Earlier in the year, Stewart Lansley (Visiting Fellow at the University of Bristol and at City University) and Howard Reed (Director of Landman Economics) co-authored an extensive report on basic income for the British think tank Compass.
As described in the executive summary, “This paper examines the desirability and feasibility of introducing a universal basic income (UBI) scheme in the UK. It examines the merits of such a scheme, how it might be implemented and what role it might play in the search for a good society, one that is more equal, sustainable and democratic. In particular, it presents the results of a number of simulations of how such a scheme would work in practice, including its cost, distributional impact and feasibility.”
More recently, Lansley and Reed summarized their conclusions and policy recommendations–a gradual and incremental approach to the introduction of a UBI–in an article for the London School of Economics blog.
Read more:
Stewart Lansley and Howard Reed (October 13, 2016) “How to make a Universal Basic Income a reality” LSE blog.
Stewart Lansley and Howard Reed (May 2016) “Universal Basic Income: An idea whose time has come?” Compass.
Also see Tyler Prochazka’s Basic Income News exclusive interview with Lansley about the Compass report.
Image CC BY 2.0 Steven Depolo
The UK has a poverty rate of 16.5%[1] for a population of roughly 65mn[2] or around 10.7mn (less if you exclude children). Of course pensioners would be eligible for a top-up. The median wage is about £22K for 2014 and 60% of that is roughly a poverty level of £13K/year. That tallies to about £140bn plus any tapering for a poverty-level tapering citizen’s income. An average couple with 2 children would have £26K/year to make ends meet. The entire UK welfare budget is currently £113.1bn[3] so that would require an additional £30bn plus tapering costs. The only other expense that may be considered would be enhancing residential educational facilities provision[4] in the education budget for orphans and made voluntarily available to single mothers for their children.
Reed and Lansley propose Increasing taxes by £160.6bn for scheme 2 in their document[5]. By their table and in economic terms, this ‘universal’ payment plan provides:
– Working age males: £71/wk or £3692/year (about 30% of a £13K/year poverty threshold)
– Working age females: £71/wk or £3692/year plus an additional £59/wk or £3068/year for each child produced.
Note that with a ‘universal’ income, employers are encouraged to gradually reduce wages by this amount over time. The economic picture is pretty clear to me from both the male and female perspective, as well as that of an Exchequer.
[1] Index Mundi | 2014
[2] WorldoMeters – UK
[3] UK Public Spending Website
[4] Residential Education: An Emerging Resource for Improving Educational Outcomes for Youth in Foster Care? | Lee, Barth | 2009
[5] Universal Basic Income: An idea whose time has come? | Reed, Lansley | 2016