Scrap Benefits and pay every adult, working, non working or retired, an unconditional basic income of £15,000 a year? Discuss

(332 Posts)
CorruptBstard Wed 04-Jul-12 15:35:15


Ok Mumsnet, what do you think of this?

Pay every adult in the uk £15,000 a year, with no conditions attached, so that every adult is free to use their time to do stuff, just for the love of it.

This basic income would cover basic needs for food and shelter, if people wanted to earn more money they could go and work for someone else or start a business of their own

This would abolish poverty in one fell swoop.

Wheres the money coming from to pay for it?

well apart from scrapping all "state benefits", we could also scrap income tax and fund it all by taxing money every time its spent.

ie Government gives me £5. I pass that £5 round a group of 10 friends. By the time the £5 comes back to me, it has been "spent" 10 times. Creating a turnover of £50. If the government taxes that spending at 20%, it raises £10 in tax. Making a profit of £5.


If you recieved £15,000 a year unconditionally, what would you do just for the love of it?

It would just cause inflation.

It would be better if everybody got a basic income but had to work to get it, in the community, and they felt they had earned their money, rather than just being given it.

Enough people already think they are entitled to something for nothing in this country. It would only make that worse.

CorruptBstard Wed 04-Jul-12 16:36:57

emmile you make some very very good points thanks

Chubfuddler Wed 04-Jul-12 16:37:55

QE causes inflation. The declared rate of inflation is massaged by not including lots and lots of things in it. If you think giving everyone 15k won't devalue the currency and cause hyper inflation, well. Words fail me really.

CorruptBstard Wed 04-Jul-12 16:38:09


why would "free money" cause rampant inflation whereas working for a basic income wouldnt?

JugglingWithTangentialOranges Wed 04-Jul-12 16:39:07

Sounds great !

If it is green party policy then that's one more reason to vote for them in my book.

I'd still work with children and families to earn more. Might even set up my own business if it wasn't all so incredibly complicated !

Tax credits seem very complicated/ never quite seem to cope with my ever changing work situation (especially over last year) Will have to give them an estimate of how much I've earned this year as I've had 3 jobs. Gets complicated for me and them.

In Qatar the government does something similar to this, but only for Qatari nationals, every Qatari national has a job and a wage paid by the government that is very very substantial.

But that's what the richest country in the world can afford to do with a population of less that 300,000

EmilieFloge Wed 04-Jul-12 16:44:32

What if just housing was free...if everyone could get a council house...I don't know. Or if it was affordable for the majority rather than just those who already receive benefits - people who work above the line should be able to get cheap enough housing too.

That would transform a lot of lives and take away a lot of resentment imo. I feel guilty for getting HB when others have to struggle to pay a mortgage. Really guilty.

AmberLeaf Wed 04-Jul-12 16:46:34

What about people who are carers for a disabled child and so can't due to caring responsibilities do the 'extra' work to increase their income?

I'm assuming your scrapping of benefits includes those paid to help with the higher costs of living with a disability?

So you will have groups of people who never have the opportunity to earn more/live more comfortably.

As a single parent of 3 with one disabled child who's care needs prevent me from working I'd be worse off under your proposal.

I can see why it could work for some.

The Qatari government don't just give their employees enough to cover basic living costs, they give them enough to live very well indeed. Of course they ship in cheap labour from India and Asia to do all the dirty work and manual labour in the country.

CorruptBstard Wed 04-Jul-12 16:47:51


VAT works in the same way.

yes money is created out of nothing. thats what "quantative easing" is, thats where the "bank bailout" money comes from, thats how banks create money using "fractional reserve lending"

think about his.

if i could get all the money currently in the world, every single penny and put it in your bank account, and you then lend all that money back to me at an interest rate of 10%. then ask me for the money back. i can give you all the money you lend me, but where do i get the money to pay you the 10% interest you charge?

the money you gave me is all the money there is so i cant pay the interest.

thats what banks do when they lend money at interest, they are asking for money to be paid back that doesnt exist. to remedy this problem they then create it from nothing, and lend it to the debtor, so the debtor can to the interest. they obviously lend that money at interest too.

its genius, and we all fall for it, you gotta hand it to them really ;-)

CorruptBstard Wed 04-Jul-12 16:49:41

chubfudder, so what would happen if we created jobs for everyone and paid them minimum of £15k a year? rampant inflation?

Chubfuddler Wed 04-Jul-12 16:55:49

I actually don't understand a word you are saying. And believe me that's not because I am stupid.

Chubfuddler Wed 04-Jul-12 16:56:25

"vat works in the same way"

No it doesn't.

Chubfuddler Wed 04-Jul-12 16:57:27

You know that whole creating money from nothing nonsense you're banging on about? That's inflation. Right there.

merrymouse Wed 04-Jul-12 17:17:50

Nope, I agree, vat does not work like that. Money is generated by supplying a service or making something out of raw materials that is of greater value than the raw materials and then trading.

merrymouse Wed 04-Jul-12 17:18:56

Passing a fiver around just makes it a bit crumpled and grubby.

MrJudgeyPants Wed 04-Jul-12 17:31:55

I would be broadly supportive of such a system but think that £15k is far too much. Moving away from 'magic money tree' economics, where no taxes need to rise in order to pay for things, what do the numbers show?

Well 15000 multiplied by the number of over 18's in the UK (approx. 50 million) gives us...

