Universal Basic Income

Debate between Chris Stephens and Ronnie Cowan

Tuesday 13th October 2020 Westminster Hall

[Ronnie Cowan (Inverclyde) (SNP)]

I beg to move,

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

I thank the Backbench Business Committee for granting me this opportunity. I regret that this sitting is not fully hybrid and that MPs who are isolating or shielding to protect their health and that of others are in effect barred from taking part. That only increases the pressure on Members to travel when they could work from home and forces those who support us to attend the parliamentary estate, too. It was my first time back on the estate for a wee while and I was delighted to see new signs everywhere saying, “Keep left and keep moving”. I am hoping that that is a new sign from the UK Government.

While writing this speech, I noticed that as soon as I typed in the letters “u” and “n”, my iPad prompted me to select “universal”; when I accepted that, it prompted “basic income”. It appears that my iPad has been paying more attention to me than the UK Government have. It also learns quicker.

Universal basic income is an inclusive scheme that protects and recognises everyone. All adults and children receive a set payment on a regular basis. It is fair. It destigmatises the recipient. People are paid regardless of their circumstances. After all, are all people not created equal?

UBI alleviates poverty and reduces inequality. It strengthens a sense of individual citizenship. It empowers people and facilitates civic partnerships. To quote the UBI Lab Northern Ireland working paper,

“A UBI can be understood to be a right of citizenship—a fair share of the assets we and the generations before us have helped create. It recognises each of our stake, or share, in ‘the commons’ of the earth.”

I find that a truly beautiful concept.

A UBI strengthens social bonds and improves mental health. Nobody would deny that economic instability contributes to poor mental health, yet the current system dangles the threat of sanctions over the heads of recipients, going so far as to drive some to suicide. UBI removes that psychological burden. A UBI will not fund the lifestyle of an MP, but it is a platform on which individuals can add other income without fear of financial repercussions.

The current system ties work to welfare. It can make the transition into work more complex. People should be free to take on part-time or occasional work without strings attached. A UBI affords more flexibility to employee and employer, while acknowledging that employees are empowered and less likely to be exploited. It is permanent. It gives security and peace of mind. It cannot be withdrawn or become conditional, unlike the pensions of hundreds of thousands of WASPI women—Women Against State Pension Inequality—who were cheated out of their pensions by the UK Government. That permanency stimulates entrepreneurship, which can lead to the generation of jobs. It is the poorest in society who will directly benefit most; as we know, they are more likely to spend their money on essential items in their own community, which in turn stimulates local growth.

Prior to covid, the upsurge in interest in UBI was attributed to the gig economy, the increase in automation and the creation of a greater number of people described by Guy Standing as “the precariat”. Covid has accelerated the increase in the numbers of the precariat. Many people who once felt safe now feel vulnerable.

It is the duty of any good Government to protect their citizens—not just in the short term, not just by reacting to unfolding circumstances, but by planning for the long term, for future generations. To that end, pilot projects have already been run in Canada, the USA, Kenya, Brazil, Finland, India, Italy, Uganda and Namibia. Versions of cash transfer projects have been run in Iran, Lebanon, Kuwait, Zambia and Zimbabwe. There are plans for UBI-type schemes in Spain, Switzerland, Germany and Ukraine. I have a simple ask of the Minister: have the UK Government taken any steps to learn anything from any of those countries? And please do not quote the Finnish Finance Minister, who came out against UBI before the results of the Finnish trial were even published.

If the UK Government think it is beneath them to be advised by foreigners, will they back pilot projects in the UK and learn from them? Northern Ireland is asking, Wales is asking, Scotland is asking and England is asking. If ever there was a policy that could be pursued and that would be welcomed across the United Kingdom, UBI is it.

The four pilots proposed in Scotland are all well documented—all we need is the co-operation of the Department for Work and Pensions and Her Majesty’s Revenue and Customs. Those pilots will help us not only to learn about the economics of UBI but to understand the political, strategic, institutional, psychological and ethical feasibility of a UBI.

When we exposed the UK to universal credit, it was plain to see that it had not been thought through fully, and it failed miserably. Ever since then, we have been patching and amending the system. If we had run pilots for universal credit, we would have avoided many of the pitfalls and saved many people from the suffering that it caused.

I claim that UBI reduces crime, gives people more opportunity, improves health and mental wellbeing, improves community relations and contributes to a stronger local economy. Minister, run these pilots across the UK and prove me wrong. I know that the Minister is not a fan of UBI: he will claim that the cost makes it a non-starter. Why even consider it, if we cannot afford it? Why run pilots that might tell us that it is amazing, even magnificent, if we cannot then implement UBI? Well, Minister, let us run the pilots, learn what benefits UBI brings or does not bring, and then we can argue about cost versus outcome. If the Minister is seriously telling me that even if all the benefits of UBI that I am claiming can be proved, he would not move mountains to provide them for the citizens of the United Kingdom, then he is skating on very thin ice.

