As in countries all over the world, a significant effect of the social distancing and other measures that the UK Government has put in place to slow the coronavirus’s spread is that individuals’ incomes are experiencing significant damage. This is particularly true of individuals working in the tourism, hospitality, and leisure industries, and workers on zero hour contracts or in the gig economy. Such income loss impacts both the individuals concerned, and the level of demand in the economy, making a recession a significant risk.
An obvious suggestion, now made frequently in the press and by members of parliament in most of the UK’s political parties, is that a temporary Basic Income – an unconditional income – should be paid to every individual legally resident in the UK.
Unfortunately, this option is not currently open to the UK, because there is no database that could be used for that purpose. There are lots of disconnected lists – driving licence holders, National Insurance numbers, National Health Service numbers, income tax references, passport holders, etc. – but no single list that contains names, contact details, dates of birth, and, crucially, bank account details, for every individual legally resident in the UK.
If the political will were available, government departments and a variety of financial institutions were willing to work together, and the necessary legislation could be passed, then it would not take long for systems analysts to construct the required database: but because the mechanisms that the Government has put in place to protect most workers’ incomes use existing tax and benefits systems, embarking on an emergency Basic Income project that would require a substantial amount of work to create the required administrative systems is not likely to be at the top of the Government’s agenda given the other challenges that it faces.
This is one reason for the Government not implementing a Basic Income to serve the UK’s population during the current crisis. Whether the fact that every other parliamentary party has members calling for a Basic Income is another reason for the Government not wishing to implement a Basic Income must remain a matter for speculation.
Different countries will be better able to construct the required database than the UK, and it would be interesting to know how much work different countries would have to put in in order to do so.
This article is based on two articles on the Citizen’s Basic Income website: