by Stanislas Jourdan | Feb 4, 2016 | News
Long-time supporter of basic income François Blais has been appointed back as Minister of Employment and Social Solidarity and tasked to work on Guaranteed minimum income.
As a consequence of a ministerial reshuffle, François Blais has been displaced from the ministry of Education back to Québec’s Ministry of Employment and Social Solidarity.
Blais had previously been appointed Minister of Employment and Social Solidarity after the April 2014 General Election in Canada’s province. One year ago he was appointed to the Ministry of Education.
“Minister François Blais will work on the improvement of our income support instruments in the direction of a guaranteed minimum income, a field in which he has strong expertise,” Québec’s Prime Minister Philippe Couillard explained in a statement to the press.
“I am serious about it” said Couillard in an interview. “We look at what other countries are doing like in Finland. I find the idea very seductive.”
“On the one hand it simplifies the State, on the other it maintains people’s dignity. The combinaison is excessively interesting.”
Blais is BIEN member since the 1990s. He investigated the concept while holding the post of Professor of Political Science at Laval University, Québec City. In 2002 he co-wrote a book entitled Ending Poverty: A Basic Income for All Canadians, and he reiterated his support for basic income when he joined the government in 2014.
“A perfect political storm”
The ministry reshuffle may indicate a change of direction for the liberal government led by Couillard. Blais’ predecessor Sam Hamad has been pushing a reform which would involve more sanctions to unemployed people who would refuse job opportunities. The bill has sparked a lot of criticism among anti-poverty group and leftist parties in Québec.
“It’s the perfect political storm and Quebec is in the unique position to lead what could be the most fundamental change in western social policy since the introduction of medicare.” comments Peter Wheeland on CultMontreal.com.
Blais’s reappointment however does not make unanimity. In particular, the Left-Independentist and pro-basic income party Québec Solidaire expressed its concerns with the return of Blais to the Ministry for Social Affairs. Blais himself was heavily criticized during his first mandate as Minister for pushing cuts in social benefits.
by Matthias Lindemer | Dec 7, 2015 | Opinion
By Che Wagner
Originally published in German in the Swiss online newspaper Tages Woche.
Translated by Matthias Lindemer for Basic Income News.
(Photo shows activists of the Swiss Basic Income Initiative with a banner inside a vault. Credit: Stefan Bohrer)
On Wednesday, September 23, 2015, the Swiss parliament debated a popular petition for an unconditional basic income. Enough signatures were collected to grant a national referendum. The parliamentarians seemed to compete to voice the most incendiary expressions. “The most dangerous initiative ever!” said Sebastian Frehner of the Swiss People’s Party (SVP). “A released grenade in our hands!” said Daniel Stolz of the Liberal Democratic Party (FDP).
The reactions to the initiative were stamped with fear. If you want to avoid danger, it is better for you not to move. Bernhard Guhl, speaking on behalf of the centrist Conservative Democratic Party (BDP), exhorted “Don’t endanger our prosperity!” The parties right of center, like the SVP, sounded even more dramatic. Peter Keller (SVP) declared, “You don’t even care who will be paying for that,” and Sebastian Frehner (SVP) argued that the Basic Income would swallow all of the country’s money and spell “the end of Switzerland.”
“The most dangerous initiative ever!” (Sebastian Frehner, SVP)
Where does the fear come from? Some of it stems from the worry that a basic income will make all of its recipients lazy. Keller, for example, called the proposal “a slap in the face of all the people getting up at 6 for work in the morning.” Others worried that the financial burden would render a basic income entirely impossible.
Behind these fears, however, lurked a quiet consensus: the question of whether a basic income is financeable is only a matter of political will.
What if there is a basic income and the people refuse participation in the workforce? There will be no more value-creation, and thus no more tax revenue, and thus no basic income. According to the politicians, the basic danger comes from human beings themselves; because of human “laziness”, the freedom of decision allowed by a basic income could be dangerous.
“The referendum result will tell us if the Swiss people fear themselves too.” (Che Wagner)
Not all Swiss politicians share these fears. Cédric Wermuth of the Social Democratic Paty (SP), who endorses a basic income, believes that the proposal represents the best defense against the rise of a neoliberal storm. Andi Gross (SP), who will soon go out of office, adds, “basic income is a shift of power from capital to activity.”
In general, parliamentarians on the left seemed less frightened by the alleged danger. According to those on the left, the main drawback to a basic income is that it could be misunderstood. Swiss citizens, for example, might mistake it for a “housewife subsidy,” encouraging couples to live a traditional way of life where the wife stay at home. Or they might mistake it for a social “parking lot” for people who have no chance of finding a job.
“Basic income is a shift of power from capital to activity.”
(Andi Gross, SP)
These “dangers” all come from the same source: human nature. According to critics, people would misuse a basic income grant and live in ways that go against the expected norm.
At the end of the long day of debate, the parliamentarians voted 146 to 14 against the basic income petition. This vote, however, might reflect the influence of the upcoming referendum, as politicians tend to hesitate to stick their necks out too far. However, even while the overwhelming majority of politicians reject a basic income, an impressive proportion of the Swiss people support it. A poll in the newspaper Tages-Anzeiger, for instance, indicated that 49% of the public supports a basic income.
