Illustrations by Megan Le Brocq
There is a feeling of hope in the air, spring is on its way, days are getting longer and we are tentatively looking towards recovery from the coronavirus pandemic. We have a road map leading us out of this crisis; the end is in sight.
Recovery will not be easy: the 9.9% fall in GDP throughout 2020 was the biggest drop in the UK economy since 1709. Research reveals worsening physical health (as a result of increasingly sedentary lifestyles, a growth in snacking, and a reduction in exercise), alongside the negative impacts of increased unemployment and the nation’s mental health crisis.
It is doubtful that our elected representatives will come together to unite upon the best approach to alleviate the wide-reaching repercussions of the coronavirus pandemic. We cannot have a re-run of the austerity of the last decade; Johnson himself has pledged we will not return to that. Next week we will see what the government’s budget proposes, but it almost certainly won’t include the bold policy which could be a partial solution to our problems: Universal Basic Income (UBI).
UBI consists of a fixed sum of money given to every citizen of working age – no strings attached – monthly or annually.
The debate around UBI has been ongoing for centuries: the idea of state-provided minimum income is mentioned in Thomas More’s 1516 book ‘Utopia’. Forms of basic income, minimum income and guaranteed incomes have featured in a variety of policies over the last century, perhaps most surprisingly, in Republican US President Richard Nixon’s defeated ‘Family Assistance Program’.
Is 2021 finally the time for Universal Basic Income in Scotland and across the UK? Nicola Sturgeon says Yes, or at least she did in May 2020, supporting it as a temporary measure providing COVID-19 relief, adding that there will be “constructive talks” on the subject with the UK government.
UBI could prove to be a more effective way of encouraging spending in the UK economy than the “Eat Out to Help Out” UK policy last year, which benefitted those who can afford to dine out, rather than those struggling to afford food, and which may have been responsible for increasing COVID-19 infections by 8-17%.
Of course, there are criticisms of UBI. These largely focus on how we would fund such a wide-reaching economic assistance policy. Across the UK, it would take £67 billion to almost entirely eliminate poverty through a full UBI scheme. This is no insignificant sum, but it is also only 3.4% of GDP, and less than the UK government spent on corporate subsidies and tax breaks in 2015. There are also concerns about inflation. However, most UBI proposals focus on redistributing wealth rather than printing money, so it is unlikely to have a large effect on inflation levels. Conversely, it would promote economic growth, which helps to keep inflation low.
There is, therefore, an economic argument for UBI, as well as the added benefits of improved mental health, food security, reduced inequalities and reduced social exclusion. Even more encouragingly, 51% of the public support the idea, with less than a quarter of people opposing it.
Whilst we may be tired of hearing it, we truly are in unprecedented times which call for unprecedented policies. UBI has the potential to be our generation’s NHS, a radical idea which could become “crucial to British society”. Whether UBI is our answer to the problems we are sure to face over the next few years is hotly debated, but at least we are having the debate. It is time for us to consider bold new ideas for the new normal of the future.