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.

Differentials in income, after basic needs have been met, will arise from individual decisions on how to use that money, whether in training or entrepreneurism for later prosperity, in supporting volunteering for life satisfaction or simply as appropriate financial compensation when bearing caring responsibilities.

What this could do is to minimise the increasing precarious nature of work in the modern technological period. The Reform Society and the SNP have endorsed this but stop short at providing a viable income, so the (expensive) machinery of the welfare state inevitably would have to trundle alongside their plans. How about being really radical and aiming for a sufficient UBI?

I will leave the economists to run the numbers on the impact on our mental and physical health, but I would wager it would be significant. The explosions of chronic ill health and depression and anxiety amongst all ages seen in my consulting room has been allayed with an increasingly unstable work culture.  Regular reliable income offers the chance to plan, to invest in yourself, to look up  and onwards. A by-product may be greater diversity in all walks of life as it equalises access to opportunity.  I’d also hazard a guess that school money management classes for 15-18 year olds might  be well attended if at 18, an income was likely.

As to how to fund it, perhaps by a mix of all possible sources: income, corporate and an effective wealth tax. To date, pre-Covid,  it has been the corporate sector that has profited from increasing power and lower wages in relation to its workforce. The economy would likely benefit from an increase in funded consumer demand.

As a person concerned with our state of minds, adult and young, I can only ask policy makers  to be open to an idea of  under-pinning the population through their life. To do so is to acknowledge the reality of underemployment, employment with maximum earnings and times of lower pay that is experienced by the workforce now.

It is also to offer to the individuals they represent the trust and respect they have so evidently earned.

* Jane Alliston is the Scottish Liberal Democrats' Mental Health Spokesperson

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  • Peter Martin 8th May '20 - 8:27am

    A UBI is a neoliberal plot to make us all poorer

    It is sold as a progressive, almost socialist, measure to promote greater equality.

    However, a closer look at how UBI is expected to work shows it is intended to provide political cover for the elimination of social programs and the privatisation of social services. UBI has been endorsed by neoliberal economists for a long time. One of its early champions was the patron saint of neoliberalism, Milton Friedman. Jane Pickard doesn’t mention him! In his book Capitalism and Freedom, Friedman argues for a “negative income tax”, which is just another term for a UBI, as a means to deliver a basic income.

    A UBI will not alleviate poverty and will help turn social necessities into products for profit. Instead of giving the poor, including the mentally and physical handicapped, a sum of money and told to make themselves scarce we need them to be as unscarce as possible. Nearly everyone has talents which should not be allowed to run to waste. The only way to prevent that is to guarantee a job to everyone who is able to do a job. Those who aren’t can be put on semi- permanent sick leave.

  • @Peter Martin – you seem to have a very patrician view of people. Who said anything about telling people to make themselves scarce? You seem to think that people can’t have any instinct or ambition to work or progress without the constant threat of poverty as a motivator.

    The main beneficiaries of the current system are bad and exploitative employers who know that their employees are trapped in poor working conditions by the knowledge that if they leave without another job to go to immediately, they face hunger and poverty due to the long wait for UC.

  • Jane – what level/amount should UBI be set at?

    Peter – is neoliberalism not liberalism? Why is it bad? What is wrong with replacing (not eliminating) existing welfare and privatising the provision of it? That said I’m not clear how you can privatise UBI?

    Mandating people work a guaranteed job based upon the ‘talent’ a bureaucrat deems them to have seems a lot less liberal than giving them the agency to decide what is best for themselves, underpinned by the financial stability Jane proposes.

    How can giving people more money not alleviate absolute poverty?

  • Peter Martin 8th May '20 - 9:16am

    @ Nick Baird,

    Telling those who don’t quite fit in to “make themselves scarce” is exactly what we do. Probably you and I have been lucky in that, when we’ve attended job interviews, we’ve known that we were in with a reasonably good chance of getting the job. All most of us needed to do to was make sure we’d had a haircut and that our shirts and trousers were pressed. That is until we start to get a bit older and then that doesn’t work quite so well any longer!