750 BILLION pounds.

To put that into perspective, we currently spend around £225 billion on welfare and housing benefits.

So, to pay a 'national allowance' of £15k per year, the chancellor will have to up taxes by half a trillion quid or so! That just isn't going to happen any time soon.


How about a National Allowance of around £5k payable to everyone (more for the disabled, obviously), total scrapping of all other benefits / housing allowances etc., and a free market solution whereby the allowance can be borrowed against (up to a certain threshold - say 300%) to get people through difficult times such as short term unemployment, or to help start up a business or pay for university fees etc. When not needed, the money could be put towards purchasing further pension provision or just taken as cash and spent.

This would be cost neutral, solve the pension’s crisis, give everyone a handy line of credit, boost the economy, give an incentive for the unemployed get back into work and even help out the banks.

What's not to like???

somebloke123 Wed 04-Jul-12 18:03:33

It's called Citizens' Basic Income isn't it?

I think it has much to be said for it but I can't see how it could be anything like £15000 pa. £6000 perhaps, £7500 max.

Then abolish the old age pension (they get the CBI same as everyone else so it's the same or higher income under a different name.) Also abolish the minimum wage. Massively restrict other benefits.

On top of the CBI people can earn what they want at a standard flat rate of, say 25%.

It has the virtue of massive simplicity. Also it abolishes the poverty trap since it is never not in someone's financial interest to work, as it is now, where some people face effective marginal tax rates of over 90% if they get a job as they lose in benefits almost as fast as they earn extra.

The genuinely sick or inform would of course get additional support.

CorruptBstard Wed 04-Jul-12 20:45:23

Chubfuddler & merrymouse. VAT is a tax on sales. Money is created by banks lending it at interest into society and is created by lending depositors money to debtors. It'd called "fractional reserve lending"

Take the Mic of my "pass the £5 note" example by all means, but you haven't explained why it doesn't work. Spending creates turnover, tax the turnover. VAT is a tax on turnover of a small amount if goods and raises almost £100 billion in tax already. I'm proposing widely increasing the amount of sales that can be taxed, therefore reducing the tax in % terms and increasing actual revenue.

All explained here

Mr judgypants where did we find the £350 billion we've recently bailed out the banks with, and "quantitatively eased" into the economy?

Chubfuddler Wed 04-Jul-12 20:52:53

It is so obvious why it doesn't work I'm amazed it needs spelling out.

Your fiver is passed to me. I pay 20% on it. So I have four quid. I pass on four quid. The recipient pays 80p. They have three pound twenty. They pass it on. The recipient pays 64p. Need I go on?

merrymouse Wed 04-Jul-12 21:21:36

corrupt bastard, VAT is a tax on 'added value' borne by the final, non VAT registered, consumer.

1) VAT registered wood cutter grows tree and sells wood at £10 and charges 20% VAT so £12
2) VAT registered table maker buys wood at £12, claims back VAT £2, makes table and sells to shop for £20 + VAT of £4.
3) VAT registered shop buys table for £24 and claims back VAT of £4.
4) Customer buys table for £40 + VAT of £8.

HMRC only receive any money if somebody adds value, not if they simply pass money around. If they all just charged each other £10, HMRC wouldn't make any more than the original £2.

merrymouse Wed 04-Jul-12 21:40:27


Money isn't created by banks, except in the sense that the royal mint makes money. Money represents a communal way of measuring the value of goods and services.

Banks are businesses that make money by providing a service that people require - the market decides the value of the things that people spend money on, not the banks.

Obviously banks can make decisions that effect exchange rates and interest rates. However, they can't create a value that isn't there. (They might attempt to do this and succeed for a little while, but generally this all ends in tears).

merrymouse Wed 04-Jul-12 21:58:57

To explain the inflation thing...

All the money in the world is £10 and there are 10 pineapples which are worth all the money in the world, so each pineapple costs £1.

You, lend me £10 to buy all the pineapples and charge me £2 interest.

The £2 doesn't exist!

But great, you have just created 2 £1 coins and you lend them to me - fabulous!


The pineapples are still worth all the money in the world, so they are now worth £1.20 each. I now need the £12 just to the buy the pineapples, and don't have any money to pay you back your interest.

Now, I could say to the pineapple seller "I can't afford to pay you £12, but I am the only person who wants your pineapples, so if you want the money now, I'm going to have to pay £10".

However, this deal hasn't 'created more money', it has reduced the value of the pineapples, so that the middle man (the banker) can be paid his £2 and take his cut in return for speeding up the flow of money through the economy.

CorruptBstard Wed 04-Jul-12 22:23:45

Chubfuddler. See merrymouse explanation of VAT. Selling a table for £40 raises £8 in tax. Leaving table seller with £32 if he buys something as end VAT user he pays the VAT on that meaning the new seller recieved something like £26. You see where I'm heading here? Under VAT the money should also "disappear' but it doesn't does it. So why would it with a full sales tax?

Merrymouse do you understand what fractional reserve lending is and how it works?

Finally. I am giving you my answers to your questions, so would you answer one for me. If I gave both of you £15k basic income, index linked to inflation every year for life. What would you do with your time?

Chubfuddler Wed 04-Jul-12 22:27:34

I understand merry mouse perfectly. It's your nonsense about passing a fiver round I don't get.

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