Universal Basic Income

Angela Crawley Excerpts

Wednesday 15th June 2022 Westminster Hall

[Angela Crawley (Lanark and Hamilton East) (SNP)]

I beg to move,

That this House has considered the potential merits of a universal basic income.

It is a pleasure to serve under your chairmanship, Ms McVey. I thank my hon. Friend the Member for Inverclyde (Ronnie Cowan) for his contributions in this place on the issue of a universal basic income. There is no better time to reopen the discussion on this subject. We are up to our necks in the cost of living crisis, which is pushing households across this country further into poverty and destitution. We need change, and we need it now.

Over more than a decade, the Conservative Government have carefully crafted a welfare system that designates recipients as being deserving of payments only if they meet conditions. I appreciate that the idea of implementing a universal basic income and removing the conditions on welfare payments would not normally sit comfortably with the Government. However, it seems that the Conservative party has had a change of heart. On Monday 6 June at the Treasury Committee, when the Chancellor of the Exchequer was questioned on the universal nature of energy bill discounts, which will leave third home owners £1,200 better off, he said:

“there will be some people who do not need the help. That is, unfortunately, the consequence of having to do policy in practical terms.”

He said that, having looked at all the options, the Government decided that the discount was “the most effective way” of reaching a “large number of people” and helping them when they needed it. Clearly, this Government have had a change of heart, and are open to universal policies, depending on who benefits, so it seems that the biggest barrier to implementing a universal basic income is ideological. I urge the Minister to consider extending his party’s new, compassionate approach to the benefits system, and to abandon the cruel and unforgiving system that depicts desperate people as undeserving.

I come to the benefits of a universal basic income. As we have heard many times here and in the main Chamber, a universal basic income would mean that every citizen was provided with a subsistence income. It would mean secure, regular payments into every individual’s bank account, without threat of disruption. In real terms, it would ensure that every person in this country was always able to afford food, keep a roof over their head, provide for their children and have a minimum standard of living.

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

In principle, the concept of a universal basic income is promising, but just so that I understand, will the hon. Lady answer these questions? Under her definition, would the universal basic income be the only income that a person received? Would they receive additional benefits if they were unemployed or had disabilities? At what amount would she consider setting a universal basic income?

[Angela Crawley]

I thank the hon. Member for addressing those points. To be clear, we already have a system that recognises that individuals will need an approach that is tailored to their needs. Those who have disabilities will need additional support. Those who need additional support because of family requirements will have it. We have a system that already accepts that.

This is about acknowledging that every single person has the right not to be destitute. That is a basic, fundamental tenet. I find it uncomfortable that anyone in this place would consider it a radical motivation. A recent study by the University of York found that a universal basic income would cut poverty by more than half, bringing it to the lowest level for 60 years. It would cut child poverty and pensioner poverty by more than half and working age poverty by a quarter. It would be a driver of economic equality. Further research has shown that it would stimulate local economic growth. Introducing a universal basic income would allow us to incentivise people into work properly, and to move away from the current focus on cruelly sanctioning those who are desperate. Instead of our pushing people into precarious forms of employment and pretending that work programmes are actually working, a universal basic income would provide financial security. It would enable everyone to pursue employment that was more suitable for their lifestyle, hopes and ambitions, and it would allow everyone to engage in socially and personally productive activities, such as community or voluntary work, care giving, or entrepreneurial or creative activities.

The Scottish Government explored the feasibility of introducing a universal basic income, but found that it was impossible under the devolved settlement. With independence, the Scottish Government could be ambitious and look to a future where we could ensure that every citizen in Scotland had the support they needed. We do not have those powers yet and, without independence, we will not have them.

Instead, the Scottish Government commissioned research on a minimum income guarantee, which would transform Scotland’s fight against poverty. Rather than leaving those in need at the mercy of universal credit sanctions, it would at least guarantee that they did not drop below the poverty line. One of the Government’s core contentions, when this matter was last brought to the House, was the expense of setting up such a system. However, the UK Government already have the technology to implement a minimum income guarantee. We already have the tapers in place for the universal credit system, which has markers to ensure that those who need additional funds will get them; that answers the hon. Member for Central Suffolk and North Ipswich (Dr Poulter).

Universal credit was supposed to streamline and simplify the welfare system. Instead, it has led to the Government ploughing excessive funds and resources into empty work programmes, processing sanctions, and a target-driven jobcentre workforce unable to help those most at risk of poverty. If the Government wish to cut 90,000 civil service staff, and expect to keep this very complex welfare system running, it has another thing coming.

I ask the Minister to read through the numerous studies that have shown the benefits of introducing a universal basic income; to keep a close eye on the Scottish Government’s work on the minimum income guarantee; and to explain how the flawed and damaging universal credit system is in any way an adequate system by comparison.

The country is in crisis. As the cost of living crisis continues, we cannot ignore the worsening mental health crisis. The two are most definitely linked, and introducing a universal basic income would help to alleviate both. Innumerable studies show the detrimental impact of welfare conditionality and its impact on the mental health of welfare recipients. I do not think anyone here is in a position to argue with that. A universal basic income pilot scheme, conducted in Germany and Finland, showed that reform of the welfare state directly impacts the mental health of welfare recipients and their overall mental and physical wellbeing.

The Mental Health Foundation found that children who receive payments were less likely to use drugs and alcohol, more likely to stay in education, and more likely to have improved physical and mental health outcomes. The Finnish system showed that universal basic income helps improve cognitive functioning in adults, reduces feelings of anxiety and depression, and generally increases overall life satisfaction.

