The idea of a Universal Basic Income is that the state pays something to everyone, regardless of circumstances. It needs to go with a changed tax system, so that the money is taken back again in tax from most people.
It means that, if people fall on hard times, they stop paying the money back in tax, rather than needing to claim benefits. This matters because there are inevitably flaws in the design of any system of benefits. People can fall through the gaps, whether those are oversights or bureaucratic errors, and face destitution. The five week delay before receiving Universal Credit is a good example. There was credible reasoning behind it, but the number of people needing help from food banks in that period shows that that reasoning was flawed. Not being sure where your food will come from or how to keep a roof over your head does real and long term harm to someone. With a Universal Basic Income, bureaucratic mistakes mean that the tax authorities get their money a little later — which does a lot less harm.
Continue reading “Universal Basic Income: a sensible economic response to Covid-19”