    It’s even worse for many people. Not just the elderly. So whilst sensible application of Keynesian economics can ensure most people can get jobs there is always going to be the problem of creating too much inflation before we get to a position of genuine full employment. The most acute problem is faced by those who have, as previously mentioned, some kind of disability. They don’t get a look in when in competition with the able bodied.

    So, accuse me of being “patrician”, if you like. But you, Jane Pickard and others are being duped by the right wing of the economic establishment who have never liked the idea of full employment. The UBI just gives them another excuse.

    It would perhaps not be too bad of an excuse if it was a generous UBI. A UBI sounds good providing it is sold in very vague terms. But start to introduce some numbers and it all falls apart. Make it too mean spirited and it solves nothing. Make it too generous and it becomes unaffordable. If you disagree, please lets see some calculations.


  • John Marriott 8th May '20 - 9:36am

    I tend to agree with Peter Martin – for once. UBI is a marvellous idea if we all behaved in the same way; but we don’t. You see, it’s what you do with your money that counts. I’ve used the analogy before, namely if, say, you gave a random selection of people, say, ten, £100 each, I’m pretty certain that, at the end of a certain period of time, some will be totally spent up, while one or two may have at least a couple of hundreds of pounds more. It’s a bit like giving some children their pocket money for them to head straight for the sweet shop.

    So, I think that some people can’t spend their money wisely? Well, yes, I certainly do. Now, on the other hand, if they had earned that money honestly, what they spend it on is up to them in an allegedly free society – private schools, second homes, round the world cruises, a flash car etc., etc.

    I believe that Beveridge reckoned that, for his system to work properly, there needed to be full employment and that’s something, obviously with exceptions for those, who, for whatever reasons, cannot work, it still seems to make sense to me. Yes, we ought to be able to trust people and, in most cases, we probably can; but unfortunately the occasional bad apple can often become the stereotype that is used to condemn those, who, for no fault of their own, struggle to make ends meet.

  • Katharine Pindar 8th May '20 - 9:37am

    As a counsellor working for many years in mental health, I completely disagree that introducing a UBI or any new kind of mass attempted financial remedy could provide ‘stability’, or any real comfort for people overwhelmed by anxieties. Just as people come as individuals to see a counsellor, so they need to find individual solutions. The world of work should be expanded now to allow everyone who wants one a job, and everyone who has some or complete need of the assistance of welfare benefits should be provided with enhanced provision to bring them up to the poverty line. And the people coming to the job centres and food banks must be treated, as Philip Alston showed they have not been officially for the most part, with respect and attention for their individual needs. As progressive politicians, we should be working towards helping people find their individual solutions, by confronting the great ills of our time in our society and demanding well thought-out manifold remedies for them.

  • Jane Pickard 8th May '20 - 9:44am

    Thank you for your comments . I’ll follow up on your recommended info.
    My concern particularly is that it is introduced in a half hearted way. As I mentioned in Scotland the proposal is at a level that isn’t a basic income at all it just becomes part of the complex mix of benefits.
    As to an appropriate level, can we look at where we begin to tax the population now as that sets the level at which we currently decide there begins excess and so taxable income.
    I fail to see why this would be excessively inflationary when it is set at a level of basic needs. Perhaps some level of food inflation is inevitable for food producers to be able to continue to survive anyway.
    Finally in relation to full employment , the other issue Is the reduction in economic jobs available as robotisation/ technological change continues. Effectively by raising corporate tax as part of the funding here you tax the robot to redistribute to the community where the job is lost. Unfortunately in today’s Britain, work when we had it pre COVID, does not alleviate poverty.

  • @john Marriott.

    Why is UBI and full employment (minus the exceptions you noted) incompatible?

    As to your point on inequality of outcome, how big a problem is that if absolute poverty has been erased?

  • Peter Martin 8th May '20 - 10:23am

    @ Jane,

    It is a fair point that work doesn’t, in itself, alleviate poverty. That can only be done by distributing the benefits produced by the efforts of those who are in work in a more equitable way. I would say that most people are fine about that. They don’t mind supporting those who may not be quite so highly valued by the free market providing they are doing what they can. The problem arises, the resentment will start, when people are paid above the poverty level to do nothing. That’s the bind UBI advocates are in. They want to say UBI takes people out of poverty. Unconditionally – by definition.