Despite the fear and negative vote, the debate marked progress in the movement for a basic income. As Alain Berset of the Swiss Federal Council remarked, the possibility even to debate this idea in the parliament of Switzerland is “of great value.”
The Council of States will debate the basic income initiative this winter. Then, in autumn 2016, the decision will fall to the Swiss citizens. The political class has identified its fear: the Swiss people and the danger of a “laziness” epidemic.
The referendum result will tell us if the Swiss people fear themselves too.
Che Wagner studied economic history. He is the director of the referendum campaign for a Basic Income in Switzerland.
by Citizens' Income Trust | May 24, 2015 | Opinion
Donald Hirsch, ‘Could a Citizen’s Income work?’ A paper commissioned by the Joseph Rowntree Foundation as part of its Minimum Income Standard programme, and published in March 2015. www.jrf.org.uk/publications/could-citizens-income-work
The Citizen’s Income Newsletter usually mentions relevant think tank research and working papers in the ‘news’ section, or occasionally in the context of an editorial, but Donald Hirsch’s paper is particularly significant and so demands a full review. Its importance is twofold: it evaluates a number of Citizen’s Income schemes for viability; and it identifies the changes that might be required in the ways in which the public and policymakers think about income maintenance if a Citizen’s Income were to be a possibility. The paper therefore tackles a number of different feasibilities: financial feasibility, psychological feasibility, and what we might call institutional or policy process feasibility.
The paper recognises that a Citizen’s Income would address some very real problems experienced by the UK’s current largely means-tested benefits system. For instance: a Citizen’s Income would not be withdrawn as earnings rose, and so would not impose the employment disincentives that means-tested benefits currently impose; no stigma would be attached to a Citizen’s Income; and a Citizen’s Income would be simple in structure and so would not suffer from the complexities of much of the current system. The full list of arguments on page 4 of the paper is a model summary of the case for a Citizen’s Income.
The major contribution of the paper is the way in which it outlines the three ‘seismic shifts’ that would need to occur in public attitudes if a Citizen’s Income were to be implemented. The public and policymakers would need to be convinced
- ‘that everyone should be given some baseline level of financial support from the state, even if they choose not to do anything to try to earn money for themselves;’ (p.5)
- ‘that the basic marginal tax rate should be substantially higher than it now is, since otherwise almost everybody’s net income from the state would rise, and there is no obvious way to finance this.’ (p.5)
- ‘potentially a reduced role of the state in ensuring that each citizen can afford particular essentials, notably housing and childcare, through income transfers, if a citizen’s income replaced means-tested payments for these.’ (p.3)
Hirsch says of the first two of these seismic shifts:
Politicians are likely to perceive both of these as unacceptable to voters, a view supported by evidence on social attitudes. It can be argued that both of these conditions could become more acceptable under a regime with a citizen’s income than they are now. Persuading the public and politicians of these arguments, however, would not be easy. (p.5)
And he says of the third:
Under a system of largely market-based rents, it would not be easy to include a simple rent element in a citizen’s income payment without creating shortfalls for some or large surpluses for others. (p.5)
Particularly in relation to the first two seismic shifts, Hirsch’s conclusion is that ‘a debate about the principle of a citizen’s income may thus contribute to a long-term reconsideration of policies and attitudes towards state support’ (p.3).
The paper contains a useful study of the differences between Universal Credit, Negative Income Tax, and Citizen’s Income; a discussion of the ways in which Income Tax would have to rise to pay for different levels of Citizen’s Income; an exploration of the different ways in which Citizen’s Income schemes might tackle differing housing costs; and a discussion of the way in which abolishing tax allowances, such as the Personal Allowance, rather than simply raising Income Tax rates, could pay for a Citizen’s Income. It also contains a description of the differences between the levels envisaged in various researched schemes and the Minimum Income Standards researched by the Joseph Rowntree Foundation ( – although it has to be said, of course, that the current benefits system does not come anywhere near to the levels of the Minimum Income Standards). Then follow descriptions of the kinds of households to which a Citizen’s Income would tend to redistribute income, and the important statement that ‘all the [paper’s] calculations make the simplified assumption of no behavioural change. Knowing what would actually happen to earned incomes as a result of a citizen’s income is very difficult, but is likely to affect outcomes quite profoundly’ (p.16). Then come discussions of household and individual assessment units, the effects of different approaches to meeting housing costs, and lifecycle redistribution. A particularly important section is a discussion of a Partial Citizen’s Income as a stepping stone towards a full one. A partial Citizen’s Income would be likely to impose losses on low income families if means-tested benefits were abolished, and to impose additional complexity if they were not. Hirsch suggests that a Partial Citizen’s Income might be useful if it could be implemented as one stage of an already agreed plan to implement a full Citizen’s Income. There is much merit in this suggestion.
