by Kate McFarland | Sep 28, 2017 | News
The Institute for Policy Research at the University of Bath, which has published a series of reports on the feasibility and implementation of basic income, commissioned a recently published survey on attitudes towards basic income in the UK.
The survey was conducted by the British market research organization Ipsos MORI, who interviewed a sample 1,111 individuals from the UK population aged 18 to 75. Interviews were conducted online in August 2017. In the recently published results, the survey data are weighted to represent the general UK population according to age, gender, region, employment status, social grade, and educational attainment.
In a series of three multi-part questions, Ipsos MORI queried respondents about their views on universal basic income (UBI), which it defined, similarly to BIEN, as “a regular income paid in cash to every individual adult in the UK, regardless of their working status and income from other sources In other words, it would be: universal (i.e. paid to all), unconditional (i.e. paid without a requirement to work); and paid to individuals (rather than to a household).”
Interviewees were also instructed to assume, for the purposes of the survey, that the amount of the UBI “would be set roughly at the amount the UK government judged to be necessary to cover basic needs, e.g. food and clothing (but not housing costs).”
Before laying out the description of UBI, the survey questionnaire additional mentioned, “As you may be aware, some countries are considering introducing a basic income.”
Results
Asked whether they would support UBI described as above, 49% of respondents replied affirmatively (15% “strongly support” and 33% “tend to support”), while 26% replied negatively (17% “strongly oppose” and 9% “tend to oppose”).
Reported levels of support decreased substantially, however, when funding mechanisms were specified. Only 30% would support UBI if it entailed an increase in taxes, with 40% opposing UBI in this case. Meanwhile, 37% would support, and 30% would oppose, a UBI funded by cuts on spending on current welfare benefits. If both funding mechanisms were put into place, support for UBI decreases to 22%, while opposition increases to 47%.
The preceding result is similar to what was observed in a 2016 poll conducted by Canada’s Angus Reid Institute, which saw that respondents tended to favor basic income in principle, but would not support an increase in taxes to fund it in their country.
In the second question, respondents were asked “Regardless of whether you support or oppose the UK Government introducing a basic income, which of the following, if any, would be your most preferred way of mainly funding a basic income, if it was introduced?” Options included “increasing taxes on wealth” (34% favored), “cutting existing welfare benefits” (28% favored), “raising income tax” (12% favored), and “other” (3% favored).
The second part of this question broadens the definition of a “basic income scheme” from the initial definition, asking respondents if they would support such as program if certain compromises were made to universality and unconditionality. More than half of respondents replied that they would support a policy “only paid to those who are in work, in training, doing voluntary work, or pensioners” (52% strongly support or tend to support) or one “only paid to those on low incomes” (57% strongly support or tend to support), with only 18% and 17%, respectively, reporting opposition to the policies. (It should be noted, however, that it would conflict with most established uses of the term–including that of BIEN–to call such a policy a “basic income” scheme.)
Support decreased if the program were only to benefit young people (aged 18 to 24) “who are in work, full time education, or in training”: 35% would support (or tend to support) such a program, while 33% would oppose (or tend to oppose) it.
The third and final question queried interviewees on the “how convincing” they personally found each of six arguments that have been made in favor of basic income. The results tentatively suggest that, among British adults, arguments that emphasize the ability for UBI to support unpaid work tend to have more pull than those that emphasize the policy’s potential to encourage traditional paid work.
The argument judged most convincing was one that framed UBI as a way of recognizing the value of unpaid work: “Many people do very important work that is unpaid, such as caring or other voluntary work. A basic income would be a way of rewarding and encouraging others to do this type of work.” A full 79% of respondents found the argument “very” or “fairly” convincing, while only 15% judged it “not very” or “not at all” convincing.
All arguments provided were found to be more convincing that not (i.e. considered by a majority of survey respondents to be “very” or “fairly” convincing). However, the least persuasive was found be the following: “Many unemployed people do not have an incentive to find a job because benefits they may currently be receiving are withdrawn. As everyone would receive it, a basic income would encourage unemployed people to get a job by allowing them to keep that basic income if they find work.” A relatively small 57% deemed this argument “very” or “fairly” convincing, and 35% found it unconvincing (or “not very” convincing).
