Universal basic income in Wales: the case for and against
A business innovation lead at a housing association and a lecturer in public policy explore universal income and reach very different conclusions about its value.
The case for: Steve Cranston, business innovation lead at United Welsh Housing Association
The world is at something of a crossroads. Whenever you turn on the news, hit up your Twitter feed, or listen to the fabled man or woman in the pub, you get the impression of a world in flux. Uncertainty reigns supreme, and the risks to our economy, ecology and society are high, and rising.
It’s against this backdrop that we’re calling for an urgent investigation into basic income here in Wales. We’re not suggesting that basic income is some panacea to all these potential risks, but we do believe it could form part of the answer, and as such, cannot be summarily dismissed out of hand.
Work today isn’t ‘working’. Workers are increasingly unhappy, impoverished, at the beck and call of their masters, and some, even enslaved. Precarity rules the working lives of an ever expanding cohort – and that includes people in this room, our families and friends. Two thirds of those in poverty live in working households. Capital is king, and its power is growing apace.
Work today isn’t fair. The rewards for certain work are over-egged (financialised marketeers betting on the tiniest swing in commodified tosh); for other work (elderly care, child-rearing, community building for example) the rewards are non existent, but the societal benefits are high.
Welfare today isn’t ‘working’. The dehumanising focus on austerity has led, in part, to a rejigging of the welfare system (Universal Credit, sanctions regime etc). More to the point, it is wrong -minded, as the focus always reverts back to work. And as we know, work today isn’t working.
We’re not alone. These are international problems, affecting post industrial communities, first and hardest. They have been pressing issues for some time. Issues we have failed to address.
There’s a growing debate about the impact of driverless technology, robotics, automation and artificial intelligence on the future of work. Future scanning experts who fundamentally disagree on what they think will happen, all agree on one thing - work will fundamentally change over the next decade and beyond.
We can see a future with far fewer jobs. That will have massive political consequences. It’s a risk that needs us to model solutions. Leaving these problems (and solutions) to those running the country a decade from now is a dereliction of duty for those of us here today, and scarily could be too late, for too many. Many who will be consumed by debilitating poverty, and a society looking for ‘others’ to blame.
Contemplating the concept of basic income forces us all to challenge key assumptions about work, welfare and purpose. About stress and anxiety. About freedom and happiness. It takes us into really deep questions about whether we exist simply to spend a third of our lives working for someone else. Society needs us to have these debates. Our Well-Being of Future Generations Act is the catalyst for this challenge.
There are basic income trials of one sort or another across the world, including our near neighbours in Scotland. There is so much we don’t know about the concept, especially regarding key challenges such as cost, behaviour change(s), the work that is left to do, redistributional impacts, how we deal with those with particular needs etc., that we need these trials, and more.
So, Wales, let’s do our bit and argue for a basic income pilot. Lets contribute to the world’s learning on basic income.
The case against: Dr Patrick Diamond is a senior lecturer in public policy at Queen Mary, University of London
The proposal for UBI is exciting everyone from from Jeremy Corbyn’s Labour party to tech entrepreneurs in Silicon Valley. But while UBI might be a big idea whose time has come, there are alternative strategies that stand a greater chance of winning over the public. I worry that UBI could be detrimental to the progressive cause.
Firstly, basic income could set back the public debate about how to create more egalitarian societies. As Donald Hirsch has written, basic income involves, “a very different tax settlement to the present one.” In a climate of austerity marked by declining real wages, UBI would require higher taxes on average incomes. Raising taxes is never politically popular; to add insult to injury, taxes would be used to fund a proposal that contradicted many citizens’ notion of what is fair, flipping the concepts of contribution and reciprocity on their head. After all, voters agree that benefits and services should be directed towards those who need them most, especially children and pensioners.
Moreover, work is valued as a social institution; it is widely accepted that a key function of the welfare state is to help get people into jobs, a goal met very effectively in the Scandinavian countries. In other words, politically and culturally, western societies are a long way from arriving at a “post-work” future. As long as paid work continues to be ascribed social value, those outside formal employment will be more vulnerable to isolation, poor health and reduced well-being. A UBI or any measure that was perceived to promote “worklessness” would struggle to achieve legitimacy. More importantly, it would risk souring the political discourse at a time when voters may be more amenable than at any point since the 1970s to radical measures.
The second issue relates to whether UBI would end up increasing unemployment among vulnerable groups, exposing them to even greater precariousness. Research has shown that guaranteed income schemes reduced the working hours of “secondary earners,” usually women, who became more dependent on the principle breadwinner. Feminist critics fear that basic income will lead to greater numbers of women dropping out of the labour market, or significantly reducing their working hours. Women would end up doing more unpaid domestic labour relative to men, making the household division of labour more unequal.
The third point is that UBI is insufficiently transformative. Indeed, UBI might trap the most disadvantaged in a cycle of inequality and precariousness from which there was little prospect of escape. For an individual with an insecure job, trapped in low-paid work, and living in poor quality urban housing, it is hard to envisage how UBI would substantively improve their life circumstances. They are not likely to enjoy better conditions at work; nor would basic income give access to an improved environment. A UBI would compensate individuals for the effects of inequality, but it absolves governments of responsibility for taking active measures to help those most exposed to “new” and “old” social risks.
Finally, UBI could have a detrimental impact on existing social policy. The cost of basic income would mean that credible reforms of the welfare state and the labour market might become unaffordable. Most benefits and subsidies already in place would have to be renegotiated. Neo-liberal advocates of UBI celebrate the idea because, in the words of Charles Murray, it would be a “replacement for the welfare state.” Market liberals argue individuals could use basic income to purchase services currently provided through the state: education, pensions, healthcare, unemployment insurance, childcare, and so on. Thus perversely (and contrary to the intentions of many of its advocates on the Left), UBI might end up encouraging the marketization of the public sector, while limiting the funding available for social investment. Basic income promises to cure a vast range of social ills through a single intervention.
In reality, a variety of carefully designed social policy programmes are likely to have greatest long-term impact.
- Steve Cranston and Patrick Diamond will take part in a debate on universal basic income on day two of TAI - click here for the full programme