by Stanislas Jourdan | Apr 18, 2016 | News
Ahead of the national referendum taking place early in June, the Swiss city of Lausanne has adopted a motion to test a basic income and assess the effects of the policy.
Will Lausanne be the first city in Switzerland to test a basic income? It is possible. Last Tuesday, April 12th, the City Council took an important first step, when it adopted a motion (pdf) aimed at running a basic income experiment. This non legally-binding motion – which asks the Executive Council of the Municipality to implement a pilot – passed by a close margin (39 votes in favor versus 37 against, with 8 abstentions).
The motion has received significant support from the Green Party. It was originally tabled by Green Party member Laurent Rebeaud, who passed away in December. Léonore Porchet, President of the Lausanne Green Party, says, “Basic income offers a solid and securing social floor, as opposed to the fragile social safety net that we know today. The freedom provided by basic income encourages activity, social inclusion and innovation. In addition it values and support the ‘free’ work such as volunteer activities.”
Recent polls conducted in Switzerland bolster Porchet’s contention that a basic income would “encourage activity” rather than subsidize laziness, as some detractors fear. These polls conclude that only 2% of Swiss people would stop working if they had a basic income, while 22% would become entrepreneurs and 54% would take opportunities to improve their qualifications.
Although the Lausanne City Council’s motion remains vague about the specifics of the experiment, it proposes that it should be monitored in cooperation with the University of Lausanne, in a way similar to the basic income pilot planned for the Dutch city of Utrecht, which is being developed in collaboration with the University of Utrecht. Lausanne is a city of 130,000 inhabitants located in the French speaking region of Switzerland. However, the experiment would include only a sample of the population.
To run the experiment, the city will need financial support from the Canton and the Confederation. However, this is likely to be feasible, as it should not incur more costs than the existing budget for social benefits.
The Lausanne experiment’s main goal would be to assess how work incentives change depending on the conditions for receiving social benefits, as Porchet explains on the website of the local section of the Green Party.
Picture CC Alice
by Karl Widerquist | Apr 15, 2016 | News, The Indepentarian
GiveDirectly, a charity which has used direct cash distribution in one-time, lump-sum payments to fight poverty in Africa, announced it will launch a full basic income trial. The project will involved at least 30 million dollars and academic support from leading researchers at the MIT. The charity is relying on donations from all around the world. The trail will fully adopt the basic income model by making regular cash payments to every resident in several villages in Kenya.
GiveDirectly’s appeal for support it below:
Dear friends,
We’re announcing something new. Something that’s never been done before.
GiveDirectly is launching a universal basic income trial — this year, we’ll begin paying everyone in multiple Kenyan villages a regular income that’s enough to meet their most basic needs, and keep doing so for more than ten years.
People have long debated whether we should provide a guaranteed minimum floor for everyone (a “basic income”), and what would happen if we did. Would it spur risk-taking and creativity, or would people just stop working? Would it drive growth or reduce it? Would people spend more time on entrepreneurship, or on education and parenting? With the idea being hotly debated around the world, it’s time we found out.
We’re teaming up with leading researcher Abhijit Banerjee from MIT and have calculated that we can run and study a real trial for $30 million, and we’re willing to match the first $10 million donated.
To make this happen, join us and contribute a small amount to help the world find out if a guaranteed basic income could be the tool that ends poverty.
Together, in the last five years, we’ve raised $100 million, helped shift a worldwide policy discussion, and served over 150,000 individuals based on the proven principle that giving poor people cash works. Now it’s time for us to take the next step. It’s because of you that we’ve made it this far, so we hope you’ll join us for this newest project.
Visit our website to learn more or to contribute to the project.
If you do decide to give to this trial, at a minimum your money will help shift the life trajectories of thousands of low-income households. At best, it will change how the world thinks about ending poverty.
All the best,
Ian Bassin
Chief Operating Officer – Domestic
You can read more about GiveDirectly’s new basic income project at the following links:
by Kate McFarland | Apr 5, 2016 | News
Kela, the Social Insurance Institution of Finland, released its preliminary report on a universal basic income on March 30th.
The report details several models of a basic income — including a full unconditional basic income, which would replace existing benefits, a partial basic income, and a negative income tax, among others.
After examining these options, the working group recommends that Finland adopt a partial basic income model for its impending experiments. According to the report, this model would “consolidate many of the existing benefits offering basic economic security, while earnings-related benefits would remain largely unaffected.” The group further recommends that a combination of national and regional samples be used in the trials.
The complete report, in Finnish, is accessible from Kela’s website. A summary is available below:
Suitability of different basic income models for the experiment
The preliminary report looks at a full-fledged unconditional basic income model, a partial basic income model, a negative income tax model as well as possible other models in terms of their suitability for the experiment. An unconditional basic income would take the place of much of the currently existing system of social provision, where eligibility for benefits is tied to specific contingencies. The basic income would therefore have to be substantial, which would make the model quite expensive. A partial basic income model would consolidate many of the existing benefits offering basic economic security, while earnings-related benefits would remain largely unaffected. To study incentive effects, simulations on a partial basic income model are run at a range of different replacement rates and levels of housing costs.