A universal basic income is a holistic policy that will have holistic effects across a whole area of social policy. Studies have shown that a universal basic income, although expensive in the beginning, pays for itself over time, through its far-reaching impacts.

[Gareth Davies (Grantham and Stamford) (Con)]

I congratulate the hon. Lady on securing the debate and giving a considered and well thought-out speech. Will she clarify that point on expense? The cost of this programme, even if it were rolled out using a modest income, would be around £316 billion annually, according to one study. Can she clarify what her research has shown about the overall annual cost?

[Angela Crawley]

As the hon. Gentleman will appreciate, there are no studies that can show comprehensively the long-term benefits of such a scheme, because there has been no extensively researched pilot here or in most countries. I think we can all agree that when an individual does not have to think about how they will fund their next meal, pay for the electricity or subsist and survive, they can start to think about their life chances and opportunities, and can begin to fulfil their ambitions in life. There is so much to be gained from a pilot, which would give the hon. Gentleman the evidence, studies and statistics that he asks for.

A universal and destigmatising, more compassionate welfare system would decrease depression and anxiety rates. It is not over-dramatic to say that it would save lives. If the Government are committed to addressing the mental health crisis, will they reform the system responsible for pushing so many people to the edge? I end my contribution by calling on the Government to consider seriously the prospect of a universal basic income. I do not believe such a policy is as radical or unattainable as it seems. We already have the technology and a substantial Department for Work and Pensions budget that could cater for most of these measures. It is wasted, however, on empty work programmes and on processing sanctions, which scar people mentally and financially and abandon those most at risk to life in poverty.

Universal basic income represents a fairer system. I encourage the Minister and his Department to consider establishing a pilot scheme, and to speak to the results rather than to the rhetoric. The biggest issue is cutting through the damaging Tory ideology that people have to work for their basic human rights. I urge the Minister to rethink his Government’s approach, and to seriously consider a universal basic income pilot scheme.

[Several hon. Members rose—]

--- Later in debate ---

[Gareth Davies]

The hon. Member makes a reasonable point about evidence, but I will point out to him that there is also no evidence of universal basic income working anywhere in the world. The hon. Member for Lanark and Hamilton East—

[Angela Crawley]

rose—

[Gareth Davies]

I can pre-empt it. The hon. Lady rattled off a number of examples—I will hurry up with my speech because I am being asked to move on, although I have taken a number of interventions, which will hopefully be acknowledged.

There have been a number of studies and pilots, not least the one in Wales that is going on at the moment, but not one has been executed. There is not one example from around the world that we can point to where universal basic income has been implemented. The reason is that, although such pilots may show some benefits for mental health, wellbeing and other points, not one of them has not shown any Government around the world that universal basic income is the right model for alleviating poverty in the future. [Interruption.] I am afraid that I will end my speech here, by saying thanks to you, Ms McVey, and thanks to everybody for listening. I feel a little alone on this side of the Chamber, but I am pretty sure that the British people are with me.

--- Later in debate ---

[Alison McGovern]

I will go on to say why universal basic income is not the Labour party’s policy.

Basic facts are important. The hon. Member for Lanark and Hamilton East could tell us more about the situation in Scotland. She mentioned the experience of the Scottish Government, and I think she could make her argument by giving some more basic facts. It is difficult to see exactly what she wants the change in system to do when we do not know exactly what is being proposed.

The hon. Lady mentioned supporting the idea of a minimum income guarantee, as did several Members. That, however, is not the same as a universal basic income. A minimum income guarantee is about a standard below which no one should fall, whereas a universal basic income—as I understand it from her—is about a universal payment for everyone, regardless of circumstances.

We need to think about this from first principles. Our social security system has two purposes: first, to smooth incomes over a person’s lifetime. We therefore have universal aspects to our system that we all agree with, such as the idea of the state pension being universal on the basis of age. Other aspects of our social security system, such as child benefit, are paid on the basis that children have limited possibilities to generate income. In fact, we absolutely think that children ought to be supported, though we could have a long debate about the two-child policy and the fact that it rather contravenes the principle. That smoothing of income over a lifetime is exactly as Beveridge envisaged the system would work.

Secondly, our social security system addresses the needs that people have in order to enable their full participation in society—so, those who have extra costs, the obvious example of which is people who have a disability .

[Angela Crawley]

The hon. Member has made it very clear that the Labour party does not support universal basic income, which I find profoundly fascinating. However, that is not the point that I want to make. She also said quite clearly that she felt the benefit system had started to change since 2010. What lessons have been learned by the Labour party, which itself had a system that was far less than perfect, and what exactly is she proposing to ensure that those living on the lowest incomes can at least have the basic subsistence that is required?

[Alison McGovern]

I will come to that point, because I will set out shortly, if I may, what I think is the important way in which we should take our country forward.

--- Later in debate ---

[Angela Crawley]

I thank hon. Members for contributing to the debate. On the question of where the detail and the facts are, I direct the hon. Member for Wirral South (Alison McGovern) to the fact that the Scottish Government fully costed, in two feasibility studies, a model that is workable, but the simple fact is that this winter will be the hardest yet for too many families and too many children will continue to grow up in poverty. I do not think UBI is a radical concept. With the greatest respect, if the Queen’s Speech is anything to go by, I think this Government need some radical ideas and a new vision. I urge the Minister to seriously consider a pilot of this scheme and to give families a chance.