To think a basic income/citizens wage is a blinding idea?

[Littlefluffyclouds81]

For anyone unfamiliar with the concept, the idea is that each adult citizen, regardless of their working status, money in the bank etc, gets a basic amount of money for free, each month, for example £1000.

Sounds a bit nuts, but bear with me.

The benefits would be that everyone, whether they are homeless, or whatever, knows they have the security of this money coming in each month. There are no costly administrative procedures in determining whether someone is eligible for benefits, or sanctions for those who break the rules.

But, surely everyone will just sit on their arses and not work? Well no, because actually most people have an innate desire to be successful and do well, and let's face it no one is going to be living the high life on a grand a month. It would actually get people out of the benefits trap, because as it stands people are hesitant to come of benefits because if the job doesn't work out, they have to start their claim all over again, or they might have worked out that they would be hardly anything better off by working, so it's not really worth it. With a basic income, they could work as much as they liked knowing that they will still have this money behind them.

So how will it be paid for? Once you have removed the humongous costs of means-testing benefits, and assessing fitness for work with disability benefits, and all that, well that's the government a good few quid up, right there. Also bear in mind that the fund currently used to pay benefits would just be transferred to pay basic income. Raise corporation tax which the coalition sneaked down, and maybe a little bit more tax for the very highest earners, and that's job done.

The theory is, that as it stands, a lot of people have nothing. They are scraping by on the bare minimum of benefits, living in fear of sanctions and being forced into work fare. This way, people would have options, they would all of a sudden have opportunities in front of them to do courses, move to better accommodation, or whatever they needed. It would give people hope. The stigma of being 'on benefits' would be gone, as it would be universalistic. Equality would be massively improved, and with it so would would wellbeing, and health, which would also save the government millions.

I realise with the latest turn of political events there is approximately no chance of this happening, but I think it makes a bucket load of sense.

Lovely idea but the economics of it do not work. As has been shown oN this thread.

And there is not such word as 'universalistic'. The one you're searching for is UNIVERSAL.

I did a project once for a government (not Spain or the UK) about what a flat rate of income tax might look like.

We tried every permutation of minimum income, tax rate and tax reliefs we could think of - and we simply couldn't make it work. No matter what we did, we couldn't find a flat rate that brought in enough money without making the poorest sections of the population (those that don't currently pay tax either because their earnings are too low and/or because the benefits the receive aren't taxable) significantly worse off.

What about people who aren't citizens, but live here full time?

My husband is disabled and can't work, I am his carer and I also look after our DD at home.

I am entitled to apply for citizenship, but we can't afford it.

Under your system I wouldn't be entitled to any benefits and we certainly wouldn't be able to survive on £12,000 a year.

The website the OP linked to upthread suggested a partial citizen's income rate in line with 2011 levels of JSA, for those of working age. Prior to that it'd be less. This is because a full income would be too costly. So more like £200 a month than a grand!

I don't think that's a disincentive to work. I also think it'd make the work or childcare decision made by many mothers at the end of mat leave more straightforward.

Cinnabar's points are very interesting though.

And if we think immigration and people coming to the UK for its benefits is bad now, just think what it would be like if everyone got £1000 a month!

Terrible idea. Haven't read the thread, no time, but I'm sure posters would have mentioned disability, umpteen dc, regional cost variations, how much time do you have to spend here to get the grand? Turn up on the 1st, get the money, then go on holiday abroad? I could go on. Nonsense idea.

juneau

There is, I'm afraid. Bandied around in social policy rather a lot, I think you'll find.

www.thefreedictionary.com/universalistic

Also Juneau, there are many countries where we would get better benefits than than the UK. For example France: 35 hour working weeks, extra holiday accrued on overtime, between 6-10 weeks off paid a year, an extra week off paid if you get married, government funded nannies for 8 hours a week for every woman who gives birth, very generous family benefits.

We're all still here though, not in France.

Another number to compare it to - if it helps - the UK's GDP (how much the country earns) is around £1.8 trillion per annum.

So this proposal would effectively be a 75% tax charge on the country.

It makes sense in some ways but unemployed, disabled people and carers would still need additional benefits.

It may have the opposite affect on low paid work, more people may choose to do it as they would be on a higher income overall regardless of actual earnings. Not everyone in a low paid job lacks a work ethic.

I am a bit cynical about this as any spare income seems to get gobbled up by private landlords who would increase their rents in accordance with the univeral benefit meaning it would end up in their pockets anyway. This could have a knock on effect on house prices too.

