Tag Archives: universal basic income

Which kind of equality do the Lib Dems value most?

Considering here just everyone living in Britain, all of whom Liberal Democrats value, what kind of equality should we seek for them? And what matters most for public policy?

Equality of treatment in health and social care, I suppose we expect and the nation demands, not just our party. So far there is no disagreement. But equality of educational opportunity for all children and young people? We haven’t got that in our country, far from it. For Liberal Democrats to campaign for it when we aren’t prepared to reduce the privileges of the private schools perhaps limits our efforts, but we will surely try to help.

Do we seek equality of income for all? Hardly. Or of wealth ownership? Scarcely. But we do want nobody to live in poverty. 

Then, how about equal freedom for everyone to have satisfying lives? Yes, certainly. Equal freedom to ensure our children have good lives? Yes, surely. However, both those last two aspects of equality depend on freedom, which to me is the greatest good.

Well, equality is a Liberal Democrat value as well as freedom. We as a party wanted everyone to have the equal provision of a basic citizens’ income when we passed the UBI motion at the last Conference. However, is it not possible, if that is the only income-related equality we seek, that the nation might in achieving it become more unequal? Because there could be large swathes of the working-age population in future subsisting on the basic income, whether out of necessity or to relish the freedom it represents. Perhaps we will stop trying to help everyone who wants a job to find one. Perhaps we will stop bothering about them not having a home of their own, rented or privately owned? Well, no, you will say, of course we want everyone to have a secure and affordable home – equality in that. So housing benefit must continue.

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The Liberal case for a Universal Basic Income

Following the economic downturn of COVID-19, a renewed interest has emerged in the idea of a Universal Basic Income (UBI). This development has been visible on the UK political scene, with 170 MPs and Lords calling for an “Emergency UBI” in the wake of the first national lockdown.

In practice, a UBI would give every citizen a guaranteed weekly government payment to supplement their main earnings. In effect, it would provide those hit hardest by the COVID recession with a baseline economic security; “a basic income floor”, as Prospect puts it.

In being an expansion of the welfare state, advocacy of a UBI tends to be more common on the ideological left. Indeed, it was the leftist Green Party who advocated such a scheme in the UK’s last General Election, in proposing that every citizen receive a minimum of £89 per week by 2025.

But should the UBIs appeal be limited to those on the left, or can it find favour with a broader demographic? It is true that the concept has received support from contemporary figures across the political spectrum, with noteworthy examples including the free market economist Milton Friedman, the left-leaning economist Thomas Piketty, and the former US President Barack Obama.

It is my belief that the introduction of a UBI is a cause which all liberals should get behind. With its potential to facilitate greater individual freedom and economic opportunity, as well as an enhanced sense of social justice, I believe it aligns fully with modern liberal values.

It has long been understood by liberals that freedom from economic deprivation is as vital a consideration as freedom from physical harm. If a person is deprived the necessities of living, they can hardly be free to pursue a productive, prosperous life. It is for this reason that liberals uphold the need for a sufficiently sized government safety net. But with recent years witnessing a continual rise in the UK poverty levels, as seen in the upsurge in food bank usage, it would appear undeniable that the country’s current safety net is deficient in its size and outcomes.

Such a predicament is set to be compounded by the economic downtown inflicted by COVID-19. According to the Office of Budgetary Responsibility, as many as 3.5 million UK residents could find themselves unemployed in 2021. Such economic wounds would no doubt be deepened by the country’s ever-rising wealth gap, with this a major issue prior to the pandemic.

Liberals must be prepared to call on the Conservative Government to undertake swift, bold action fuelled by an openness to new approaches. Simply papering over the cracks will not do; the system needs significant reform and expansion, justifying the addition of a UBI to ensure the basic living costs of every citizen can be met.

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Universal Basic Income – The case the Liberal Democrats must make

I do not intend to argue that UBI is a sensible, humane and economically transformational policy – its worth as a policy is readily apparent to any and all who have seen the devastation wrought by the pandemic. The inadequacy of miserly and bureaucratised welfare provision has now, for the first time in history, been made abundantly clear to a large swathe of the population who had previously been insulated from the humiliating, degrading, maddening process of claiming their entitlement to income support due to unavoidable job loss or illness.

What this moment represents is an opportunity to project the Liberal Democrats as a party concerned with rectifying this grossly outdated system with Universal Basic Income. The Party would demonstrate its commitment to the issues which are of paramount importance to the people of the United Kingdom: their financial security. No more sabre rattling about the EU; let us leave wading in the constitutional quagmire to the Conservatives and the SNP. It does us no favours to be the eternal champions of a defeated cause – the UK will not be re-joining the EU for decades in even the most optimistic prophecies.

