ironic just as ‘the Left’ in Norway in the context of the election has challenged precisely that perception… and Alaska’s is anything but!

    basic income =/= public services

    there’s an immense difference between universal services free to all at the point of delivery and an individual dividend with which to purchase services should that dividend cover the cost – hence UBI’s problem with housing costs in particular, and the implications of citizenship requirment for groups such as e.g. Cops Not Docs in accessing services

    basic income =/= reducing anxiety

    the relative political weakness of the left is preventing eliminating the pschyo-coercion of the current UK system, moreover those responsible for it are the ones being asked to implement a basic income – basic income is not a panacea for the left’s weaknesses

    basic income =/= “a simple idea easily misunderstood”

    as acknowledged by those overseeing what admitted to be an employability experiment in Finland, it’s first-and-foremost a complex behaviour and incentive structure, a combination of welfare architecture and citizenship regime, giving the state unprecedented access to define and influence a social whole – ie for cohering that national ‘citizen’ who’s the state target of basic income

    so no, basic income =/= “greater liberty to an individual and reducing social inequality”

    rather than this media-churn repeatedly projecting superficial populist tropes, and thereby effectively reinforcing opposition along those particular xenophobic lines by repeating such choice criticisms… it’d be useful to engage in the more substantive criticisms and participate in the praxis e.g. Wages For Housework attempted, which wasn’t policy advocacy but opening up a problematic for discussion so as to more fully comprehend what the intersectional dynamics of social reproduction are *and* addressing them through doing so – ie something very different from a mobile policy fix hot on the heels of other such competitive ‘urban fixes’ (Richard Florida’s latest apology for the inequalities of ‘creative’ boosterism not withstanding)

  3. Graeme McCormick says:

    According to GERS around £27billion 0f the £71 billion of Scottish public expenditure is spent on social security , pensions etc in Scotland . If we increased that to £55 billion that would produce a Citizens income of £10,000 per annum for everybody.

    That would increase total public expenditure to around £100 billion. An Annual Ground Rent levied per square metre on our land and floor space would provide this money and replace all existing UK and Scottish taxation.

    In urban land type in Scotland that amounts to about £7 per square metre.

    1. Mr T says:

      Where do I sign up? Right now I pay about £75k in income tax, another £33k in employer & employee NI, VAT, duties on fuel, alcohol, tax on insurance, APD etc.

      I think my £7 / SQM ground rent would be £18k.

      1. Crubag says:

        I think £10,000 per adult (including pensioners) would be about £37.5 bn.

        But annual ground rent? If the average house size in Scotland is 76 sqm, then it would cost the average household £41,600 to raise £100 bn.

        (If it was applied to warehouses, I’d imagine they’d all move to Berwick and Alnwick.)

        1. Mr T says:

          I’m pro Land Value Tax (and I’m centre-right, not Green!), but this notion that it can replace all other taxes is madness. Needs to be part of a balanced tax regime that taxes lots of things/activities/transactions a bit, as otherwise everybody will just avoid the one thing that would be taxed. And as you say, get ready for lots of cross-bordering!

          And while we’re on the subject how much land do Amazon & Apple occupy? They may dodge their Corp Tax, but they & their staff still pay VAT, Income Tax, NI etc.

  4. Willie says:

    I agree with this. Not having to work and make a contribution to society sounds a surefire recipe for success.

  5. MBC says:

    For me the issue is not financial feasibility but one of human psychology. The pressure to make ends meet drives people to seek education and employment. Being gainfully occupied is a force for good, it brings wellbeing. I agree there is a balance to be struck. If the struggle for life and livelihood is too hard, too insecure, too lacking in fulfilment, people become dispirited and anxious. But if it were removed all together, would people use their security and leisure gainfully, to fulfill their potential, and to have more time for relationships and culture? Or would they become demotivated? I think there have to then be other cultural drives present in society, such as pursuit of various types of excellence that don’t carry a monetary or commercial value. Our society is sadly lacking in such cultural drives. Would removal of insecurity allow people to blossom?

    The notion of lesisure, what constitutes it, and what it should be for has preoccupied philosophers since the time of the ancient Greeks.