Other arguments focused on automation, job insecurity, bureaucracy in administering welfare, the “harsh and unfair” nature of conditional welfare programs.
More information about the survey, including all weighted and unweighted data, is available here:
Ipsos MORI, “Half of UK adults would support universal basic income in principle,” 8 September 2017.
Reviewed by Russell Ingram
Photo (Newquay, Cornwall, United Kingdom) CC BY 2.0 Giuseppe Milo
by Kate McFarland | Sep 27, 2017 | Research
The Institute for Policy Research (IPR) at the University of Bath has released a policy brief titled “Assessing the Case for a Universal Basic Income in the UK”.
The 94-page policy brief surveys the rise in popularity of the idea of universal basic income (UBI), especially in the UK context, and examines its feasibility and possible implementation strategies.
The report’s author, IRP Research Associate Luke Martinelli, draws upon his previous microsimulation studies, including “The Fiscal and Distributional Implications of Alternative Universal Basic Income Schemes in the UK” (March 2017) and “Exploring the Distributional and Work Incentive Effects of Plausible Illustrative Basic Income Schemes” (May 2017). He supplements his own work with the simulation analyses of other researchers, including Malcolm Torry (Citizen’s Income Trust) and Howard Reed and Stewart Lansley (Compass) in the UK and Olli Kangas (Kela) in Finland. Martinelli argues that microsimulation techniques, which can be used to model the economic effects of UBI at a national level, allow researchers to address questions about the feasibility and desirability of UBI that are out-of-reach by “real-world” experiment–given that the latter “do not test for the crucial effects of accompanying tax changes, nor examine how changes in income and behavioural responses would be distributed across different demographic groups in the case of a truly universal payment” (p 16).
In Chapter 3 of the policy brief, Martinelli applies these simulation studies to the question of the affordability of UBI. Investigating both full and partial UBI schemes, Martinelli investigates the fiscal implications of the policy for the UK government, taking into account potential adjustments to the existing tax and benefit system, as well as their consequences for poverty and inequality. Overall, Martinelli finds that data “appear to suggest” that “it is possible to design a UBI such that it is both affordable and adequate” (emphasis in original), with the most feasible option being a partial UBI on top of existing means-tested benefits (p 48). However, he issues several notes of caution in interpreting this (apparent) consequence.
One cautionary note concerns the fact that the simulation studies use only static models, which do not provide for possible changes in labor market participation resulting from the introduction of UBI. In Chapter 4, however, Martinelli examines the labor market effects of UBI in detail, again drawing upon simulation studies. Here, he considers the results of studies that model the impact of UBI schemes on financial work incentives, concluding that UBI does significantly improve incentives, especially for low-income groups and recipients of means-tested benefits (although, as the author admits, monetary incentives are “by no means the only factor affecting labour supply decisions,” p 63). In this chapter, Martinelli supplements the simulation analysis with empirical findings from previous experiments on unconditional cash benefits (including, especially, from the negative income tax experiments conducted in Manitoba in the late 1970s). He also reviews a range of theoretical considerations, including the prima facie tension between the positions of UBI supporters who see the policy as a way of incentivizing employment (e.g. as contrasted to means-tested benefit schemes) and those who advocate the policy as providing an “exit option” from employment.
In the final chapter of the policy brief, Martinelli scrutinizes implementational challenges facing UBI in the UK, including complications building political coalitions around the idea. As Martinelli stresses, apparent political consensus around UBI is likely to dissolve when specific policy implementations are issue. In concluding the report, he urges supporters of UBI not to demand a full basic income immediately, but instead to consider an incremental approach. As potential first steps, Martinelli mentioned a small universal payment (“partial basic income”) or a basic income restricted to certain age groups (e.g., as suggested by Malcolm Torry, young adults or adults nearing pension age).
The full report can be downloaded here:
Luke Martinelli, “Assessing the Case for a Universal Basic Income in the UK”, Institute for Policy Research, September 2017.
Reviewed by Russell Ingram
Photo (Bath, England) CC BY-NC-ND 2.0 David McKelvey
by Kate McFarland | Sep 17, 2017 | News
Malcolm Torry, Director of the UK-based Citizen’s Income Trust, Visiting Senior Fellow at the London School of Economics, and General Manager of BIEN, has signed a contract with the publisher Palgrave Macmillan to edit An International Handbook of Basic Income.