    We shouldn’t fall for the “robots are coming to take our jobs” line. On the one hand we are told that we have a labour shortage and the crops will rot in the field and on the other…….. It really makes no sense at all. If we do have more automation then that’s surely a good thing. We don’t use dolly tubs and mangles in the home any longer. We use the time saved by using an automatic washing machine to do something else. That’s the way it should work in the wider economy too.

    Probably now is the worst possible time to make any serious changes. Yes, there will be a recession but it could end up with stagflation as the productive capacity of our economy dwindles.

    There is a basic rule of macroeconomics – Spending equals income equals output, which in turn drives employment growth. In this crisis, fiscal intervention is aiming to reduce the fall in income arising from the enforced lockdown. But if the income from one period is cycled into the system next period, but output has fallen, then where does the spending go?

    No prizes for guessing that it will be into rampant inflation.

  • John Marriott 8th May '20 - 10:32am

    Where do you live? I bet it’s not in a refugee camp in Syria, or a favela in Brazil, to give just two examples. ‘Absolute poverty’ depends on how you define it. Shoot me down, if you want; but I would argue that, compared with some parts of the world, there is no ‘absolute poverty’ in these islands, thanks largely to reforms enacted after WW2. It looks as if none other than Katharine Pindar, whose enthusiasm for certain things I do not always share, has made most of the points that I would have made. With her pedigree, it’s frankly hard to top her. You need to get real.

  • This is change for the sake of change,much easier & sensible to focus on making universal credit work properly & focus on those that need support.

    UBI would create yet again another massive change with additional income for people that don’t need it supported by yet another government IT project!

  • Peter Martin 8th May '20 - 12:08pm

    @ Freddie,

    “What is wrong with replacing (not eliminating) existing welfare and privatising the provision of it?”

    You have to go back to the original source. And it is “eliminating”!

    To Friedman and his many powerful followers, the cause of poverty is not enough capitalism. Thus, their solution is to provide a “basic income” as a means to eliminate social programs and replace them with private organisations. ie Charities. Friedman specifically argues that “if enacted as a substitute for the present rag bag of measures directed at the same end, the total administrative burden would surely be reduced.”

    Friedman goes on to list some the “rag bag” of measures he would hope to eliminate: direct welfare payments and programs of all kinds, old age assistance, social security, aid to dependent children, public housing, veterans’ benefits, minimum-wage laws, and public health programs, hospitals and mental institutions. He claims that “a few brief calculations show this proposal to be far less costly”.

    Friedman also spends a few paragraphs musing whether people who depend on “Basic Income” should have the right to vote! To be fair to him, although I don’t like to do that, he grudgingly accepts that they should! But, all the same, he doesn’t like the idea that they should be allowed to vote for an increase in the UBI if they depended on it.


  • @ Peter

    Thanks for responding. It looks like Friedman shared our view here that poverty is a problem, and our debate is over the best solution?

    I still see a contradiction when you say UBI eliminates welfare rather than replacing it – the basic income IS the replacement (at lower total cost of administration – which is no bad thing surely?). The charities etc you mention would (and do currently) provide incremental support, but providing the basic income is set at the right level, I don’t see a clear problem with that.

    Fair enough if you think his proposal goes to far and eliminates things that aren’t replaceable by UBI , like social housing and public health, but just because his proposal goes too far – that doesn’t mean that Jane’s does?

    We could go into the suffrage/danger of tyranny of the majority but it’s outside the scope of what we’re debating on UBI. Ultimately, I think you’re in danger of throwing out UBI as a potential solution because you don’t agree with the wider principles /values of someone who has been a proponent for it previously.

  • I think it is more realistic to adopt a low level UBI that would run in conjunction with the current benefits system.


    Do you support any form of UBI?

  • Peter Martin 8th May '20 - 2:15pm

    @ Freddie,

    “……..but just because his proposal goes too far – that doesn’t mean that Jane’s does?”