UBI, however, is an immediate issue, out of which the Party could make enormous political capital, but only if we focus our energies on making it the well-honed point of a spear; the Party simply does not command enough public attention or respect to offer comment on the wide array of policies which we commit to. The two most successful political parties, the Conservative Party and the SNP, in the UK have founded their recent success upon their message cohesion – Boris’ ‘Get Brexit Done’ and the SNP’s never-ending commitment to independence. UBI is potentially superior to these platforms in nature – it is a unifying message, not based on division, and, properly communicated, hard to argue with. Show me a upper middle class individual who would publicly announce the low paid logistics, health or social care workers don’t deserve a bedrock of guaranteed economic security.

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A Basic Income is a story the Liberal Democrats can champion

This time last year my Lib Dem council colleagues and I on Hull City Council tabled and passed a motion to call for a Universal Basic Income pilot in Hull; we were the first of what is now many Liberal Democrat Councillors to do so. Little did we know a year on Basic Income would pass overwhelmingly at our Autumn party conference into policy and be championed in Parliament by a number of our MPs.

Now, as we see the effects of the Coronavirus pandemic hit our society harder than ever before it is essential for Liberal Democrats to be pioneering and spearheading the charge towards making Basic Income a reality.

This, of course, comes with challenges.

Sceptics, of which I was one, always say,  “no one’s heard of it”, “we’ll never be able to make it work” or “it’s just for policy wonks” but the pandemic gives the idea of Basic Income limelight. It gives Liberal Democrats a lightbulb moment that can commit us to a caring society where no one gets left behind.

A Basic Income is explained simply – it is a fixed, unconditional, universal payment to all in our society. It has the power to be a great leveller to the economic insecurity Coronavirus has exposed.

A Basic Income would have seen the free school’s meals meltdown from government melt away with parents having a safety net. A Basic Income would see those who have fallen through the cracks of Covid support catered to and supported. A Basic Income, if championed by Liberals, could be our generation’s answer to the National Health Service.

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What is the Tories’ problem with feeding children?

Just when you think that the Tories couldn’t sink any lower than their opposition to providing help to families with free school meals during the holidays, they have gone one further.

All over social media, there are pictures of the sorts of food packages that are being sent to children who would normally qualify for free school meals.

Daisy Cooper has written to the Education Secretary to ask him to investigate and sort this out – by giving vouchers to families rather than these “woefully inadequate” and “abysmal” packages:

It is completely unacceptable that parents have received woefully inadequate food parcels in place of free school meals.

The amount of food parents have received to feed their children is not anything like enough to provide an adequate, nutritious lunch every day. Nor do they appear to represent value for money, given what the parcels should theoretically be worth.

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The case for a partial UBI

My local party proposed an amendment to the Conference UBI motion setting a medium-term aspiration. We proposed that the UBI level together with existing working-age benefits should equal either the Social Metrics Commission or the Joseph Rowntree Foundation calculations of what a sufficient income for a person is to meet their basic requirements. It was not selected for debate. The reason given was that the Federal Conference Committee thought that it could restrict the implementation options to be considered by the Federal Policy Committee! This seems to me to be an odd reason. I think Conference should have been given the opportunity to set out what level of UBI they are aiming for even if it is only an aspiration for the medium-term which would have given lots of wriggle room to FPC.

When considering a UBI we need to be aware of the gross costs of any proposal and not be misled by the idea that a scheme is affordable because we can make huge changes to the tax and national insurance system we have today.

The Social Metrics Commission state that a single person needs £157 to meet all of their basic needs excluding housing. The gross cost of setting a UBI at this rate would be just over £353 billion. If instead the working-age benefit level was increased to the poverty line of £157 for single people and £271 for a couple, this would cost in the region of £53 billion. A difference of £300 billion.

Some people suggest that a UBI can be paid for with a Land Value Tax. When we agreed to the replacing of business rates with a Commercial Landowner Levy, our name for this land tax, we set the rates at 59% in England and 67.5% in Wales of the ‘land rental value’. We stated that we would raise £25 billion a year from this tax. The maximum rate we could tax the rental income from land is 100% and this rate would only increase government income by less than £17 billion. A small fraction of the cost of a worthwhile UBI but a useful amount in paying for increasing the working-age benefits only.

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Basic Income – from party policy to electable manifesto commitment

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Having long campaigned on LDV for Universal Basic Income, it was heartening to see UBI adopted as party policy at Conference. The challenge now is to transform Conference vote into a credible manifesto commitment, and a persuasive electable UBI policy.

Recent LDV articles have advocated UBI on various grounds, including Leyla Moran on precarity, Paul Hindley and Daniel Duggan on social justice, Anton Georgiou on inequality, and Jane Dodds on empowerment. Others including  Malcolm Berwick-Gooding have asked how UBI can be funded. Chris Northwood and George Kendall have proposed income tax, and Darren Martin a transaction micro-tax.

The web site The Case for Basic Income seeks to set out the main arguments for UBI. These are

  • social justice, addressing inequality, including gender inequality
  • welfare system efficiency and effectiveness, avoiding intrusive means-testing
  • economic necessity, acknowledging work reduction through automation, avoiding economic crisis and austerity
  • human flourishing, enabling wider choice of lifestyle
  • environmental responsibility, creating income other than by employment and more output

These are powerful, appealing, and convincing arguments, which we should fully deploy.

