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Employment

Is a universal basic income coming to Wales? Campaigners say now is the time

First Minister Mark Drakeford suggested the idea will be discussed in the Senedd in his acceptance speech. UBI Lab Network’s Sam Gregory explains why a UBI is more relevant than ever

A universal basic income is closer than ever to its first UK trial after Welsh First Minister Mark Drakeford suggested the idea will be discussed in the Senedd during his term.

In an acceptance speech following his May 6 election victory, Drakeford said he would open the door to “new and progressive ideas” and namechecked a universal basic income, an idea to open up more opportunities by giving everyone a base rate of income.

Drakeford said: “We will govern in a way that seeks out consensus and will take on board new and progressive ideas – from wherever they come. Ideas that can improve and enhance what we discuss in this chamber.

“From coronavirus to clean air; from universal basic income to ensuring young people are not priced out of Welsh-speaking communities. This will be a government that listens and will work collaboratively with others where it is in the interests of Wales to do so.”

Where has a universal basic income already been trialled?

The idea of a universal basic income has proven to be a controversial one in the past and UK Chancellor Rishi Sunak has repeatedly rejected the idea during the Covid-19 pandemic.

Other countries have made tentative moves towards a UBI with their own economic response. The Spanish government introduced a Minimum Vital Income in May 2020 – while not universal as it was paid only to low-income families, it is a first step towards a UBI.

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It’s a similar story in the US where President Biden introduced a series of $1,400 (£1,000) payments for single adults earning less than $75,000 (£54,000) a year.

The Scottish Government has run studies to test the feasibility of the idea in recent years and both the Lib Dems and Greens pledged to trial a UBI in their Scottish election manifestos. The Lib Dems did the same during their campaign in Wales before Drakeford paved the way for the idea to be tested in Wales with his acceptance speech.

A Welsh trial could provide the large-scale proving ground that the idea needs.

So far, Finland has given the idea its most thorough test. The 2,000 Finns who took part in a trial in 2017 and 2018 were happier while receiving the payment and there was a very slight increase in employment. Crucially, UBI detractors’ fears that people would take the cash and avoid work proved unfounded.

Or London could provide the place for a pilot. The London Assembly’s Economic Committee gave the green light for the capital to become the largest city in the world to trial a UBI in March. City Hall is now in consultation with central government and local authorities on a pilot.

The step is good news for the growing grassroots campaign behind UBI. Universal Basic Income Lab Network is made up of local decentralised groups across the world – as the pandemic broke out in March last year they had seven labs. Now they have 38 across the globe including 32 in the UK. 

Why a universal basic income could be this generation’s NHS

Writing in The Big Issue’s future of work special edition magazine, UBI Lab Network’s Sam Gregory explained why a universal basic income is an idea whose time has come.

“As a result of the pandemic, millions more people know what it’s like to be one payday away from poverty,” he wrote. “Families on good salaries, as well as the self-employed, have learnt how threadbare our social security system is.

“Universal basic income is an unconditional and regular cash payment to everybody – regardless of income, wealth or work.

“It would create a safety floor that nobody could fall below, whether you lose work or have to escape an abusive relationship.

“Most proposals in the UK range between £50 and £150 a week for adults, and £30 to £80 a week for children. The highest earners would receive a UBI (like they use the NHS), but would also pay more in tax to fund a basic income for everybody.

“If set above the poverty line, a UBI could drastically reduce homelessness and end rough sleeping altogether. In 2009, a London charity gave 13 men who’d slept rough for 40 years a UBI of £3,000. A year later, each of them had spent just £800 on average and seven of them had a roof over their heads.

“The gross cost of a UBI – the amount each person would receive multiplied by the population – is substantial.

“But that’s before factoring in the money coming back from higher taxes on the wealthy. Modelling has shown that a UBI set high enough to end absolute poverty would have a net cost of just £67bn a year. That’s less than what poverty itself costs the UK taxpayer, which the Joseph Rowntree Foundation estimates to be £78bn a year.

“At the UBI Lab Network, we want to pilot basic income to see how it would work in practice. Would it improve our health? What effect would it have on employment and financial security? How would giving everybody more cash to spend transform our communities? We can only answer these questions by trying it out – ideally in cities, towns and rural areas across all four nations of the UK.

“As we rebuild from the pandemic, we have a unique opportunity to tackle inequality and end poverty for good.

“Politicians from every party in the country are now backing pilots.

“In the aftermath of the Second World War, we created the National Health Service to guarantee health security to everybody.

“A universal basic income could be our generation’s NHS.”

To join or start a UBI Lab where you are, visit ubilabnetwork.org

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