    Possibly not. I’ll give you an answer when I’ve seen it. The OP is pretty vague. Its saying little more than wouldn’t-it-be-a-good-idea-to-have-a-UBI-to-solve-poverty-and-reduce-inequality.

    Once anyone starts to add some numbers as Joe B has done the problems start to become apparent. £4000 per person pa isn’t going to solve poverty. But once you start increasing it to a level which might, you’ll face the problem that, for many, there’ll be no point going out to work. Some will. Some won’t. The ones that do work will naturally feel highly resentful that they only end up with a similar income to those who don’t.

    The problem is that many on the centre left are only interested in how the available wealth is shared out. They aren’t interested in saying how workers should make their contribution. Those who are a bit further to the left have might have read and be sympathetic to this:

    “From each according to their ability and to each according to their needs”.

    Maybe the last part is being slightly too idealistic. But the first part certainly isn’t.

  • Agreed this is not about ending inequality but the stain of poverty and the generations raised in poverty.
    Also agreed that if you give people an allowance most will spend it, and that money will therefore recirculate, some will create more with it, and that creation really counts as aiding growth, job creation and entrepreneurship in the economy. Actually to use the analogy, when you give a recieve a ‘small’ amount (pocket money) it does get all spent on sweets or treats but an impactful amount I would suggest creates a place for more responsible longterm decisions.
    Recent past strategies have not seen a gain in Uk productivity. We have seen a huge increase in asset inflation due to monetary easing over the last 10 years which has benefited those with capital already, whilst Austerity hit hardest at those without. Lets hope that is not repeated.
    The majority in our community have proven themselves able to be trusted to act in their own and others interests and that to me is a game changer as evidence of the possibilities of this. Furloughed have sought to volunteer at all levels, not to sit back. I am not saying there wouldn’t be the outliers who would abuse this but must we approach policy from that standpoint.

  • Peter Davies 8th May '20 - 4:10pm

    You can justify UBI from a neo-liberal stance or a pure Marxist one. Whether you are aiming to minimise inequality or maximise incentives or find a sensible compromise between the two, a UBI and universal income taxation do it more efficiently than means testing, sanctions, arbitrary allowances, exemptions and tapers.

  • Joseph. William , Agree with much of your response. Interesting approaches. Switzerland is an example where asset wealth is taken into account in overall tax rates so incorporating land/ property. It meant historically investment funnelled to more productive investments. A Significant tax on profit from any property sales was also accepted as a fair consequence as the community location was part of the uplift in value and so community should benefit. Requires quite a mindset change in the Uk but generationally that may be already happening.

  • @ Peter

    I agree with Joseph when he says: ‘There are good reasons why UBI needs to be set at subsistence levels and not as so called relative poverty levels ( 60% of median income ‘after housing costs’) which are measures of inequality rather than poverty.’

    If UBI can solve destitution/absolute poverty for the 1.5 million people Joseph cites then we can look to other policies to deal with relative poverty including labour, housing and education.

    @ Joseph – Have you seen any studies about how affordable £4k per annum is say? It makes sense to me that instead of being universal, this should be targeted at those who don’t earn above this threshold already – a negative income tax. How many people earn below £4k per year?

  • Peter Martin – apparently UBI can reduce poverty rate (although marginally) in the UK because the UK’s current social programs are too weak.

    Look, the OECD study on potential UBI implementation in various countries show that the poor in Continental European countries would be worse off quite a lot. This is because UBI proponents want to cut all other social programs and use UBI to replace them, which will be disastrous (especially American right-wingers count Medicare and Medicaid as “social programs”).

    How about Universal Child Benefit, which works wonder and currently is already a thing in many Continental European countries? In Canada, Trudeau made Canadian Child Benefit near universal and his government lifted over a million people out of poverty in 4 years. The UK used to have Universal Child Benefit until The Coalition made it mean-tested.

  • Freddie – Friedman is an American, and it is fact that American right-wing UBI proponents want to replace all social programs with UBI, and they count Medicare, Obamacare and Medicaid as “social programs”.