We also have to respond to the two main counter-arguments. Many claim that UBI presents a work disincentive. But in fact, it is current welfare benefits which erect a disincentive to work by being withdrawn £ for £ if a recipient finds work, creating an enormous marginal rate of tax, and hence the infamous ‘unemployment trap’. UBI avoids this as it is retained in full if someone starts to work.

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Speeches of #ldconf: We are liberals. We give people the tools to make their own choices

On Lib Dem Voice: Reportage | Contribute
On the official party website: Conference home


Harrow’s Adam Bernard proposed the Universal Basic Income motion last night. Here is his speech in full:

Conference,

In the preamble to our constitution, the basic statement of our values, we aspire to a society where “no-one shall be enslaved by poverty, ignorance or conformity”.

——–
In a motion about Universal Basic Income, you’d expect me to talk about poverty — and I will — but I’m going to start by talking about conformity.

I’m going to talk about conditionality and why it’s bad.

Conditionality is where we say “We’ll help you if you’re poor, but *only* if you’re the *right kind* of poor person”

It’s where we say: “Of course we’re nice. Of course this is a caring society. Of course we’ll help you. BUT first you have to prove that you’re poor enough. Prove that you’re disabled enough. Prove that you’re mentally ill enough. Prove that you’re looking for work in the right way, apply for jobs in the right way, jump through all the hoops, take what you’re given and don’t answer back.”

THAT’s conditionality. And this motion says we should get rid of it.

——–

Over the last few decades, conditionality has increased. It increased under Thatcher and Major. It increased under New Labour. It increased — to our utter shame — under the coalition. And it’s still increasing now under the Tories.

And every increase has a nice, *rational* explanation — reducing fraud, maybe, or incentivising work.

But in fact every increase in conditionality means more stigma, more pain, more families unable to put food on the table.

——–

William Beveridge — one of our great Liberal success stories — identified his Five Giant Evils: “Want, Disease, Ignorance, Squalor, and Idleness”.

He attacked Disease not by setting up “poor hospitals” only for those deepest in poverty, but by laying out the framework for the NHS, which provides care to all, rich or poor, no questions asked.

Now, in the 21st century, we are calling for the same approach to Want. A regular payment, sufficient for basic needs, to everyone in society. No stigma, no questions asked.

Yes, this will mean to rich people as well as poor people. And you should feel the same outrage at that as when rich people use the NHS, send their kids to state school, or receive a state pension.

Yes, this will be expensive, just like the NHS is expensive, like state education is expensive, like the state pension is expensive. But we know that we can’t afford *not* to have those services in a modern, fair society – and we can’t afford not to have an absolute solution to poverty either.

——–

And what about Beveridge’s giant of Idleness? Aren’t we encouraging people to be lazy?

Our society has a myth that, say, cold-calling people to ask if they’ve been in a motor vehicle accident is paid work and *therefore* is a valid and *dignified* way to spend your life, but bringing up your child, caring for your elderly parents, or volunteering to help your community is not.

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Virtual Conference shows how Lib Dem members can change our policy

On Lib Dem Voice: Reportage | Contribute
On the official party website: Conference home


Adam Bernard, who was our candidate in Harrow East at the last General Election, and James Baillie, a leading voice in the Radical Association have spent much of the past five years trying to persuade the party of the merits of Universal Basic Income.  They campaigned and networked and worked with others, including the Social Liberal Forum to build the case for UBI. They have put huge amounts of energy into persuading people that this was the way to go.

When Coronavirus exposed the inadequacies of the social security safety net, they tried again to get this issue debated at Conference.

This time, it was not only chosen, but it had the full backing of the Parliamentary Party.

Last night, Adam proposed the motion which called on the party to campaign for a regular payment to all UK residents, funded in a socially just way and to ensure that people who need it still have access to support for housing and disability support.

He had the support of Jane Dodds, the Welsh Liberal Democrat Leader and long term advocate of UBI and Wendy Chamberlain, our DWP spokesperson. Christine Jardine had been making the case for UBI all over the media. She wrote in the Mirror yesterday that UBI could be our generation’s NHS:

A basic income will be the best, fairest and simplest way to safeguard the most vulnerable in society and care for those who need it.

At the time of the creation of the NHS, doubters opposed the idea at every turn, yet now we treasure it.

Through this crisis, our pride in the institution and in the principles which created it have been palpable.

That post-war generation’s achievement has been the salvation of so many in this one.

Providing a fixed universal income to everyone with no stigma attached has the potential to be our generation’s National Health Service.

We need the states role to be helping people out of poverty and creating the equality of opportunity that leads to a prosperous life.

We must free people from the insecurity and anxiety that this virus has created and will be with us long after we have beaten it, and instead empower them to live their lives with security, dignity and freedom.

There were some fantastic speeches in the debate on both sides. Concerns were raised about affordability and whether the payment would be sufficient to meet people’s needs. Sheffield’s Laura Gordon had technical problems and was cut off mid speech and had to come back in for her 90 seconds but made her concerns about practicality really well.

