Interest in a universal basic income has dramatically risen in response to plans for two micro-pilots in Jarrow, South Tyneside, and East Finchley, London, published in a report by the think tank Autonomy and Northumbria University. We have been asked two recurring questions. First, why is a progressive basic income needed now? And, second, why should the Labour Party recommit to trialling it given their current strategy of avoiding perceptions of radical policy?
Answering the first question is straightforward. The effects of Covid-19 and the cost-of-living crisis on Britons who are employed, self-employed or run small businesses have been exacerbated by inadequate government responses, leaving a very large proportion of hardworking people at serious risk of destitution. Financial insecurity has skyrocketed to levels unseen in generations. Analysis from the Child Poverty Action Group shows that millions of in- and out-of-work Britons are now enduring fuel poverty, while the End Fuel Poverty Coalition found that 1,047 people died in England from living in cold damp homes in December 2022. The Bank of England’s ongoing commitment to a gradual and sustained increase in interest rates has exacerbated the rate of repossessions without addressing inflation caused by factors largely beyond consumers’ control.
This is contributing both to immediate public health crises and a ticking timebomb of conditions that will emerge – devastatingly so given a lack of available reactive treatments – over the coming years and decades. The people affected, numbering in the tens of millions, are falling victim to social determinants of health, such as poverty, inequality and insecurity, that they cannot possibly address as individuals. As even the current government recognises, prevention is better than cure. This can only be achieved through UK government action, with support at all levels. Our recent report sets out how basic income is a radical yet feasible alternative to the existing, failing system, which could reduce poverty to unprecedented levels, address inequality within and between regions and massively improve the nation’s health.
Universality of basic income may make it less vulnerable to cuts
The idea of the state redistributing resources by providing an adequate, regular and predictable cash transfer to citizens is radical. It turns welfare discourse on its head: from a payment to a select few to one that closes the fairness deficit and provides a safety net for the majority of working citizens who are currently unprotected. It is – as one voter from our study who initially opposed the concept suggested – a ‘living pension’. Basic income’s universality is crucial, since the key reason that needs- and means-based benefits are so vulnerable to cuts is that, in the eyes of those most likely to vote, they only affect others. There is good electoral reason that pensions have increased at a time that most other forms of welfare have been frozen or reformed.
The impact would most keenly be felt in left-behind areas of the country, such as in the North, Midlands and Wales, that were highlighted in the government’s levelling up report as facing financial insecurity, health inequalities, infrastructural decline and broader social decay. One of the key reasons the Conservatives won the 2019 general election is because voters in ‘Red Wall’ constituencies were presented with promises of redistribution and investment that they had not previously experienced even under New Labour.
Basic income could help address voters’ cynicism about politics
Where Labour has done well electorally in recent years, particularly in Wales and Greater Manchester, it has been due to the adoption of policies – such as nationalisation of transport and improved access to housing and employment rights – that protect working people from financial insecurity. Welsh First Minister Mark Drakeford has already taken the bold step of commissioning a basic income pilot for care leavers.
Given the absence of similar UK-level commitments, voters are returning to a position of cynicism about government’s ability to make a positive, transformative impact on their lives. Basic income can change this. When effectively explained, it is overwhelmingly popular. And our ongoing research suggests that the public support its funding through wealth taxes and corporation tax. This offers a clear pathway to avoid attacks that relate to punishing workers.
Reception of our pilot proposals demonstrates that there has been a significant shift in what the public perceives as possible since the pandemic. Support has come from those who progressive politicians assume would be opposed, particularly from within business. The comments sections of even more conventionally right-leaning publications have been at the very least balanced and sometimes largely supportive, especially when it is made clear that workers would receive it. Left, right and centre all have something to gain from basic income.
Failing to back basic income would be a political error by Labour
Basic income can support workers by granting greater bargaining power, but it also strengthens businesses, particularly in left behind regions, that need a healthy, productive workforce who no longer faces the disincentives to work driven by the existing, conditional welfare system.
Labour is only relevant when it demonstrates that it can secure the living conditions of the vast bulk of the population. At the very least, the party has an interest in getting behind pilots and trials of basic income and making its commitment to voters’ interests plain. If there is a lesson to be learned from the last few years in politics, it is this: if progressive parties fail to provide a clear message that voters believe will have a material benefit to their lives, the Conservatives will. Basic income is our generation’s NHS, and Labour need to get on board.