Both nationwide and regional samples
The working group proposes that a two-pronged sampling approach should be used in the actual experiment, consisting of a randomised nationwide sample and a regional, and more intensive, sample to study externalities. A weighted sample can be produced of population groups that are particularly relevant to the experiment. There are a number of constitutional and other legal problems associated with the design of the experiment, which the report examines extensively.
According to the report, a universal basic income would eliminate some bureaucratic roadblocks and gaps in coverage, but would not by itself solve all problems related to disincentives. The elimination of disincentives requires reforms in several different areas of social and tax policy. One problematic group in terms of social policy consists of single parents, particularly those paying a high rent and living in the greater Helsinki area. It is difficult to eliminate the disincentives they face without a wholesale readjustment of the social security system. Lowering the minimum level of welfare provision would be an easy way to produce better incentive outcomes. However, doing so would increase poverty and create more financial hardship.
Partial basic income as starting point
The report points out that trying out a negative income tax would require access to a comprehensive registry of incomes. Studies in the United States show that experiments with self-reported data do not produce reliable results. A basic income model strongly based on conditional reciprocity runs into problems of supervision and control, i.e., how to define the level of participation required by reciprocity and who will supervise and document that the requirements are met. Such an experiment would necessarily be of limited scope.
The working group believes that consolidation of the current system of basic economic security into a partial basic income would produce valuable results. Since a universal basic income and a negative income tax are, from the individual’s perspective, functionally equivalent, trying out a partial basic income would generate useful information also about the negative income tax. Such an experiment could be implemented without a registry of incomes by leveraging the existing welfare payments system operated by the Social Insurance Institution. Since it would also be possible to use the welfare benefits provided by the Social Insurance Institution as a basis for the experiment, the sample size could be increased substantially, which would make the results more reliable and make it possible to focus on specific population groups.
The Finnish government will now decide, based on the report, how to design the experiments, and what new legislation will necessary. Kela’s working group will release its final report on basic income on November 15th.
Finland announced its plans to test a basic income last November, to resounding international publicity. For more information, see the following Basic Income News reports:
Stanislas Jourdan, “FINLAND: Government Forms Research Team to Design Basic Income Pilots,” 15 October 2015.
Vito Laterza, “FINLAND: Basic income experiment – what we know,” 9 December 2015.
Tyler Prochazka, “Dylan Matthews, ‘Finland’s hugely exciting experiment in basic income, explained,” 13 December 2015.
Thanks, as always, to my supporters on Patreon.
by Kate McFarland | Mar 28, 2016 | Research
University of Tampere
Last November, Finland’s plans to test a basic income caught the attention of international media. Although the experiments are still some months away (scheduled to begin in 2017), the Finnish Social Insurance Institution (KELA) has continued to make strides in investigating the possibilities for a basic income.
KELA has recently published a working paper that reviews the current state of the debate on basic income and assesses the pros and cons of various specific proposals.
Johanna Perkiö, a doctoral candidate at the University of Tampere, has written a useful summary of the KELA paper — including a description of the differences between the models of a basic income proposed by the Green Party, the Left Alliance, the think tank Libera, the Christian Democratic Party, and the Social Democratic Youth Organization.
Perkiö also discusses the challenge of removing disincentives to work during the study, given that traditional benefits will remain in place during the trials. She broaches solutions such as a negative income tax system and reduction of benefits on a sliding scale.
To learn more about the variety of basic income models under consideration:
Johanna Perkiö, “Universal basic income: A search for alternative models,” Tutkimusblogi, January 25th, 2016.
Thanks to my supporters on Patreon. (Click the link to see how you too can support my work for Basic Income News.)
by Jonny West | Mar 21, 2016 | News
On 30 January 2016, BasisInkomen, the Dutch association for a basic income, hosted the International Congress on Basic Income Experiments in Maastricht, Netherlands, to celebrate its 25th anniversary. This was an opportunity for those interested in the idea of a basic income to come together to reflect on recent developments – particularly in the Netherlands, Finland and France – and look towards the future. Keynote speakers included Julia Backhaus, Sjir Hoeijmakers, Stanislas Jourdan, Markus Kanerva, Otto Lehto, Philippe van Parijs, Bono Pel, Guy Standing and Nicole Teke. This article is a summary of the key points from the congress.