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Selling UBI: making it a good policy that wins us votes

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This is a follow-on post to the one published yesterday.

The real issue with UBI is not economic; it has been shown to provide no disincentive to work and most people are just paying in cash via taxes and getting that cash straight back. It doesn’t really affect most household finances to any significant degree. Instead the problem with UBI is political. How do we make it popular and keep it simple? That’s what my proposal is about.

The elevator pitch is this: “Voters are clear that they want tax dodgers to pay their fair share. That’s why the Liberal Democrats want to use taxes that are hard for the super rich and corporations to avoid and then, to make absolutely sure everyday voters don’t get taxed unfairly, we’re going to send you each a cheque from the proceeds. Think of it as a VAT rebate.”

Voters really are clear that they want higher taxes on the wealthy and corporations. This reframes the discussion in economically populist terms (something Liberal Democrats tend to hate doing but works) but it doesn’t change the policy at all. It remains good economics and it really does allow us to shift towards using taxes the wealthy and corporations find hard to avoid. The Scandinavian countries, for example, make heavy use of goods and services taxes for this reason.

Now I know Lib Dems are going to want to use Land Value Tax. That’s economically sound obviously, but that’s selling two hard things at once. I’d propose this:

We would give a universal basic income of £40/week to everyone in the first year of the parliament, paid for by raising VAT. That would rise by £40/week each year of the parliament until we hit £200/week in the final year. That’s £10,400 in that final year, presumably 2028 so £10,400 will be worth slightly less than now due to inflation. By the time we get to the final couple of years we can use LVT to get up to the full amount. VAT plus a UBI is progressive and the Scandinavians have shown it doesn’t slow economic growth.

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Liz Jarvis on her experience of unemployment as a single parent

An article with the headline “I lost my job in the last recession. I know how difficult it will be for single parents this time” is compulsory reading, especially when written by a journalist who is also a Lib Dem member.

Liz Jarvis gives a very personal account of the impact of the recession on her and her family:

Every time more job losses are announced during this crisis I think of all the people behind the headlines, the lives affected, and the knock-on effect for local communities. I lost my job in the last recession and all opportunities seemed to vanish overnight. As a single parent of one, my little family’s financial situation quickly became very precarious indeed. For six months I struggled to find any regular paid work at all, and I was at risk of losing the roof over our heads.

The speed at which all this escalated was terrifying. As the bills mounted up I started to dread every text message, every phone call, every letter. The credit crunch had already bitten. I sold what I could and sometimes skipped meals so my son could eat. We had been on our own since he was 18 months old and being able to provide for him was massively important to me.

Like those excluded from government support during this crisis and the “forgotten freelancers”, because I had been on a contract I wasn’t entitled to much in the way of benefits, and had never been in the position to save for a deluge of rainy days, I applied for countless jobs and temp positions without receiving any reply. Christmas saw me scouring recruitment sites.

And she goes on to consider the current crisis and its impact, especially on women:

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Which UBI should we support?

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In his recent piece HERE George Kendall asks us which Universal Basic Income proposal we should choose and how can we say if it’s affordable? How should UBI advocates respond?

What I intend to do here is set out how I believe we should assess each UBI proposal that comes our way; however, the first step is to accept the principle of UBI at conference and acknowledge it needs to be a high enough amount to live on. My conclusion will be that an “out of the box” proposal like that from Compass is actually just fine but that Lib Dems should debate several options once we’ve accepted the principle.

What makes costing UBI complicated is that normally governments take in tax revenue and spend it in return for some particular thing. For example we might decide to spend another £100 billion on the NHS and we must decide if that thing, i.e. the extra NHS services we get as a result, are worth the cost, the £100 billion. UBI isn’t like that. In UBI the government takes in, say, £500 billion and then hands out that same £500 billion. We don’t get a product or service and most of us get some amount of the cash we paid in back as… well… cash.

If I hand you £100 and you then hand me £100 I’m not £100 worse off am I? If I hand you £100 and you give me £80 I’m not £100 worse off, I’m £20 worse off. That’s very different from spending £100 and then getting a mobile phone. Is the phone worth £100? Can you get a good phone for £100? Those questions don’t make sense with UBI in the way they do with healthcare.

Instead what we are “purchasing” is a guarantee of no poverty for any UK citizen and the cost is not the whole tax bill but instead it is any loss of incentives to work and any inflation that may result. This is where evidence really matters! We are an evidence based party so lets consider the evidence.

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Let’s tackle entrenched inequality with a Universal Basic Income

As a local Councillor in one of the most diverse wards in London, I am acutely aware of the entrenched inequality that exists within certain sections of the country. This has been further tragically exposed by the current coronavirus crisis. My ward, Alperton, is amongst the hardest hit in Brent, with one of the highest death rates in the borough.