  • And implementing UBI without slashing other programs will create a greater Financial Dunkirk than the Second World War. You simply cannot pay for that.

  • Peter Davies – “UBI and universal income taxation do it more efficiently than means testing, sanctions, arbitrary allowances, exemptions and tapers.” – this statement can be paraphrased as “let’s get rid of every single existing social program (e.g. child benefit, whatever UK equivalent of US social security…) and replace them with a single UBI” – which, well, actually will increase poverty in Continental European countries like Finland and France with strong social programs according to an OECD study. UBI only improves poverty marginally in the UK because the UK social safety net is already weaker than Continental Europe.

  • Rif Winfield 9th May '20 - 9:30am

    Please keep up the campaign for UBI. I should perhaps point out that UBI was the adopted policy of the Liberal Party in the 1970s. And it makes even greater sense now, as the world of work is cut back by crises like the present one, and by increasing automation. We can no longer guarantee full employment to everyone who wants to work, and that particular chimera will continue to shrink in future decades. Leave it to the Labour Party to foster that illusion. And make no bones about it – neoliberalism is nothing at all to do with the Liberalism we share; it is the economic philosophy of the right-wing Conservatives, all about economic freedom without concerbns for society, the freedom for a small portion of people to make money at th expense of the rest of us. True Liberalism, as set out by John Stuart Mill, John Maynard Keynes and William Beveridge, is about freeing ALL people in a society, even from the tyrany of compulsory work. I’m not denying the need to encourage people to work – in fact UBI would provide that incentive is properly introduced; it would provide a level of basic income for every adult person, whether employed, self-employed, unemployed, pensioner or student (from 18 upwards), and would replace sweep away a host of confusing different benefits and entitlements which are actually DESIGNED to be confusing so that many people find them difficult to obtain. Disability Benefits and Housing Benefits would remain unaltered but would be on top of UBI, as would company and private pensions. Everything else (earned income) would be subject to a higher rate of income tax, but since all would receive UBI, anyone who wished to work would be better off than those on UBI – an incentive for everybody. But the stigma of claiming benefits would disappear since the UBI would be received by everyone without the need to make application. It can work – it WILL work, but it is up to us to campaign for it!

    Rif (Ceredigion)

  • I’m not an accountant, economist or tax specialist, but I did some quick calcs (which are probably wrong) to provoke discussion:

    The NB-UBI scheme pays an unconditional £7k a year to working age adults. Pensioners still get state pension as now, but not NB-UBI. In parallel, the basic rate allowance is eliminated and the top rate threshold reduced to £44k per year. Basic tax rate increased to 30%, upper stays at 40%. All paid work has income tax of at least 30% deducted at source. NB-UBI entirely replaces tax credits and jobseekers allowance, which no longer need to be administered. Disability and housing benefit doesn’t change. I haven’t included NI because it’s too complicated.

    £7k per year to 40m working age adults costs £280bn.
    Savings from tax credits and jobseekers saves £30bn
    Half the admin cost of the DWP is abolished, saving £3bn
    28m tax payers earning over £12.5k pay an extra £3.75k tax per year from zero threshold – extra £105bn tax income.
    Estimated extra tax take from those earning under £12.5k – £5bn
    Extra tax income from reduction in upper rate threshold – £7bn
    Extra tax income from changing basic rate from 20% to 30% on middle earners – £66bn

    Net cost to Exchequer of NB-UBI is £64bn.

    However no one is worse off and low paid are always better off, and that £64bn will get spent into the economy. Contrary to what some people think, I believe NB-UBI will encourage people to work – anyone taking any work, no matter how casual, temporary or part-time always keeps 70% of what they earn with no form filling or benefit clawback. Having all earnings always taxed at 30% at source will reduce deliberate or accidental income tax fraud. So the true net impact is likely to be less than £64bn, but still needing a significant sum to be found from somewhere.