Hirsch describes the Alaska Permanent Fund, and the Namibian and Iranian schemes, but not the more recent Indian pilot project. He correctly points out that these schemes have not reduced employment market activity, and might also have said that in the Namibian pilot project a significant increase was in evidence.
Hirsch makes the important point that income is different from such services as healthcare and education because households generate income as well as require it. This means that it is important to ensure that a Citizen’s Income scheme does not inadvertently reduce the amount of income created, and that both removal of the Personal Tax Allowance and higher Income Tax rates might have such effects on earned incomes. In his concluding section, Hirsch suggests that a Universal Credit with a lower taper rate might be a useful step in the direction of a Citizen’s Income. He might also have pointed out that Universal Credit is not universal, is not based on the individual, is not unconditional, is still means-tested, and is regressive.
When it comes to the study of particular Citizen’s Income schemes in the paper’s appendices, the paper makes two valid points: that the immediate implementation of a ‘full’ Citizen’s Income is unlikely to be feasible in the short term; and that, because a ‘partial’ Citizen’s Income would not fully replace means-tested benefits, it could make the system even more complicated.
Following a description of the Citizen’s Income Trust’s 2013 illustrative scheme, Hirsch proposes changes and lists their additional costs, which is useful, but is not itself a criticism of the scheme as published. He then studies the Institute for Social and Economic Research working paper proposals (reprinted in the previous edition of this Newsletter), and correctly recognises that in order to reduce losses in disposable income, a means-tested system needs to be retained and that this would create an additional level of complexity.
Hirsch’s descriptions of these recently researched Citizen’s Income schemes are largely accurate. There are places in the discussion at which a broader canvas would have been helpful. For instance, the discussion of the higher rates of Income Tax that would be required might have included consideration of overall gains and losses – for if a household’s Income Tax rate rises, but the overall effect of the Citizen’s Income, increased Income Tax, and alterations in other benefits, leaves the household with the same disposable income, then for households originally on in-work or out-of-work means-tested benefits, it really is no problem that Income Tax rates have risen – except that, as Hirsch correctly points out, Income Tax rates are a psychological issue as well as a fiscal one: and it is in the area of the psychological issues related to Citizen’s Income that his paper makes a most useful contribution. An additional important issue is that where households are not currently on means-tested benefits, and Income Tax rates rise, then even if there is no overall loss in disposable income at the point of implementation of a Citizen’s Income, those households’ marginal deduction rates will rise. This might result in behavioural change in the employment market.
A further issue to which Hirsch correctly draws attention is that of redistribution. For schemes in which means-tested benefits are abolished, redistribution effects could be substantial. Hirsch evaluates a particular scheme of this nature, and concludes that
the overall distributional effects would include, but not be restricted to, a redistribution of income from better to worse off groups. There would also be a significant redistribution from people without children to those with children among lower earners, and also some losses for those with very low part-time earnings. Finally, … among groups presently receiving transfers from the state, couples would do relatively better than single adults (with and without children). (p.15)
So either such redistributional effects would need to be justified, or a different kind of scheme would need to be selected. Hirsch does not study in detail the redistributional effects of Citizen’s Income schemes that retain means-tested benefits, where those means-tested benefits are recalculated by taking into account households’ Citizen’s Incomes as existing income. This would require the kind of microsimulation work contained in the Institute for Social and Economic Research working paper (Torry, 2015). The low levels of gains and losses generated by such modelling of the alternative schemes in that working paper suggest that redistributional effects would be far less significant than for schemes that abolish means-tested benefits. Clearly further research is needed in this area.
In relation to those same alternative schemes, and to his discussion of housing costs on p.13, Hirsch might have mentioned that the schemes researched in the 2015 Institute for Social and Economic Research working paper are clear that housing costs support would be left as it is under the current system. A further issue that Hirsch might have discussed is that the ISER paper employed the Euromod modelling software and Family Resource Survey data to generate entirely robust costings and results on gains and losses. As he recognises on p.26, his own paper does not calculate precise tax rates and income outcomes. It would have been able to do so if his suggestions had been modelled using Euromod.
This review cannot do proper justice to the detail contained in Hirsch’s well-researched and well-ordered paper, but we hope that it will encourage our readers to read his paper for themselves, to study his arguments, and to ponder his conclusions. Any future study of the feasibility of a Citizen’s Income, and of particular Citizen’s Income schemes, could do a lot worse than set out from the arguments of this paper.
Hirsch has already done the Citizen’s Income debate a significant service, and we hope to see further such analysis and argument in the future. What would be particularly useful would be to have a side-by-side evaluation of the current benefits system and of a Citizen’s Income scheme (both with and without accompanying means-tested benefits), treating the two systems as competitors on a level playing field, and evaluating them according to a set of clear criteria. As Hirsch says,
the present system suffers from strong negative perceptions and a consequent lack of political support, which has helped the implementation of recent cuts in the real value of benefit levels without obvious political fallout. If a citizen’s income or any other reform could command public confidence, this would help strengthen the underpinning of a system which ensures that nobody in the UK lacks a basic level of income. (pp.4-5)