Torry is currently recruiting authors of each of the book’s chapters (listed below). The publisher has issued the following the call for authors:
Palgrave Macmillan is planning to publish An International Handbook on Basic Income, which it intends to be a definitive guide to the current state of the debate.
The editor, Dr. Malcolm Torry, is seeking chapter authors who will represent the best available scholarship from around the world.
A few of the chapters will be commissioned: but for most of them the editor is seeking expressions of interest.
If you would like to express an interest in writing one or more of the chapters then please contact him at generalmanager@basicincom.org or info@citizensincome.org with a CV and a list of publications on Basic Income. Bids for individual chapters from two or three authors from different parts of the world will be particularly welcome.
Dr. Torry will be at the BIEN Congress in Lisbon from the 25th to the 27th September, and he would very much welcome discussions with prospective authors or groups of authors.
The table of contents is as follows:
Part I: The concept of Basic Income
- The definition and characteristics of a Basic Income
- The history of Basic Income
- The anatomy of a global debate
Part II: The effects of Basic Income
- Employment market effects
- Social effects
- Economic effects
- Ecological effects
- Gender effects
Part III: Implementation of Basic Income
- The anatomy of a Basic Income scheme
- The administration of a Basic Income scheme
- Costings for Basic Income
- The framing of Basic Income
- The feasibility of Basic Income
- Alternatives to Basic Income
- The funding of Basic Income
- The implementation of a Basic Income scheme
- Objections to Basic Income
- An illustrative Basic Income scheme
Part IV: Pilot projects and other experiments
- Canada and the USA
- Brazil
- Iran
- Namibia
- India
- Switzerland
- Finland
- The Netherlands
Part V: The political economy of Basic Income
- Libertarian arguments for Basic Income
- Left wing arguments for Basic Income
- Neoliberal arguments for Basic Income
- Human rights arguments for Basic Income
- The justice of Basic Income
- The ethics of Basic Income
Blank book photo CC BY 2.0 kate hiscock
by Guest Contributor | Aug 18, 2017 | Opinion
According to the OECD, basic income (BI) is not an effective tool for reducing poverty. However, the outcome would depend on the model chosen for implementing a BI system, as well as the changes made in other parts of social protection.
The Organisation for Economic Co-operation and Development (OECD) published in May a Policy Brief paper studying the feasibility of a basic income model in four OECD countries, one of which was Finland.
On June 16, Kela organized a seminar in which Herwig Immervoll, a senior economist at the OECD, discussed the findings of his study and analysed the strengths and weaknesses of a BI scheme. After the seminar, the national broadcasting company YLE reported: “Universal basic income might increase poverty and inequality”.
Apart from Finland, the OECD study includes France, Italy and the United Kingdom. The analysis was done with the help of the EUROMOD microsimulation model. In each country, the starting point for the analysis was to take all existing spending on social cash-transfers together and see what level of BI they would amount to. Eventually, the level of BI was set near the existing levels of guaranteed minimum-income benefits for single individuals in each country, adjusted so that it would not increase the public expenditures.
In Finland, this resulted a BI of 527 euros for the working age adults and 316 euros for children and youth under 18 years of age. Those entitled to old-age pensions within the current main statutory retirement age (in Finland over 65-year-olds) were excluded from the BI model.
In the BI model used in the OECD analysis, all existing working-age benefits (including social insurance benefits) apart from cash transfers for housing and disability would be abolished. Also, the zero-rate tax bands of income-tax schedules and equivalent tax-free allowances would be abolished, and all income-tax thresholds would be shifted downwards by a corresponding amount. BI would be made taxable under personal income taxation alongside other taxable incomes.
The OECD model would create many gainers and losers
The most important outcome of the OECD study is that the simulated BI model would strongly impact the income distribution in all studied countries. However, the effects vary greatly among the countries.
In all income groups, the BI model would create many gainers and losers. It would change the net income of most people in one way or another. It would lift some groups out of poverty and thrust others below the poverty line.