  • Pieter-Paul 9th May '20 - 10:48am

    fully agree that basic income is the way forward after covid19, it was also party policy under Paddy Ashdown and Charles Kennedy (not sure when it was abandoned). However the old arguments for and against already rehearsed above are not really relevant in the 21st century. How we earn a living has changed radically and continues to evolve rapidly. Universal credit has failed and cannot be fixed. A huge economic stimulus is going to be needed anyway and what better way than by ensuring a basic income reaches everyone rapidly.

  • Peter Davies 9th May '20 - 12:23pm

    @Thomas Child benefit was introduced as a universal benefit (now slightly modified with a cap) so replacing it with UBI would be little more than renaming it. The British equivalent of US social security is Job seekers’ allowance. Most proponents of UBI suggest a level at or above the level of JSA so if you paid for it with taxes on income, it would renot reduce the income of anyone currently on benefits. The poorest in our society, are generally those who for some reason fail the tests for all the different welfare schemes and don’t use up their tax allowances. They would be the main beneficiaries of a switch to UBI.

    It is possible for American libertarians to design a UBI system that increases poverty but it is clear that nobody in this party is proposing one.

  • Peter Davies 10th May '20 - 11:17am

    2005 was our best ever result.

  • I have not yet had time to read any of the sizeable contributions above, though of course scrolling quickly I see several names familiar to any LDV with half an interest in UBI, and that is encouraging.

    What I fear, however, is that many of them rehearse figures and arguments that share the approach of applying useful expertise about the present operation of Benefits and Taxes, to consider how to reform them to arrive at the potentially desirable goal. What I hope to see, when I read through, however, does not yet appear. And that is, a discussion that starts at the goal, the UBI, considers how best it might work, and only then applies the expertise to get there starting from here.

    And in particular I have been disappointed in the last months at the lack of response to the notion that the essential, the foundational or fundamental idea thought ought, I believe, to be our starting point ought to be as follows below. It begins, I suppose` with the old idea of Commonwealth.

    I am pretty ignorant of history (Maths , Further Maths, and Physics were my three A-levels in the mid 1950s). But, Cromwell or Crown, the ideas are pretty basic — and, habit and self-interest apart, it’s easy to see where justice lies between those two.

    [continued below]

  • [continuation from above]

    For brevity I jump to the proposal that the UBI which so many desire and discuss ought to take the basic shape of a Dividend of the National Income.

    The principal item in the Chancellor’s Budget Statement ought to be a prominent announcement on these lines:

    “The ONS inform me that the National Income for the year just ended was £ X. It was very unevenly distributed through the population, and HMG intends to rectify that unfairness by distributing it more evenly. That will be done by giving every adult a basic income, to be known as the National Income Dividend. The proportion of the NI to be distributed for the coming year will be £ y% of the Total NI last year, which works out as £z per adult for the coming year. Income Tax rates will be adjusted so that no-one is very much less well-off, and everyone whose income would otherwise be too far below the median personal income would be considerably better off. This National Income Dividend would partly be funded by the abolition of most means-tested Benefits. Adjustments in Income Tax rates will finance most of the balance, so there is no cause for misgivings about its ‘affordability’ (except perhaps from the very affluent).”

    This NID would have to be introduced progressively over several years, because the major shift in personal disposable incomes would greatly affect Demand, and consequently Jobs.

    What percentage rate the Chancellor chose for the NID would of course depend on the political and moral colour of the House of Commons. So PR would be a necessary change in its composition, and manifestos would compete to raise or lower it for year to year and Election to Election. The People would be choosing the colour and the odour of our Commonwealth.

  • jane pickard 10th May '20 - 4:00pm

    As my piece said, I’d leave others to run the numbers and it’s interesting 9 and informative) to see the debate around those that want to make this work whether at the level of destituition or at a less marginalised level of living. Thank you to those who have. I adot underestimate the difficulty in making it add up, I come back that it can’t all come via income tax:, corporate taxes and land must be included.
    My piece was pitched on our understanding now of our human nature, what Covid and our response as communities tells us about ourselves. Fundamentally the idea of trust in our fellow citizen is a precondition of a UBI being supported and rolled out. As liberals I expected the party to subscribe to that, perhaps now more of the electorate will be open to that idea as well.

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