    1. Leigh French says:

      The UBI experiments we’re seeing are not about not working… they’re *all* about economic activity and the relative competitiveness of the nation-state as against others.
      Aside from the many critiques of protestant work ethic, however reconfigured as wellbeing agendas and excellence frameworks etc, a basic income is not a living income – increasingly we’re even seeing ‘basic’ further revised downwards with the additional descriptor of ‘partial’.
      Crucially, the actual experiments themselves are explicit enough in them being about economic activity – so confusion over this isn’t necessarily the fault of those overseeing the experiments, responsibility falls on the cheerleading.
      Part of my concern with UBI policy advocacy is that it doesn’t actually attempt what Wages For Housework set out to achieve… to make visible so as to contest our contemporary conditions of social reproduction, all “the labour that goes into reproducing us as human beings”.

      1. Hi Leigh – thanks for the comments / insights. Can you unpack what you mean a bit by “they’re *all* about economic activity and the relative competitiveness of the nation-state as against others”?

        Maybe you can tell people a bit about Wages for Housework who arent familiar with it?

        1. Leigh French says:

          As a very quick sketch… the focus around employability and state competitive anxiety comes through in the following two articles:

          * ‘Is Finland’s basic universal income a solution to automation, fewer jobs and lower wages?’, Sonia Sodha (19/2/17)

          * ‘Finnish citizens given universal basic income report lower stress levels and greater incentive to work”, Ben Chapman (21/6/17)

          The Finland experiment’s talk of ‘going further than nudge […] in government innovation’ (directly referencing the UK ‘Nudge unit’ and Mindlab in Denmark) comes out of e.g. the Demos Helsinki think tank:

          What’s interesting (to me) is that mere talk of UBI emerges as a form of competitive virtue signalling that fits perfectly with the accepted interests of region- or nation-branding campaigns – ie with originality (sic) and entrepreneurship finding expression in the would-be national character of the individual and his/her actions etc. (As to who could ever be against such ‘innovation’?, see Tinna Grétarsdóttir.)
          Nation Branding is the national image management of ‘commercial nationalism’, a now normalised aspect of political and economic international relations (trans/national governance) where reputation is connected to political influence in the world. It concerns developing brand platforms in a ‘promise’ to capture an aspirational, idealised vision of nationhood. As a mobilising discourse, this then impacts complex struggles around national identity, governance, and state building (see Nadia Kaneva). Moreover, UBI evidently has utility for the focus of boundary struggles between regional/national scales as the site for understanding everyday life experiences and the exercise of power.
          I suspect academic papers will start to appear which relate the take-up of UBI as a mobile policy script similar to and trailing the circulation of ‘creativity’ as yet another urban policy fix for ‘austerity’ (see Jamie Peck). A policy those on the competitive treadmill can hardly be seen to be without for fear of being left behind in the struggles over inter-regional competitiveness (which helps explain the uncritical take-up of Richard Florida’s urban boosterism).
          But I think (by way of Foucault) attention ought to also be on processes of neoliberal ‘subjectivisation’ – ie UBI as a complex behaviour and incentive structure, a combination of welfare architecture and citizenship regime – with work expanded to all life, in a vast subsumption of everyday life, promoting work-on-the-self or the ‘enterprising self’. What emerges is a self that is “defined by the steering of action, feeling, thinking and willing on the basis of an orientation on the criteria of economic efficiency and entrepreneurial calculation” (see Andrea Bührmann). I think it’d be worth drawing that together with nation-branding literature on the exclusionary hailing of the target-citizen to ‘live’ and effectively become ‘the brand’.
          Rather than repeating the kinds of IndyRef entanglements around affordability and escalating demands for endless paths of evidence (similar to how Jodi Dean discusses ‘conspiratorial fears’), I think it’d be refreshing to see an exchange between e.g. feminist economists and those exploring UBI as shift from production to consumption (the ‘good’ citizen as consumer).

        2. Leigh French says:

          “…The International Wages for Housework Campaign grew out of the International Feminist Collective in Italy, which was founded in 1972 by Selma James, Brigitte Galtier, Mariarosa Dalla Costa, and Silvia Federici, to promote political debate and action around the issue of housework. The group published a autonomist Marxism autonomist journal, Matériaux pour l’intervention. Dalla Costa, one of the members of the group in Padua came from the intellectual movement operaismo, which developed around factory strikes in Northern Italy in the 1970s. The Wages for Housework Campaign took the idea from operaismo of the wage as central to the struggle for worker control and rights of industry. Operaismo encouraged workers to act in their direct interests when it comes to demanding compensation for their labor and exploitation in the factory. The Wages for Housework campaign applied that to the social factory, a conception of society whereby “the whole of society lives as a function of the factory and the factory extends its exclusive domination to the whole of society”. …”