The simulated BI model would increase the income level of those small income groups who are currently not receiving any social benefits, or whose benefit level is very low. In turn, those receiving earnings-related benefits or several means-tested benefits would see a decline in their standard of living.
In Finland, those below 65-years-old receiving old-age pensions and single parents with low incomes would be among the losers of the model. The middle-income earners instead would generally benefit from the model.
The conclusion of the OECD is that particularly in countries with a comprehensive social protection BI is not an efficient tool for reducing poverty, since it does not target the benefits effectively. According to the OECD, a budget-neutral BI would not be distributionally neutral. High enough to be socially and politically meaningful and fiscally realistic, a BI would still require tax rises as well as reductions in existing benefits.
A very low basic income, instead, would have little other significance but increase poverty.
The outcomes of BI depend on reforms in taxation and social protection
How the findings of the OECD study are to be interpreted in the Finnish context?
Perhaps the most important issue that the research sheds light on is the fact that there are many institutional challenges in implementing a BI system, and those challenges differ among countries due to their different systems of social security and taxation.
As the OECD report (p. 5) notes, BI as an idea is simple, but the existing social protection systems are not. Therefore, there are grounds to argue that the same model of BI does not fit everywhere. If a reform such as BI were to be carried out, it needs to be adjusted to the existing institutions of social protection and taxation in each country separately. The parameters of the model should be adjusted so that it will not produce excessive changes in people’s incomes.
The greatest problems of the OECD’s microsimulation are that the income taxation is not changed to correspond with the BI model, and that the existing systems are demolished by the same means everywhere without examining the structures of social protection in each country separately. Due to this, BI seems to have unpredictable effects to income distribution.
The income distribution produced by a BI model can be influenced by adjusting the parameters of taxation and social security. In his presentation at the Kela seminar, Herwig Immervoll mentioned that tax reforms should be discussed in parallel with BI. Indirect taxes, such as environmental or value added taxes, have often been proposed as a complementary source for financing a BI scheme, combined with income taxation.
However, the OECD report does not mention these alternatives, and the premise seems to be that taxation in any form should not be increased.
In Finland, as well as in many other countries, some organisations and individuals have launched models of BI adjusted to the local context. Their objective has often (yet not always) been to not radically alter the income distribution or cause reductions in people’s after-tax incomes, especially in the lowest income groups. Microsimulation has been employed at least in the models of partial BI by the Green Party and the Left Alliance, and in the preliminary study for the national BI trial conducted by Kela.
In these models, BI is linked with a reform in income taxation that is designed so that radical changes in after-tax incomes will not occur in any income group. The aim is also to make the models budget neutral, that is, to cover the costs of BI by reforms in taxation and replacing the existing benefit systems. In these models, the old system will be abolished only in those parts where the level of benefits is lower than the BI.
One of the problems with the BI trial currently underway is that due to time constraints, the taxation reform proposed by the research team that designed the experiment was not included.
Will Finland implement a BI?
Though there exist BI models in Finland that would technically allow implementation of a BI system without radical changes in income distribution or public financing, the road of BI will probably be rocky even here.
The preparations of the BI experiment scheme revealed many institutional challenges in implementation of a BI model. The greatest obstacles for a BI are, however, ideological.
In Finland, BI has gained interest especially as a possibility to improve the incentives for paid work. The possibility to combine wages with social benefits more smoothly than today is an issue that no party opposes. Yet, many still find it morally wrong to give people money with no obligations. The opponents of BI fear that the “free money” would reduce people’s willingness to work and give a moral legitimacy to not apply for jobs.
If the only, or at least the most important function of BI is to improve work incentives, the great promises of BI may not be fulfilled after all. The preliminary studies for the BI trial revealed that BI models do not always unambiguously remove incentive traps, if parts of the old social security stay intact.
However, it seems likely that in Finland, as well as in other industrialised countries, the social security will be reformed in a direction that may contain some elements of BI, but not necessarily a ‘pure’ BI model.
If the political thinking emphasizing the labour supply and austerity in public economy prevail, the prospects for more generous BI models seem to be low. In the framework of current economic policies, the implementation of a BI would most probably mean at least demolishing large parts or other forms of social security.
BI as a social dividend?