Government studies which show the disproportionate way that this virus is impacting certain ethnic groups and also a Brent commissioned poverty report published in August, seek to shed a light on why my borough was so gravely impacted. In some respects, it was a perfect storm – high levels of poverty, exploited front line workers, many of whom are from ethnic minority backgrounds and overcrowded, poor housing that allowed the virus to rip a hole right through our community; one that will take a lot to heal and recover from. 

It is clear that the only way to recover and ensure that the most vulnerable groups are safeguarded into the future is to seek to address the inequalities that exist in our country. That is why I wholeheartedly support the introduction of a Universal Basic Income. A guaranteed annual income for every citizen provided by the Government.

As a party, the Liberal Democrats have always been at the forefront in calling for major social change to tackle the big issues we face. It is absolutely right we do so again now. 

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What kind of Universal Basic Income do you support?

There has been a lot of debate in the party about Universal Basic Income, but it’s not always been clear what kind of UBI is being proposed. This article is to ask you to choose from four clear options.

A key issue with UBI is how it will be funded, and if it is funded, whether other priorities will have to be dropped. In the 2019 election, Jeremy Corbyn proposed raising taxes by £80bn/yr. The Liberal Democrats proposed an extra £51bn/yr spending (this included a £14bn/yr ‘remain bonus’)

The four options below involve combinations of the cheapest of the schemes recommended by Compass and the spending from the 2019 Lib Dem manifesto.

  1. £191.9bn/yr extra taxes

Scheme 1 from the Compass paper (see below), plus the £51bn/yr spending from the 2019 Lib Dem manifesto

  1. £140.9bn/yr extra taxes

Scheme 1 from the Compass paper (see below), none of the 2019 Lib Dem manifesto implemented

  1. £61bn/yr extra taxes
  • Keep the £51bn/yr extra spending from the 2019 manifesto
  • £10bn/yr to move the UK benefits system more towards a negative income tax system
  • A UBI pilot scheme (cost very small)
  1. £51bn/yr extra taxes
  • Keep the £51bn/yr extra spending from the 2019 manifesto
  • A UBI pilot scheme (cost very small)

The UBI Scheme 1 in the above options comes from proposals in the paper written by Howard Reed and Stewart Lansley and published by Compass. It is outlined in the graphic below, along with Scheme 2, which is more expensive.

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As well as saying which of the above four you prefer, do also give us your ideal option.

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Jane Dodds writes: With a liberal basic income, we can invest in everyone

As conference season arrives we have a unique opportunity to pass a policy that in the 21st Century is part of the essential foundations of a more liberal future for our country – that policy is a Universal Basic Income.

Supported by both of our leadership candidates and pioneered by the late great Paddy Ashdown the time for the Liberal Democrats to take the step and be the main political party backing a Basic Income is now.

We know that Coronavirus has lifted the lid on the widespread financial insecurity that hardworking people and families have to deal within the UK. For many – from freelancers to those on zero-hours contracts – there is simply no meaningful safety net in place for times of crisis. This fundamentally undermines everything we believe in, and everything we want to achieve.

Our message is the Liberal Democrats can provide the basic financial security everyone needs in these testing times with a Basic Income. It would be a fair simple way to do what us liberal do best – empower people to dream big and reach their full potential.

As Liberal Democrats, we believe in the essential goodness of humankind – that, given the opportunity, in most circumstances, most people will choose to do good rather than harm. That’s why we believe putting power in people’s hands is the best way to a good society.

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Let’s become the Party of the Universal Basic Income

September will mark 10 years since I attended my first Liberal Democrat Conference, albeit this year’s Conference being entirely online. Having attended most Federal Conferences over that period I have witnessed numerous debates on topics ranging from public services to constitutional reform and from scrapping Trident to building more houses. 

Lately, several of the motions that have come to be debated at Conference have been very uninspiring; all motherhood and apple pie, while not wanting to scare the political horses too much. Can we truly call something a debate if 99% of conference goers are already in favour of it? When we look back at the party’s history, we see moments of great policy radicalism and an unflinching willingness to be the shapers of the big ideas of tomorrow. A liberal party, especially a liberal party with only 11 MPs and currently on single digits in the polls, needs to be bold, radical and imaginative in its policy development.

I was therefore delighted to see that a motion on the Universal Basic Income (UBI) has been chosen to be debated on the evening of Friday 25 September. The Universal Basic Income is the idea that all citizens should have an unconditional guaranteed minimum income. It would enshrine the principle that everyone has the right to own some capital. A UBI would guarantee a social minimum for the poorest members of society and would be the jewel in the crown of the party’s commitment to social justice. I welcome the motion’s commitment to guaranteeing continued additional income support mechanisms for people in receipt of housing and disability support payments. I also welcome a UBI being rolled out on the basis of the best available international evidence.

A Universal Basic Income would deliver essential social protection for those who fall outside traditional realms of employment, such as carers, students, parents with child caring responsibilities, as well as continuing to deliver welfare support for the elderly, the unemployed and people with disabilities. It would also help to raise the income of low-paid workers and those in precarious employment situations. It would help to remedy the injustices faced by the so-called ‘WASPI women’ who have lost out financially as a result of changes to the pension system. Finally, it would give additional financial support for those wanting to pursue a new vocation (such as becoming a musician) or to set up a new business, where there may be a significant period of time before a secure income can be received.

