By Lisa Muggeridge
Universal Basic Income is the panacea on everyone’s lips.
A system only works as long as the context in which it was devised doesn’t change – and the British welfare system has had to deal with huge changes in context.
Built around a nuclear family model – male breadwinner, female unpaid carer – our welfare system has had to adapt to the most significant reorganisation of family relations in history: gender equality, the care economy, disability rights, the housing boom created by a debt-based economy, an ageing population.
The panicked responses of governments to these changes have resulted in some of the most vicious welfare reforms in history. These are generating crises including the undeliverable Universal Credit. Nobody really knows what to do right now. So the Left are using Universal Basic Income (UBI) as a euphemism for their lack of understanding of welfare, the labour market, and the economy.
Here are some questions to ask the mostly white, male, elite-educated, politically connected left-wingers trying to sell you UBI:
- Housing Benefit
This ties benefits to rents in your local area, not nationally. It is tied to the local housing market and responds to it. And even though the housing market has malfunctioned and benefits have been slashed, the Housing Benefit system is still more or less holding together after 70 years, precisely because it can respond to the local housing market and is calculated according to changing local rents. How will a nationally set UBI do this? Or will another benefit system be required for housing costs? The Housing Benefit system acts as an early warning of an overheating housing market; how will UBI replicate this?
- Motherhood pay
The motherhood pay penalty is linked to the labour market and changes constantly. Our benefits system responds to this by calculating tax credits according to wages, sometimes with Housing Benefit on top. This is directly linked to a changing economy. How will your UBI model do this?
The UK has no state-provided childcare, and our childcare is the most expensive in Europe. Rates can vary according to the town and provider, from a few pounds a day for after school clubs, to £700-£800 a month per child for private day nurseries. When the Tories cut childcare allowances to 70 percent of childcare costs, it pushed thousands of women out of work. How will UBI respond to childcare that is provided by a variable market?
The costs of disability are not related to employment; they are about how much additional money you need to be mobile and to buy things that allow you to participate in the world. How will UBI respond to this? Will there be an additional benefit system?
While mainstream welfare literature has focused on “labour market activation” – getting people into work – our benefits system provides information about the extent of inequality which corresponds to race, gender and disability faultlines. To get out of the current crises we will need to use this information. How will UBI record this data if it is paid equally to everyone?
We are supposed to use unemployment data to measure unemployment. The willingness of people to sign on once a fortnight allowed the most accurate measure of unemployment available. This tool has been destroyed by conditionality, but it needs to be restored. How will UBI measure unemployment?
- Gender and care roles
Caring functions used to be confined to the private family unit, but these days women are independent economic actors so a care economy has emerged to fill that gap. In a country with falling birth rates and an aged and rapidly ageing population, how do you propose this work will be done? How does a care economy that is guaranteed to expand constitute a “post-work world”? Is the caring economy not part of the post work world, or will gender equality just be rolled back with women expected to perform these tasks unpaid?
- Care workers
Care work is usually performed by low-paid women who have to outsource their own care responsibilities to do this. See question about childcare.
When you have your two-tier benefits system with UBI costing a fortune and the rest of us still needing top-ups for housing and care, how do you propose to solve the issue of inequality and unequal political voices? The left wing media is representative of the middle classes who will receive UBI and have the political clout to fight for UBI at the expense of those on the bottom layer of the two-tier benefits system. Who will lose? The people who already have no political voice, because of a left wing media culture rooted in elite universities. How do you ensure your two-tier benefits system does not end with those on the bottom tier being abused the way the “undeserving” claimants of Beveridge’s system were abused?
How do you propose to pay for UBI when we need to keep the above top-ups? What services will have to be dissolved to pay for it? Will it be the structurally invisible services of care, child protection and benefits addressing inequality, which bore the brunt of austerity?
- Payment levels
How will you be deciding the level that UBI is set at? What measure are you using to decide how much is enough to live on? Do you know anyone who can live on the £100 a week or £74 a week suggested so far? Because even people on the lowest single person’s rate of JSA need housing benefit to live independently. How are you finding a figure that releases 64 million people from the need to work when the median wage is £27k a year? Who will live on this £100 a week, is it just the poorest? Could you live on £100 a week?
- Financial instability
We currently have issues with financial instability, and our benefits system will prove to be a key institution that stabilises our economy. It fulfils this function because it moves naturally to compensate for the fluctuations of the market economy; the ceiling of any cash transfer welfare system automatically reflects the lowest living wage, as seen by the Housing Benefit bill (see question one). How will UBI perform this function?
- Employer subsidy
Tax credits are the only measurable subsidy received by employers who pay no tax. Measurement of this is going to be quite important if we cant tax capiatl because revenue raising. How will UBI do this?
- State control
How would you prevent the level of state control that UBI would entail being used to abuse people? It took 70 years for social security to mutate into workfare schemes and abuse those supposedly protected by equality legislation. You are saying that 64 million people should be handed over to state control. How would you prevent state abuse of power when the entire population’s personal finances are reliant on the state?
- Self employment
We have more and more self employed people, many of them with children. They currently can claim tax credits, the amount of which changes in response to fluctuating earnings. How does a fixed rate UBI address this?
- And finally…
If you need to keep or create additional benefits to meet the above needs – childcare, disability, housing, self employment etc – what specific problem in the UK benefits system does UBI actually solve?
If someone is promoting UBI, they are telling you they don’t understand welfare, they don’t know any poor people, and they will never have to survive on it. It is a regressive transfer of money from the poorest to the middle classes, from women to men, from those suffering race inequality to white people, from those with disabilities to the able-bodied.
Our current benefits system held out for 70 years before the context changed significantly enough around it that we need to replace it. How long will UBI last and how will it respond to changing economic and social circumstances that cannot be predicted? How long before a right wing think tank uses these ideas to liquidate our welfare state for good?
It doesn’t cost money to stop using our benefits system to abuse people; in fact, it saves money. It doesn’t cost money to simplify our benefits system; again, it saves money. Only by assessing how the social and economic context changed during the lifetime of our benefits system can you assess what is wrong with it and how to fix it. UBI is a way to avoid doing that. It is dangerous nonsense that would be paid for by generations of people unconnected to the Left for the next 70 years.
By the second question on the list above, the answer will be that we will have two benefits systems. All that went wrong with our current system was that it was built around unemployed men and then turned out not to be about unemployment at all. For 70 years those on the bottom tier were abused as “undeserving”.
Supporters of UBI, in effect, want to see this abuse recreated.