This week at Cannock Chase District Council most Councillors backed my motion asking for the government to consider a pilot of Universal Basic Income (UBI) in our District. There was a good debate, conducted in a respectful manner but outside of Council it might be fair to ask why I brought this motion and why does it matter to the community of Cannock Chase. Below I will try and share what UBI is, why I think this is important and why it is local.

UBI is about the community looking after each other and ensuring every person has the means of a basic living and would eliminate poverty.

In simple terms UBI is a non-means tested, unconditional, non-withdrawable payment which covers the basic cost of living from the state to every person paid irrespective of wealth, background, employment or marital status.

This is essentially a big idea which would completely rewrite the welfare state as we know it now if implemented in the widest sense. It is an idea that has been around for decades which I was introduced to a couple of years ago and it is an idea whose time has potentially come given the post Covid world we will live in and the rapid progress of automation and the workplace. It is also an idea which has existed in largely academic circles so would need to be properly considered in the real world to see what can be done, how it would be implemented and the impact on the social, environmental and economic wellbeing of the community.

In its purest form UBI would be a payment to every person from birth until death so would replace Child benefit and State Pension. Further it would remove all other benefits and tax credits as these would not be needed, there would be no complex approach to means testing, no degrading capability assessments and no loopholes to abuse.

The two principal areas of concern are how much will it cost and will it disincentivise work.

To address the first of these is that in the traditional sense of pound notes out of Government to individuals yes it would increase the flow of money from Government to every individual and it would need a change in taxation to pay for this, this is part of the pilot to understand. There are many ways this might be achieved including removing personal tax allowances (as you would already be receiving that amount from UBI), reframing capital gains tax which is earning money from the things you have inherited or own rather than from the fruit of your labours, consider changes to the treatment of income from Company Directors, look at the tax treatment of bonus’s given through shares. There is a wide array of potential to this and there is not one single answer. A fairer, simplified tax system would not require whole government departments, accountants and bankers to interpret and implement and there would be significant savings from the cost of bureaucracy. The cost of a UBI and how you meet that cost would need careful consideration to ensure it.

To consider whether it would disincentivise people to work, this was a point raised several times by opponents within the debate and it is not something I accept. I like to work, virtually everyone I know likes to work. Some might like the job they are stuck in and others might not have that work recognised in a financial sense as a job but virtually everyone I know contributes to the community. Again, this would need to be part of outcomes from a pilot but a UBI would recognise the valuable work done in our homes, bringing up our children, caring for sick, elderly or infirm relatives, the volunteering which is prevalent in our community which fills so many gaps in healthcare, education and around the area whether that is litterpicking or decorating the town. These are all valuable contributions to our collective wellbeing and UBI would recognise that. It would disincentivise people to work in unrewarding often exploitative jobs where poor employers prosper. Conversely good employers would be incentivised to make their work rewarding and their terms of employment attractive to recruit and retain staff. Currently the Minimum Wage is set below the calculated Real Living Wage, this means that people in jobs are being paid less than the money they need to live on. So, whilst these top up payments through the welfare and benefits system are paid to individuals they should be considered as Corporate Welfare Subsidy for employers paying less than a living wage.

A pilot of UBI would also need to consider the wider impact of economic wellbeing including physical and mental health which would improve if people are lifted out of poverty and undertaking work which they enjoy and find rewarding. Educational attainment would improve both academically and vocationally as the strongly evidenced link between poor educational outcomes and poverty. A greater balance in family life could be achieved but could also allow individuals trapped in abusive relationships to escape as financial security is one less worry.

We have seen over the last year a lesson of what can be done if a crisis demands it. Much of the financial support provided by the government has helped many people but there are many people it missed just because the support has been implemented against a welfare system designed and evolved since the 1940’s without any fundamental review of the objectives and outcomes we wish to share as a society. The world in 2021 is not the same as the world of 1948 and the support we give each other through the state needs to reflect this.

 

The motion passed by Council is below along with a link to the video of the Council Debate and various further research links so you can find out more and make up your own mind if this is the big idea we need to reshape a future for everyone.

 

Universal Basic Income is a non-means tested, unconditional, non-withdrawable payment which covers the basic cost of living from the state to every person paid irrespective of wealth, background, employment or marital status. A fully implemented system would replace the need for a complex and unfair welfare state, benefit system and tax credits but it is recognised that extensive research and pilot schemes would need to be established to understand how this might play a role in the financial and social security needed to promote a prosperous and equitable future for every person.

Cannock Chase has areas recognised with historic and continuing deprivation, poverty and challenges to promote equal opportunities for all. The impact of the pandemic will be felt most severely on those with greatest need, the most vulnerable to the economic and social impact a changing world of work and employment will have in the coming years. With businesses closing, employment opportunities reducing and the fragility of zero-hour contract and the gig economy our community of Cannock Chase will not be immune to financial and social challenges to come.

The Council recognises that financial security is critical to a stable, thriving and prosperous community in Cannock Chase. The Council further recognises that with the changing nature of employment, earning and livelihoods the current welfare, benefits and tax credit system is not fit for purpose to fulfil the challenges of a post Covid future.

A universal Basic Income has the potential to address many of the most complex challenges in our society including inequality, poverty, precarious employment, recognition of the value of non-economic work such as caring for family members or voluntary work, giving employers a more flexible workforce and employees greater freedom to pursue their ambitions and removing the complex, conditionality and negative aspects of the current system.

The Council believes that these principles need testing and developing to understand their impact on the real challenges which lie ahead and recognises the work being undertaken by UBILab and others. It is noted that trials have also been considered in Finland and Spain are rolling out something similar as part of their Covid-19 response.

The Council resolves that the Managing Director write to the Secretary of State for Work and Pensions, the Chancellor of the Exchequer and their counterparts in all political parties as well as our Member of Parliament calling for a fully evaluated pilot of a Universal Basic Income in our community of Cannock Chase.

https://www.facebook.com/105270107884134/videos/2909667079290288

References

This motion has been drafted by myself inspired by the many other motions taken to Local Authorities across the Country

https://www.ubilabnetwork.org/

Further reading can be found drawn from references within some of the motions taken elsewhere

https://citizensincome.org/

http://www.usbig.net/pdf/manyfacesofubi.pdf

https://www.sciencedirect.com/science/article/pii/S0305750X19301652

https://www.nber.org/papers/w27351

https://economics.mit.edu/files/16000

https://www.bmj.com/content/355/bmj.i6473

http://www3.weforum.org/docs/WEF_Forum_IncGrwth_2017.pdf

https://basicincome.scot/

https://clivelord.wordpress.com/