Guy Standing opened the congress by reflecting on the journey that the basic income idea has made over the previous 30 years: from the impossible to the ridiculous to the absurd and now perhaps even to the cusp of the inevitable. Two key themes ran through Guy Standing’s presentation: the necessity for further experimentation in order to gain political legitimation and, moreover, the importance of designing these experiments based on normative principles of social justice, such as wealth redistribution and social emancipation. If political legitimation can be won, based on principles of social justice, then a basic income will provide a pathway toward a dignified life for individuals within a good society — a society in which the collective wealth of the community is shared equally within and across generations, and in which each individual makes a moral commitment to actively participate in society. The idea of a basic income represents a rejection of the opportunistic politics of today in favour of a positive vision for tomorrow’s good society.
Guy Standing
After Guy Standing’s expansive introductory speech, discussion turned to the details of social experiments currently being planned in the Netherlands, Finland and France. In each case, recent developments demonstrate broad support for some type of basic income across the political spectrum.
In the Netherlands, nineteen municipalities are currently developing some form of social security experiment, which will remove the condition that beneficiaries must participate in workfare schemes, and tackle the poverty trap that beneficiaries experience when transitioning between the social security system and work. While many of these municipalities initially proposed introducing a basic income as part of the experiment, current legislative restrictions have limited this number to three. Four municipalities have lobbied the Dutch Ministry for Social Security and Employment to revise these legal restrictions, though the government has yet to respond. Despite this legal scuffle, the proposed Dutch experiments reveal widespread support for a basic income experiment across the political spectrum, with each major political party represented among the nineteen municipalities.
In Finland, the government has proposed a number of social experiments, including a basic income experiment. The government’s aim is to better align social policy with societal demands, as well as to reduce disincentives to work and decrease the role of bureaucratic processes in social security. A research consortium led by Kela, a government agency responsible for social security payments, is responsible for designing and implementing the basic income experiment. A first hearing for the basic income experiment was held on 5 December 2015, while a preliminary report will be released on 30 March 2016 and a final hearing will be held on 15 November 2016. A budget of €20 million has been allocated to the basic income experiment, which is expected to begin in 2017 and last two years. Different variations of a basic income are currently being considered, including a ‘full’ basic income, a ‘partial’ basic income, a negative income tax and a participation income. The models propose a basic income of between €400 and €1,200 per participant per month, with many models retaining supplementary allowances. One major challenge is the constitutional requirement to treat all citizens equally. To meet this requirement, participation in the experiment will be voluntary. A basic income experiment enjoys broad public support across voters of all major political parties in Finland, and recent public opinion polling indicates that more than 50% of the public supports the idea.
Nicole Teke (Credit to: MFRB)
In France, parliamentary support for a basic income has been increasing. Current proponents include Jean Desessard MP (Green Party), Frédéric Lefebvre MP (Les Républicains), and Gaetan Gorce MP and Delphine Batho MP (Parti Socialiste). Furthermore, the Minister of Economy, Industry and Digital Affairs Emmanuel Macron expressed support for the idea of a basic income and a government agency on digital affairs recommended introducing a basic income experiment. In addition, the Sirugue Commission, a parliamentary working group led by Christophe Sirugue MP (Parti Socialiste), is under increasing pressure to examine the case for a basic income experiment as part of its comprehensive review into the existing social security system. Meanwhile, the regional coalition government in Aquitaine is developing its own proposal for a basic income experiment. However, social security policy is a departmental rather than regional competency, and the regional governmental tier is currently being restructured with welfare allowances likely to become a central government competency, which might pose difficulties for regional experimentation.
All such experiments, however, will be limited in what they are able to prove. In his presentation, Philippe van Parijs challenged the audience to reflect on three such limitations. First, an individual is likely to make different labour market decisions depending on whether the basic income is temporary or permanent, which will distort the effect on labour supply. Second, participants receiving a basic income within an experiment will only account for a small fraction of the total labour force rather than the whole labour force, which will distort the effect on labour demand. Third, voluntary participation in the experiments will likely attract net beneficiaries rather than net contributors, which will distort the effect on financing. Philippe van Parijs then articulated the social justice case for a basic income: a basic income is an intergenerational redistribution of the currently unfair and uneven allocation of the efforts of previous generations as well as accessible natural resources. Furthermore, a basic income is a gift, which deserves a counter gift. If this counter gift were a commitment to actively participate in society, it could nurture a renewed ethics of responsibility. This is a strong case for a basic income, which exceeds the scope of the experiments planned in the Netherlands, Finland, France and elsewhere.
In all, the congress was one of optimism buoyed by a sense that the basic income movement is on the cusp of something momentous. The various developments in the Netherlands, Finland and France were also a reminder that if we truly want change, we can find a form for that change that fits our unique circumstances. We are not restricted by whether our political systems are centralised or decentralised, majoritarian or multi-party, left or right, a republic or a constitutional monarchy – we our restricted only by our imaginations and our tenacity.
More information at:
Basisinkomen.org, “Interviews and Lectures about #basicincome from Maastricht 2016”