The OECD report (p. 8) ends up recommending some kind of ’partial’ alternative of a BI model. One option mentioned is a possibility to introduce BI as a separate system from the existing social protection, whose function would be to share the benefits of globalisation and technological progress more equally.
This idea of ‘social dividend’ has often appeared in BI discussions. The state of Alaska is already giving an annual share of the permanent fund based on oil revenues to each citizen as a social dividend. There is similar thinking linked also to the idea of “helicopter money”, originally introduced by Milton Friedman, a cash transfer paid by the central bank to people’s accounts to stimulate consumer demand in economic downturns.
Considering BI as a social dividend would locate it in a new frame, where its function would not be to fix the problems of social security systems, but to distribute purchasing power also to those who lose their jobs or end up in low paid precarious jobs in the labour market turmoil caused by digitalization.
If BI were paid on top of other social benefits, its level could even be lower, or for instance connected to macro economy indicators. In that case, it could also be used to stimulate economies in downturns.
Johanna Perkiö
M.Soc.Sc., Doctoral Candidate
University of Tampere
email: johanna.perkio(at)uta.fi
Original article:
Johanna Perkiö, “The OECD and the problems of basic income“, Kela, June 30, 2017.
by Kate McFarland | Aug 17, 2017 | News
Slovenian basic income advocate Dr. Valerija Korošec has announced her bid to run in her country’s presidential election on October 22, 2017.
Basic income is the main pillar of her independent candidacy, which also includes e-direct democracy and gender parity.
Korošec made the announcement at a July meeting of Unconditional Basic Income Europe (UBIE), BIEN’s European affiliate. To officially run in the election, she needs to collect 5,000 signatures before the 26th of September.
Valerija Korosec
Korošec, a sociologist and social policy analyst at Slovenia’s Institute of Macroeconomic Analysis and Development, is the author of “Predlog UTD v Sloveniji: Zakaj in kako” (“UBI Proposal in Slovenia: Why and How”), which she presented in English at BIEN’s 2012 Congress in Munich, and the co-editor of the book UTD v Sloveniji (UBI in Slovenia).
She is also Slovenia’s representative in BIEN, and a member of both UBIE and BIEN’s Slovenian affiliate, Sekcija za promocijo UTD.
Basic income has enjoyed a surge of interest in Slovenia in recent years.
In 2013, Slovenia was the second EU nation to attain the required level of support the European Citizen’s Initiative (ECI) for Unconditional Basic Income. Ultimately, the ECI failed to obtain the number of signatures required across Europe for the EU to consider UBI. However, it helped to cultivate lasting awareness of UBI among Slovenians.
In 2016, UBI received a further boost in interest in the country due to international headline events such as Switzerland’s vote on a referendum to establish a nationwide basic income, and the Finnish government’s launch of an experiment to test the effects of an unconditional basic income for the unemployed.
One particularly notable event occurred on October 17, 2016–the International Day for the Eradication of Poverty–when Sekcija za promocijo UTD joined the Slovenian Red Cross and Slovenian Philanthropy, an organization encompassing many charities, in signing the Coalition Against Poverty, accepting the idea that only a basic income can fight poverty efficiently.
In June 2017, Alenka Bratušek, a former Prime Minister now serving as a Member of Parliament, convened a meeting on basic income in Slovenia’s National Assembly.
The occasion marked the second time debate about the idea has been held in a national representative body in Slovenia, with the first having been held in the National Council in 2011. At the National Assembly meeting, three basic income advocates–including Korošec, Dr. Igor Pribac, and Sebastjan Pikl–presented arguments in favor of the implementation of the policy.
Those present voted unanimously to request the government to produce a feasibility analysis of basic income by the end of the year.
At this time, new candidates are still declaring their bids for the Slovenian presidential race.
Polls show incumbent president Borut Pahor as a clear frontrunner, unbeatable by any major political party. In Korošec’s view, joining the election as a basic income candidate has the potential not only to spread the idea to more Slovenians but also to show politicians that the idea can have a substantial impact on the election–which might affect not only this year’s presidential election but also next year’s parliamentary race.
Draft of article reviewed by Valerija Korošec; additional copyediting by Russell Ingram.
Top photo: Ljubljana, Slovenia CC BY-NC 2.0 Gilad Rom