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Leadership candidates could and should set out what they mean by UBI

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Universal Basic Income (UBI) has many attractions as a policy. It is radical, an easy concept to explain and – depending how it is implemented – may be progressive.

Both our leadership candidates are backing it. Neither has been as specific as they could and should be about what they are proposing. There is enough economic analysis available for it to be perfectly feasible for them both to be more specific.

The fundamental question is whether we can afford a level of UBI which is worth having and does not create lots of losers, particularly at the bottom end of the income distribution if means tested benefits are withdrawn or modified.

On the economics, our candidates refer mainly to analysis completed by Compass, a think tank promoting UBI.  This is the most detailed recent economic work that is publicly available on a UBI for the UK.  The work has some gaps (which it acknowledges) but it does us a big service by showing the relationships between costs and benefits, and by considering properly how different income groups are affected.

It is not honest to say blandly that the Compass analysis shows that ‘UBI works’.  But it does show what the constraints are, and means our candidates could say more precisely what they are proposing.

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Funding a Universal Basic Income through Income Tax

A couple of years ago a friend gifted me a copy of Rutger Bregman’s “Utopia for Realists”. It ended up close to the top of my “to read” list and got read not long afterwards. Utopia for Realists makes a series of very clear and well reasoned arguments for a number of policy interventions that result in a better society. That one of the core premises is that a better society is an equitable one is one that should appeal to all Liberal Democrats – it’s very in keeping with the vision in the preamble of “no one shall …

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How to make a just society – Justice Capitalism then UBI

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UBI (Universal or Unconditional Basic Income) is a brilliant idea. A majority of people support it. Let’s implement it worldwide. But to pay for it, we first must enact Justice Capitalism, that is, Capitalism that is fair, equal, and balanced for everyone.

But how will UBI be funded? The Tax system is broken and cannot be fixed to pay for UBI. Governments have been trying to fix the tax code forever, but it just gets more complicated with more and more loopholes. Corporations, criminals, corrupt politicians, and the 1%, hide money in Tax Havens or they game the tax rules to pay little or no taxes. Actions such as tax increases and eliminating tax havens will contribute to funding UBI but this will not be enough for the long term. Printing money, as is happening now, is also not a good solution to fund UBI as it just creates inflation which has too many negative consequences.

The best way to fund UBI is by Justice Capitalism.

The money should not come from taxation, but a dividend, financed from the returns on all our human capital; a “public” percentage of companies’ profits. Also, we will eliminate tax havens and the estimated $32 trillion hidden there. We will institute a tax on extreme wealth, a speculation tax (i.e HFT High-Frequency Trading), and a robot tax on firms that eliminate jobs by AI/automation. With this start to funding UBI, we will implement it.

Watch economist and former Greek Finance Minister @yanisvaroufakis explain it in a 4-minute video: #JusticeCapThenUBI

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The social justice argument for a Universal Basic Income

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Recently, there has been much discussion regarding the desirability of a Universal Basic Income. Arguments used to justify it range from providing security, to alleviating poverty, to increasing freedom, to nurturing a sense of social cohesion. However, one of the most persuasive arguments is that based on justice: on each getting what is their due.

Historically, liberals have tended to be most familiar with, and sympathetic to, John Locke’s justification of property ownership. For Locke, the world initially belonged to everyone, but by individuals mixing their labour with land they came to own it (the possibility that such individuals should simply lose their labour seems not to have occurred to Locke). As long as those who do not possess land, including their descendants, are better off than they would have otherwise been (those who, for example, own no land and work the land of others have, Lockeans would suggest, avoided the ‘tragedy of the commons’ and are thus better off) then the distribution of property, including to later generations via inheritance or sale, is justified.

However, another liberal tradition, one we might call a ‘left-libertarian’ one, and including Henry George, a proponent of a Land Valuation Tax, takes a different view. The world was, and remains, commonly owned; we are all joint heirs to the world. For the left-libertarian, those who claimed ownership of land deprived the community of its assets and, as a result, those who benefit from land ownership today, whether by inheritance or sale, may be likened to the recipients of stolen goods; the passage of time does not turn a wrong into a right. As the Victorian thinker Herbert Spencer wrote in 1851, “The original deeds were written with the sword, rather than with the pen: not lawyers, but soldiers, were the conveyancers: blows were the current coin given in payment; and for seals, blood was used in preference to wax” (Spencer would later adopt a much more conservative attitude towards land ownership; some time ago I purchased a letter by Spencer in which he made clear his refusal to permit the republication of the above and other similarly offending passages). Essentially, for such left-libertarians, much wealth today rests on illegitimate grounds.

