Michael Izza 7 Apr 2017 10:00am

Universal basic income is an idea whose time may have come

Advocated first by Thomas Paine, briefly considered by Richard Nixon, the universal basic income may be the answer to some very current challenges

There has been an increasing amount of talk in the last few years about a universal basic income (UBI). The idea, also known as a citizen’s income, is that every individual receives an unconditional, automatic and non-withdrawable income as a right of citizenship, regardless of gender, wealth, employment status or age.

Not only is UBI seen as a potential route to helping the world’s poorest people out of poverty, but with the prospect of automation and robots replacing individuals in the workforce, influential tech leaders such as Bill Gates and Elon Musk are putting their weight behind it as a way of compensating redundant workers. It could also allow people to work flexibly in future so that they could pursue a career alongside some other non-income-generating interests.

Alternatively, they might choose to spend their lives pursuing that interest alone, safe in the knowledge that they have an income to fall back on. This alone could act as a boost to the arts.

The idea of a universal basic income is not new. Thomas Paine, English political activist and one of the founding fathers of the US, is credited with coming up with the concept in the 18th century. Since then there have been a number of experiments exploring the proposition, including a rather successful one set up to mitigate rural poverty in 1795 in Speenhamland, Berkshire, after the failure of several harvests caused widespread hardship.

The scheme was closed down in 1834 on the basis of what was subsequently found to be a bogus report from a Royal Commission (much of it written ahead of taking evidence) that accused it of encouraging laziness in the working class and causing a population explosion.

Somewhat surprisingly, some 150 years later, UBI almost became a reality in the US. It is surprising because its advocate at the time was the then US president Richard Nixon. In his recent publication, Utopia for Realists: And how we can get there, Dutch historian Rutger Bregman relates how in 1969 Nixon was about to sign into existence legislation introducing a basic income of $1,600 a year (equivalent to around £8,000 at 2016 prices) for all poor families. In doing so, he hoped not only to raise millions of workers out of poverty, but to leave his stamp on history.

On the day he intended to announce his move publicly, however, one of his advisers passed him a briefing based on the spurious Speenhamland report. The adviser had concluded from the report that the scheme had encouraged idleness among the poor, dulled their productivity, reduced their wages and practically undermined the very tenets of capitalism. Nixon was shocked and the legislation was quietly dropped. Now, of course, history remembers him for Watergate and his impeachment, without giving him credit for what would have been, in his words, “the most significant piece of social legislation in our nation’s history”.

Guy Standing, professorial research associate at the School of Oriental and African Studies, who has kept the UBI torch alight for more than 30 years, argues that “there is a claim right, or a republican right, to equal basic security, and social and economic policies should be oriented to the steady realisation of basic economic security for everybody”. Without such basic security, he adds, one can’t have full freedom.

At times he must have felt like a lone voice in the wilderness, but the increasing inequality around the world and the failure of governments to reduce economic insecurity have encouraged a surge of interest in UBI and a more favourable view of it outside academic circles. At this year’s World Economic Forum at Davos, there were no less than three panel sessions on the issue. And a number of countries – including Finland, Namibia and India – have been running localised pilot schemes, some with Standing’s help. Elsewhere local regions, including Ontario, California, Aquitaine and Catalonia, are planning to try different versions. Closer to home, two Scottish councils, Fife and Glasgow, are intending to trial schemes later this year, subject to enough funding being available.

As Malcolm Torry, author of the ICAEW publication How Might We Implement a Citizen’s Income?, observes, the question is no longer whether a citizen’s income is desirable: “The debate is now clearly shifting towards feasibility and implementability,” he says.

UBI is an idea whose time may have come.