Electricity and gas companies would shove the prices up again no doubt.

Before you know it, prices of everything would be up and no one would be any better off.

Oops forgot to add free childcare to that list too.

I don't want to just be a nay-sayer - I absolutely agree that the current system is broken. But it needs to be replaced by something we can afford.
How about:

1. A living wage for all employees - it should be the minimum, not an aspiration.

1. A time phased reduction in benefits for people who get back into work so that they have some time to become financially independent before their benefits are reduced. And once the time comes for benefits to be reduced, make it a gentler reduction than is currently the case. The effective tax rate for someone going from unemployment to working is around 85%, because of their benefits being phased out. Where's the incentive there?

kitzac the unemployed wouldn't need an extra money as they would be receiving enough to live on through the basic income. I agree with you that there are plenty of people with a work ethic - I wouldnt be content getting by on just enough to survive, with no prospect of holidays etc.

You've made some really good points, Cinnebar .

The problem is, as disgusting as it sounds, foodbanks and soup kitchens are a much more economical way of keeping a poor population from starving to death. It's the self same economics of those supermarkets who are giving away their out of date sandwiches, rather than pouring blue paint over them. It's the economics of the workhouse. Of course it's evil if you're queuing at the soup kitchen, with a tin bowl. But, the Tory economists are delighted.

Because cinnebar, unemployment benefits are a gnat on an elephant's ass compared with state pensions.

JSA 5bn
SPens 74bn

All this crap about benefits is just right wing horse shit.

Because cinnebar, unemployment benefits are a gnat on an elephant's ass compared with state pensions.

JSA 5bn
SPens 74bn

All this crap about benefits is just right wing horse shit.

I realise that's more economical, Dora. But with a starting point of having something, you can use that to make something more. For example, I have spent out just £600 on stock for my business, and now have stock worth nearly 20k, which doesn't include everything I've sold, which is a fair bit. Without the £600 I couldn't have done that. People living on jobseekers aren't going to be able to find a spare £600. It wasn't possible for me when I was studying an access course and literally down to my last quid every week, with no money to get electric. But once I got student finance, I was able to spare money to be able to generate more money. I'm sure I'm not alone in having that mentality.

?
I can see that the disincentive to work is a problem, but is it not also a problem that, in a modern technologically advanced society there is not enough useful and productive work to go around.
This is likely to increasingly become the case as more and more jobs are done by robots and computers.
We will need to find new ways of allocating resources ?

Are alcoholics exempt? Gamblers?

All this crap about benefits is just right wing horse shit.

As opposed a 'citizens wage' of £1000, which is left-wing horseshit.

How many people do you think would simply opt out of the workforce if they were given a wage like this? I'm guessing that pretty much EVERYONE on a low income would, because why wouldn't you? If you can make MORE money than you're on now by doing nothing, what incentive do you have to do anything? And if the tax revenues now wouldn't make this crazy plan feasible, how would they look after millions of people simply opted out of work? That's the problem with projecting into the future based on the current status quo - if you make a huge change such as this to people's family incomes they are going to make vastly different choices (and probably opt out of the workforce altogether).

CinnarbarRed

Thank you for the figures upthread. It is very helpful to know.

I live in Scotland and was horrified by the lack of financial responsibility / planning that was evident from the SNP during their Independence campaign last year.

Can you describe the figures for Scotland (as a stand alone nation) please?

Sorry Dora I really disagree with you.

The upfront cost of soup kitchens and foodbanks is undoubtedly less, but the ongoing costs of extreme poverty are a lesson in false economies. Chances are if you're extremely poor you're also living in poor housing, eating a poor diet and stressing your body in other ways that all mean a knock on cost for the NHS.

Cinnebar you're absolutely right to want to start with a living wage, I think it's shameful that taxpayers have to subsidise low wages through tax credits etc. However I wonder how many businesses can really afford it?

Free, or heavily subsidised childcare as in France would be a huge benefit to so many.

I agree that JSA is only one small part of the benefits bill. But it's also not the only benefit which starts to erode once someone starts working.

Total social security benefits in 2013/14 were £180bn. This includes state pensions (other than the net state pension paid to public sector workers, which is accounted for separately) and all benefits, including central support for housing.

Tax credits in 2013/14 were £29bn, paid to earners.

www.gov.uk/government/uploads/system/uploads/attachment_data/file/330717/PESA_2014_-_print.pdf

I am a left-winger, BTW.