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In debating UBI, we need to be clear what we’re talking about

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In Stephen O’Brien’s recent post on this website entitled “Why we shouldn’t just jump on the UBI bandwagon”, he makes a series of points in opposition to a Universal Basic Income (UBI). The difficulty with his criticisms is that he argues against a version of UBI almost nobody is proposing. If we are to have a constructive discussion about UBI as a party, we need to make sure that both supporters and detractors are talking about the same thing.

First, the £830-a-month proposal Stephen critiques appears to be plucked out of nowhere. There has been no substantive proposal along these lines made. If we were to agree on the principle of UBI, we would of course need to work out precisely how it would work and the exact level it would be set at. In order to be a “basic” income, however, it is likely that it would need to be higher than this, neutralising any objection that Universal Credit currently provides more than UBI would.

Stephen also makes an assumption that UBI would totally replace all existing welfare benefits full stop. So, in the example he sets up to criticise UBI, he implies that it would abolish all disability benefits. This is a proposal I have never heard being made by anyone who supports the policy. Almost all its major supporters agree that there would have to be uplifts for those with disabilities, and in other categories. Nobody would lose out.

In general, it should be noted that the primary point of UBI is to eradicate economic insecurity. A key cause of economic insecurity is the waiting period for welfare payments, inherent in our current system: the Trussell Trust views it as the reason for a significant proportion of food bank usage, for example. This delay is an in-built feature of the current welfare system, and other programmes like a negative income tax (NIT). UBI abolishes it entirely by giving all people unconditional payments. Under it, nobody ever has to wait to be assessed and processed when they suddenly fall on hard times.

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Why we shouldn’t just jump on the UBI bandwagon

While debating other liberals about Universal Basic Income (UBI) it occurred to me that UBI isn’t a voter winner, certainly outside of London. Nor is it actually workable.

One policy, suggested on Lib Dem Voice by Darren Martin, was to pay a £830 Univeral Basic Income to each citizen age 15 and over. This would be an increase to average incomes for those aged 15-24, but when you study the policy closer you begin to see huge faults with it.

This policy would actually have a negative impact on those aged 25 and over who claim some support at the …

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LibLink: Alistair Carmichael: It’s now time to consider a Universal Basic Income

Last week, Alistair Carmichael wrote an article for the Herald calling for a Universal Basic Income to be considered as a key part of the strategy for an economic recovery.

He cites practical examples of the people who are falling through the Government’s various support plans:

Thousands of families will face financial hardship in this crisis due to the current gaps in Government support.  The small building firm in Shetland that I have been trying to help in recent weeks illustrates the problem well. It is owned by the two men who started it and runs as a limited company.  The owners take most of their income though dividends. Their four employees have been furloughed and their position ought to be secure.  As things stand, however, there is no adequate help for the two owners of the business. The purpose of the furlough scheme is to protect jobs now for when productive work restarts.  Unless we find a way of helping these business owners, and thousands like them, there will be no business to which the employees can return.

While he is not yet totally convinced by UBI as a long term strategy, he thinks it needs to be properly considered as a way to remedy inequality – and says that the State Pension is essentially a form of UBI for older people:

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Universal Basic Income, why now?

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We are currently in the midst of an unwanted sociological experiment.

Society is reliant on its citizens being responsive to the current restrictions in a way that cannot realistically be enforced by coercion.

The lessons to be drawn can offer us significant hope. A hope that, as a counsellor working in mental health, I have always had. It is a hope in the possibility of the majority to find a way to do the best for themselves and others.

An army of volunteers have been found. Neighbours are mostly, neighbourly. Politicians have asked that citizens be trusted to pay their part in the current challenges and we have not been found wanting. (Apart from my own glass recycling, I include myself in this). In the counselling room I see that the human spirit has both conscience and drive, often in the face of appalling experiences.  Daily I see people trying to find a way to become the person they want to be, across all social groups, often hampered by shame of circumstance.

The radical idea of Universal benefit has been floated by economists and idealists since Tudor England and the writings of Thomas Payne, but those holding the mindset of the poorhouse have never trusted that “handouts’  wouldn’t create a culture of workshy reliance.

The truest form of Universal Basic Income (UBI) provides a base to all via the income tax code. It could equalise the starting point of income for all at a basic minimum. Zero income means a negative tax rate (a credit)  but it is not about making all equal, although less inequality is inevitable.

UBI is and should be seen as the provision of stability.

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Rennie calls for UBI summit to help those who can’t get government support

Scottish Liberal Democrat leader Willie Rennie has today called for an intergovernmental summit on a universal basic income to take place to ensure that support is urgently made available for those who have fallen through cracks of the current furlough and income support measures.

He highlighted the plight of self-employed workers who were not trading for the entirety of the last tax year, PAYE freelancers,  self-employed workers who are paid in dividends, people who work from home and those who have recently changed jobs as examples of people who have experienced a sudden and dramatic loss of income as well as those struggling to access existing anti-poverty measures.

Across the UK, the Institute for Fiscal Studies estimate that roughly 675,000 people will be ineligible for the government’s Self-Employed Income Support Scheme, which mirrors the 80% wage subsidy scheme for the employed.

