A basic income is an income unconditionally granted to all on an individual basis, without means test or work requirement. It has been proposed at various times over the centuries by thinkers from Thomas More and John Stuart Mill to, more recently, Joseph Stiglitz and Thomas Piketty. Its attraction reaches across the political spectrum, from Martin Luther King to Milton Friedman.
Proponents of a basic income point to a host of benefits, ranging from ending poverty and reducing inequality, to securing better working conditions and greater recognition of unpaid contributions such as child rearing or volunteering. Non means-tested income is also much simpler to administrate making it a compelling proposition when considering ways to reduce fraud or levels of bureaucracy in welfare systems.
Do basic incomes work?
President Richard Nixon experimented with versions of the basic income in the 1970s (though in reality it was more like a tax credit). The trials suggested that recipients benefitted from the income but slightly reduced their hours in the labour force, though these findings are open to interpretation.
A more recent project in Namibia to provide a village with a basic unconditional income has produced some interesting findings, including the ability of villagers to use the income as seed funding for micro-enterprises such as hairdressers and bakeries.
The bottom line however is that systematic trials have, up until now, been in short supply. But 2016 may be the year that this all changes.
A number of cities and countries in Europe have committed to trialling a basic income, including the Finnish government. Prime Minister Juha Sipilä stated that the basic income meant ‘simplifying the social security system’. Meanwhile the Dutch cities of Utrecht, Tilburg, Groningen and Wageningen are petitioning the Dutch national government to permit local trials.
Proposals for basic income are also appearing with greater frequency in political debate. Spain’s Podemos may have surprised supporters of the basic income by leaving it out of its manifesto released in November, but proposals have been put forward by the Pirate Party in Iceland. And in Canada, the women’s commission of Trudeau’s recently elected Liberal Party government has also called for a basic income pilot.
Activists in Switzerland recently collected 125,000 signatures in support of introducing a basic income, triggering a citizen-initiated referendum to be held in 2016. In September 2015, an overwhelming majority of the Swiss parliament recommended the people reject the initiative though public opinion remains more evenly divided.
Meanwhile in the UK...
Here in the UK, the introduction of universal citizen's income remains party policy of the Green Party. Charles Leadbeater recently proposed it as one of a number of imaginative ideas that could save the Labour Party and Corbyn advisers such as Richard Murphy are known to be supportive. The Liberal Democrats have previously proposed a citizen's income as party policy, and internal advocates are championing its return.
It is hard to see the current government introducing a basic income trial anytime soon, so instead the UK will probably have to settle for sitting on the sidelines and observing the results of the many experiments around the world. One thing is certain, we will have more evidence to examine by the end of 2016.
Here at Nesta, we can see many reasons why trialling a basic income would be a good idea, from our interest in shaping the economy of the future through to our work on inclusive models for economic growth, to our desire to see more people actively volunteer and contribute to public services and support one another in our vision for more people-powered health.
A basic income can provide a safety net for people wishing to retrain, which is worth considering given the massive technological changes that we anticipate in the decades ahead. It can enable citizens to make greater unpaid contributions to their communities, strengthening the fabric of social relations and reduce the burden of professional care. And the reduction in poverty brought about by a basic income can provide children with a much better start to life.
We’ll certainly be watching closely as the evidence from global trials starts to trickle in over the course of the next few years.