          Wages for Housework is differently covered in these two short articles (with a link to Mayday Rooms’ archive) relating the campaign to current experiments:

          * Universal Basic Income: The great escape? – Rachel Twaites, Billy Griffiths and Peter Lewis-Morgan (14/8/16)

          * Why a basic income alone will not be a panacea to social insecurity – Neil Warner, Frederick Harry Pitts, and Lorena Lombardozzi (7/9/17)

          Kathi Weeks’ problematising appeals to me, where Weeks proposes UBI as a development linking back to WFHW, opening up to exploration and debate:

          “…The question remains, then, what it might mean to ‘refuse’ the work of social reproduction as it is presently organized and divided. As feminists have learned, refusing domestic work is a far more difficult project with potentially more far-reaching effects. In my opinion, the refusal of work in this terrain involves at minimum, the critique of the family as the institutional lynchpin of the social relations of domestic reproductive labor and the family ethic as its ideological support. At maximum it means confronting the entire organization of work and life.
          This is one of the many reasons why I have been so interested in the 1970s Wages for Housework literature. What these theorists and activists attempted is what I see as one of Marxist feminism’s most difficult maneuvers: to make domestic labor visible as work and part of the valorization process but at the same time, insist it is not something to celebrate or revere. This is a very difficult thing to do: to gain its recognition as socially necessary labor (that requires, for example, more time off from waged work to accomplish), but not to overvalue it as such — to insist rather on its demystification, de-romanticization, de-privatization, de-individualization, and of course, de-gendering. As work, it too is something to struggle against becoming the whole of life. As I see it, this means struggling against — to name only a couple of things — the gender division of this work, the appalling conditions of so much waged domestic work, as well as forms of work intensification such as the ideology of intensive mothering. It also involves the invention of new ways of organizing and sharing work and of making it meaningful.”
          * Feminism and the refusal of work: an interview with Kathi Weeks – George Souvlis / Kathi Weeks (August 28, 2017)

          But what’s interesting (for me) is how UBI through policy advocacy is instead being given a transcendent post-ideological make-over – hence its pragmatic policy appeal. As to why that might be the case, I think we’d need to get to grips with the workings of technocracy and consensus in Scotland’s policy context – see Paul Cairney on the Scottish Approach to Policy Making:

          “Basic income is therefore often posited as a post-ideological solution suited to a new era of politics: the odd confluence of interest from the left and right tends to be read as a sign that political positions should be eschewed in favor of rational compromise. But UBI’s cross-ideological appeal is the bug, not the feature. Because basic income is politically ambiguous, it also has the potential to act as a Trojan horse for the left or right: left critics fret that it will serve as a vehicle for dissolving the remains of the welfare state, while proponents herald it as the “capitalist road to communism.” The version of basic income we get will depend, more than policies with a clearer ideological valence, on the political forces that shape it.”
          * The False Promise of Universal Basic Income – Alyssa Battistoni (Spring 2017)

  6. Kenny McIntyre says:

    The conversation flows:

    “I am fed up of subsidising the work shy life styles of people on the dole!”

    – How do you know they are work shy?

    “Stands to reason, you see them out boozing, we are paying for that!”

    – But with out money, these folk would starve or have to beg and or commit crime to buy food.

    ‘Don’t care, that’s what jails are for, we should only give to those that deserve!”

    Topic change:

    – Did you see that hurricane and the aftermath?

    ‘Why are we giving money to these people in the West Indies?”

    – The uk has a moral right to do so, it rules these territories and the people have had a disaster visited upon them.

    ‘No foreign aid, we should only give to our own!”

    – who are our own, and of those, who is deserving?

    Conversation ends!

    The theme that emerges is that money should only be give to our own and those that deserve. In other words (ME!).

    It surprises me how entrenched these views are and how difficult it will be to overcome them.

    Funnily enough, I see a close synergy with these beliefs and unionism.

    1. Willie says:

      What’s mine is mine, and what’s yours should be mine too.

      That in very simple terms is how our Great British democracy is playing out as the rich get richer, and the poor poorer.

      Austerity for the masses, it’s what we voted for, and all the theorising will not change the direction of travel, unless or until people have had enough.

      Clearly they haven’t had enough.

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