The IFS says another 1.3 million people with some self-employment income are likely to be ineligible because they received less than half of their income from self-employment last year.

His call comes as the The Poverty Alliance, Scotland’s anti-poverty network, has identified a number of shortcomings in the current crisis responses, including a lack of targeted social security support for families with children at either the UK or Scottish level, limited access to community care grants and gaps in employment protection programmes.

Willie said:

I fully understood and supported the decision to use the existing tax and spend apparatus to help people financially. Time was short and we needed to act fast. Now that those schemes are getting into place we need to take the next steps.

With economic uncertainty destined to loom for the foreseeable future, we need to ensure that everyone can afford to keep a roof over their head and a meal on the table.

We should be adopting the principles of a universal basic income: no one should be left behind. The UK Government has acted swiftly to back businesses and support furloughed workers but too many are slipping through the cracks and there’s a real risk that furloughed staff will lose their jobs when the current scheme ends.

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Jane Dodds writes: No going back to business as usual

Covid-19 has caused the biggest economic shock of modern times. The Government has announced a range of measures to support businesses and the self-employed, in particular through putting in place strong incentives to keep staff on the payroll. Nearly a million people applied for Universal Credit in March – and the Welsh Liberal Democrats have called for the Government to scrap the five-week wait.  We need to get money into people’s pockets now. 

But we need to think beyond the emergency. Economic recovery could be slow and painful, and the most difficult time for families and businesses – especially the small businesses in the economic front line – may be when the lockdown is over and the short-term, time-limited measures announced by the Treasury fall away. Our family businesses are at the heart of our communities, and we need to ensure they bounce back stronger and more resilient than before. These shops and businesses will only recover if their customers have money to spend once the lockdown ends.

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A market-driven approach to Universal Basic Income

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By now most Liberals are convinced of the moral impetus to eradicate poverty, and many are now realizing that the easiest way to resolve this is to “give people money”. Slowly, we are detaching ourselves from the idea that people should be forced to work in exchange for their rights – and waking up to the need to meet Socialist means for providing Social Security (large, state-driven delivery models) with a Liberal alternative.

A Universal Basic Income is not a panacea, but it’s a surprisingly useful tool for delivering both Liberal outcomes and meeting our Human Rights obligations. And with a market-driven approach, we can embed it in society, free of the partisan nature of British Politics.

Step 1: Create a National Basic Income Fund. This is important – it’s tempting to break up the fund, but you’ll see later why that will create problems. Model it on the Norwegian sovereign wealth funds, or base it on the UK National Insurance Fund. I don’t mind; this sounds like something other people would enjoy arguing about. Just create it.

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The compelling case for a national Universal Basic Income trial

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Coronavirus has lifted the lid on the prevalence of financial insecurity in this UK. For many, there is no safety net in place for times of crisis. So, now more than ever, we need progressive, forward-thinking solutions to help people cope.

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Jane Dodds writes: Why UBI is the only way forward

Over the past few weeks, we’ve seen the spread of Corona Virus continue at a frightening pace. Countries around the world are taking increasingly more authoritarian steps to try and contain the spread before it is too late to stop it.

A consequence of this has been millions of people left in limbo, unsure of what they’re going to do as the lockdown increases. Across the UK schools have closed and many businesses are slowly shutting down due to concerns over staff/customer safety and lack of custom.

But as the UK grinds to a halt, people’s lives simply do not stop. People still have bills coming in, they still have a mortgage/rent to pay and they still need to be able to put food on their table. However, for many even funding these bare essentials will be difficult.

Many small and independent shops are having to lay off staff or close outright, this means for many thousands of people their source of income and livelihood disappears overnight. I welcome the recent moves by the UK, Scottish and Welsh Governments to support small businesses, but they simply haven’t gone far enough to support people themselves.

So, what happens if you lose your job due to Covid-19? You’re either forced to try and find a new job very quickly (almost impossible given the economic standstill) or apply for Universal Credit.

Universal Credit is an abhorrent system, one which lacks any compassion or grounding in reality. How is someone supposed to go five weeks without any support? How are they supposed to feed their families and keep up with their bills on just £80 a week?

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Why the Lib Dems need to lead the charge for #EmergencyUBI

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Here in Hull, where I’m a Liberal Democrat Councillor, I was proud that in January we moved a motion that, with unanimous support called on the Government to run the first UK pilot of Universal Basic Income (UBI). This would see every person receive a fixed amount of money to free them from financial insecurity – protecting the most vulnerable in society.

It’s safe to say much has changed since January, but the issue of Universal Basic Income is more important than ever before. The Corvid-19 virus has plunged our nation into chaos and shown how financial insecurity through the nation is rife. We have a duty as a progressive party that champions freedom to act.

I was delighted that one of our leadership hopefuls Layla Moran backed our cause in Hull to the hills and even more so that she has recently written to the Government calling for an emergency UBI.

Liberal Democrats up and down the country should be championing this policy especially given its clear advantages in times of crisis.

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