Should Labour embrace universal basic income? Anthony Painter and Fiona Twycross debate
The social policy of successive governments has been based on a simple premise for a quarter of a century or so. If you had a job then you would be economically secure. And with employment at record levels, we now know that a job is not enough. Economic insecurity persists and remains a challenge that every progressive is alert to.
In a recent series on economic security, the RSA has concluded that 30 per cent of workers are either chronically or acutely precarious. Forty per cent remain in a situation of uncertainty – it is a 30-40-30 working society.
We know that there is more in-work than out-of-work poverty, and 30 per cent of people experience poverty in each four-year period. And the RSA work shows that 40 per cent of workers have access to accessible savings of less than £1,000 (32 per cent have less than £500).
What on earth has all this got to do with universal basic income? Everything, as it happens.
The whole purpose of the social contract is to counter-balance market driven insecurity with social security (hence the name).
However, in the modern incarnation, that was flipped into a belief that engaging in the market, in and of itself, would constitute security. And now we have a system replete with sanctions, conditions and the arbitrary interference of the state in deciding what is best for individuals. Economic insecurity and its harmful impacts on the individual and families is a constant for too many – in or out of work. Our system is essentially ‘flexinsecurity’ as opposed to ‘flexicurity’ as enjoyed in Scandinavia.
UBI works differently. It means everyone can count on a baseline. It is not enough to escape poverty in itself but in allowing the individual to make good work choices, develop their skills from time to time, undertake caring responsibilities and even setting up a business it provides a platform to do so.
Wherever it has been tried, it has led to improved health, educational outcomes, and better life choices. Withdrawal from work has basically been non-existent, though some have adjusted their hours slightly to better accommodate family responsibilities.
Does it cost more than the current system? Yes, because it provides more security for more families. Is it unaffordable? We could properly fund a UBI and state spending would still be at 40 per cent of gross domestic product – without increases in tax for basic rate taxpayers.
Is it a magic bullet or a panacea? Of course not, but it is a key component of a modern secure social contract.
There are three reasons not to engage with a proper discussion on UBI. First, you do not think economic insecurity exists or matters. Second, you think the current system can be tweaked to resolve economic insecurity despite evidence to the contrary. Third, you do not want to lean in to the politics of making the case for change.
But surely progressives need to bold? There, the case for UBI and I did not mention the robots once.
Anthony Painter is director of the RSA’s Action and Research Centre
As we face the latest revolution in the workplace with increasing automation of jobs, the future seems uncertain.
Wages are stagnating and those who receive low pay and rely on state support to supplement their income are facing a hostile regime based on suspicion and sanctions. Too many people simply cannot make ends meet whether they are in or out of work. In one of the richest countries in the world, the number of people accessing emergency food parcels at food banks continues to increase. Earlier this year, we saw child poverty rates rise, with areas like Tower Hamlets in London seeing over half of all children living in poverty. It is therefore hardly surprising that the idea of universal basic income is gaining in popularity. But is it the answer?
As appealing as it sounds, a universal basic income will not change the fundamental systemic inequalities in our economy and will not create a work-free utopia. There will still be a prevalent wealth gap between the richest and poorest in our society which a universal basic income fails to address. It will not help the generation of young people excluded from owning, or even renting, a home of their own. Nor will it address the issue of a lack of equality in the workplace where women continue to face a glass ceiling and lower average wages due to entrenched misogyny and unequal opportunities. Furthermore, women from a black or ethnic minority background, or with a disability, or from a deprived background face further barriers to getting the top jobs or a good quality education. The universal basic income has also been mooted as a way of rewarding the unpaid work of women but it could equally reinforce traditional roles in society and prevent greater gender equality.
Our system of welfare is not working. But it can do. Changes should be made to overhaul, simplify and humanise social security and invest in improving skills and productivity so work pays and there is help for those who cannot work. We also need to make sure work pays and have a genuine national living wage for all.
In London, we are currently arguing over whether Uber is leading to the demise of London’s black cabs but the truth is driverless technology poses an entirely different question for those who drive for a living altogether. We should be planning for the new jobs those drivers – and others – need, not rehashing an old idea like UBI. It never took off because it is fundamentally flawed – as the pilot in Finland is likely to find.
We need not be scared of the changing world of work, as long as we are adequately prepared for it. Previous revolutions in work, such as the agrarian and industrial revolutions, have not made human work redundant. They just changed what humans do. The same will be the case for automation. We need to plan for how we are going to support people to thrive in the changing world. This is about a guarantee of equal opportunities and equal rights not a guaranteed equal basic income.
As alluring as it sounds, universal income is not the answer. If it is, you may be asking the wrong question.
Fiona Twycross is a member of the London Assembly
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