universal basic income

Following up on my earlier 2019/03/universal-basic-income blog, I just looked up "universal basic income" on the websites of the three big welfare rights charities I used to work for: CPAG, DRUK and Working Families. Searching for "universal basic income" at cpag.org.uk and workingfamilies.org.uk yields no results, while disabilityrightsuk.org does best with its round-up, 18 March 2019, of two new reports about Universal Basic Income. 

The two reports are set against the background of another recent report, which is by Disabled People Against the Cuts (DPAC), UBI: Solution or Illusion? This notes that UBI, by itself, would never cover the additional costs of disability or be too expensive and difficult to distribute. This means that, with any UBI scheme, it is likely that additional payments would remain part of a benefit system. DPAC say:

The Citizens’ Income Trust, one of the major supporters of a basic (or “citizens” income) in the UK, now advocate that both disability and housing benefits would need to remain outside a model of UBI – which would mean continuing assessments and, potentially, conditionality for disabled people. (emphasis added)

DRUK say that the two new reports

are not really concerned with financial support for disabled people - which raises questions about inclusivity. Instead, they rely on a parallel benefits scheme to paper the cracks in a UBI system.

Report 1: Basic Income for All: From Desirability to Feasibility

This report by Compass offers two models:

Model 1, the fast track route

Under this model the government would pay £60 per week to adults aged 18–64, £40 per week to mothers for each of their children (aged 0–17), and £175 to adults aged 65+. Eligibility would be based on residency. Child benefit and the state pension would be abolished, but other parts of the existing social security system, including means-tested benefits, would be retained. These sums would be guaranteed, with no questions asked, irrespective of work status.

Model 2, the slow track route

This model would boost the long-term funding for a basic income scheme by creating a targeted citizens’ wealth, which could gradually improve basic income payment levels over time.

• Advantage for disabled people - means-tested benefits being awarded with no questions asked, irrespective of work status.
• Disadvantage for disabled people – The report seeks to postpone disability and housing costs issues till  a later date, with no detail.

Report 2: Nothing Personal: Replacing the personal tax allowance with a weekly national allowance

This report by New Economics Foundation proposes giving people a £48.08 “weekly national allowance,” to every adult over the age of 18 earning less than £125,000 a year. The cash would not replace benefits and would not depend on employment.

The weekly payments would be fully funded by the abolition of the tax-free personal allowance.

The policy idea has been welcomed by the shadow chancellor, John McDonnell, and the Green MP Caroline Lucas. 

• Advantage for disabled people – The report claims 88% of all adults would see their post-tax income rise or stay the same, helping to lift 200,000 families across the country out of poverty. Those on benefits, who see little or no gain from tax personal allowances would see a rise in income. The money is on top of the existing payments system and there may also be gains if you are working and getting universal credit.
• Disadvantage for disabled people – There are no proposals which address the inadequacy of the current benefit system both financially and in terms of the disability tests.