Labour cannot afford to be outflanked on universal basic income

Neal Lawson

The Financial Times published a letter last week, signed by 110 MPs and peers, calling for a ‘recovery basic income’. A spokesperson for Keir Starmer was then asked about Labour’s attitude towards the idea. The reply, in effect, was: not now but perhaps later. Many in the basic income camp, which has grown astonishingly quickly in the past few months, were disappointed – and some were angry. They shouldn’t be. This week marked a turning point for those that want to put an income floor under everyone in Britain, but the party cannot afford to kick the issue too far into the long grass.

The game is changing for Labour on basic income for two reasons. The first is the economics of the crisis. Almost everyone is now a precarious worker, and it is little wonder that an Opinium poll at the end of March showed an incredible 84% favourability for basic income. The machines and the algorithms may or may not be coming – but right here, right now, jobs are being lost at an alarming rate.

With all the uncertainty of further spikes in Covid-19, other viruses, the near-certain impending financial, economic and housing crashes and the climate crisis, people crave income security. The emergency job retention measures are fine for a short while, but still leave huge holes. What comes next? A recovery basic income – as set out in a report by economist Stewart Lansley and published by Compass – outlines clearly why and how such a scheme could and should work. For the first time ever, everyone would have a solid income floor beneath their feet.

The challenge facing Labour is not just economic, however – it is now political. The big shift last week was not just the numbers of the new Labour backers for basic income, but the fact that the SNP are now firmly behind the idea as well as – more tellingly – the two frontrunners for the leadership of the Lib Dems, Ed Davey and Layla Moran. And of course, the Greens have long been there.

And this is not just about other political parties. There is a burgeoning basic income movement across the country. ‘UBI Labs‘ have been initiated in seven cities including Leeds, Sheffield and Liverpool. And the Basic Income Conversation, which was behind last week’s recovery letter, is helping to orchestrate a powerful national debate.

Can Labour afford politically to be outflanked and left behind? No. The party won’t yet make policy for 2024, but it must be part of this radical debate for change. Even if it does not lead, it must engage and give air to the radical and progressive instincts behind basic income.

Of course, the policy has to be right. Some in Labour still worry about the impact on work. Work is central to our identity and sense of meaning as human beings. But the kind of basic income that is being looked at is exactly what it says on the tin: a basic income floor, not a wage replacement.

And it is pitched at a level that would mean some other benefits such as housing and disability would be continued – they would have to be. But it makes more secure workers stronger in the labour market, enabling them to hold out for higher wages and better jobs. And for everyone, without exception, it marks a strong return to universalism and a new form of social security fit for the 21st century – an era defined by crises.

The go-to reference point for the crisis is, of course, the Second World War and the new social settlement that arose from the conflict. Some of the comparisons are valid. Back then, Aneurin Bevan used the war, the new role of the state and a rediscovered sense of social solidarity to construct a new universal health provision. A floor that gave every citizen strength and security.

Today, that ambition and determination proves the worth of Labour more than anything else that the party has ever done. Our challenge now is to be equally bold, and to establish for the economy and our society what Bevan established for public health: an income floor under which nobody falls. No gaps, no holes, no humiliating means testing – a universal level of security for all.

In a post-Covid-19 era, Labour has everything to gain from being part of the biggest transformative idea on the political agenda – a basic income floor for all. You can co-sign the demand from Labour MPs and peers, and others, that the Chancellor establishes a recovery basic income here.

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