The NHS did not just materialise out of thin air; it was not dreamt up one wet Wednesday afternoon in the Tea Room or designed on the back of a fag packet. The NHS was introduced on 5 July 1948, but prior to that half of Scotland’s land mass had already been covered by the Highlands and Islands Medical Service, which had been set up in 1913. HIMS acted as a working blueprint for the NHS in Scotland. It was directly funded by the state and it had Ministers centrally in a Scottish Office in Edinburgh. It was a pilot project allowed to develop and grow; it uncovered unforeseen problems and fixed them. It ensured that, on day one of the NHS, the NHS was to all intents and purposes good to go.

There is an interesting aside about HIMS. One of its administrators was from my constituency, a Gourock-born woman called Muriel Ritson. She was the only woman on the Scottish Board of Health in 1919, but by 1942 she was sitting on the Beveridge commission, which helped to establish the NHS. The link is there for us all to see. She had learned her lessons, and she brought that learning to bear many years later. She also attended the school that the hon. Member for North East Fife (Wendy Chamberlain) and I both attended.

Mary Breckenridge, an American, visited Scotland in 1924 and later established the Frontier Nursing Service in Kentucky, based on the HIMS model. But not everyone saw the benefits of HIMS—just like today with UBI, the Conservatives argued against it. Lord Banbury objected to English taxpayers contributing money that would be of medical benefits to Scotland. Here we are, all these years later, with NHS Scotland and the wider UK NHS acting in true UBI-style and supporting us all through the current health crisis. If we had not had the NHS, it would have been too late for us to create it. It was there for us and UBI could have been there for us, too.

If the Minister is not prepared to follow current examples from around the world, then he should be brave—support the pilot projects and lead the world. Yes, it will cost more; it will cost lots of pounds and lots of pence. However, their value will be far higher than that of our current system, and the society that the spending will support is too precious not to exist. Although I do not doubt for one minute that budgets must be balanced, recent times have taught us that when the motivation exists, the purse strings can be loosened.

I will now review quickly the response of the Minister to UBI in a recent Petitions Committee sitting. He had three objections. First, how do we afford it? The Minister explained that the Centre for Social Justice found that giving every working-age adult in the United Kingdom £10,000 per year would cost in the region of £400 billion. He seems to think it is higher, but I question that figure. His argument was that the average universal credit claim was more generous at £16,000 per year, completely ignoring the fact that the UC figure is per household. A household with two parents and two kids do not need £5K per adult and £3K per kid to meet his generous standards. I have just halved his £400 billion in one stroke.

His next question was: how do we deliver it? The simpler the system, the cheaper the delivery—and UBI is simpler. Even if it costs the same as the existing system, we are still no worse off. He went on to boast:

“My Department and HMRC have done exceptional work throughout the pandemic to stand up new services and increase the capacity of existing ones. We have been able to move quickly to support over 9 million people”.

I offer genuine congratulations. That is a job well done. I know my local DWP and the one jobcentre left in my constituency have been superb, but with UBI there would be no need for that. All payments would already be in place. With UBI, the safety net has already been built. We are not building it as we are falling.

[Chris Stephens (Glasgow South West) (SNP)]

Is my hon. Friend as concerned as I am that at the height of lockdown, although the herculean efforts of the DWP staff ensured that people got paid, many people were getting about £60 a month taken off them owing to advance repayments?

[Ronnie Cowan]

That goes back to my original point: that I do not believe universal credit is the solution we are looking for. It has been patched and amended, but when it is put under pressure and there are changes in circumstances, the system is not fleet of foot and able to cope with people’s day-to-day living.

During the Petitions Committee sitting, the Minister turned to the issue of the impact of UBI. He had the temerity to say:

“this is the fundamental case against UBI.”

It was not the cost or the delivery, but the impact of UBI that he did not like. He stated:

“Unlike our UC system, UBI does not target support at those in greater need”.

Finally, he got it right. We do not need to target it—everybody gets it, with no stigma attached. He went on to say that UBI does not

“take into account additional costs faced by many individuals, such as those with a disability or those with childcare responsibilities.”

If he reads the pilot project’s proposals, he will see that they do take those into account.

Then, in sheer desperation, the Minister went for an old chestnut. To put it into perspective, Chair, UBI would be paid to you, me and all Members of this House. Yes it would—and it would be taken back in tax, thank you very much. In attempting to vindicate the current system, the Minister, without a hint of irony, said in his conclusions that the UK Government were

“providing millions to food charities to help get through to those who are struggling”.

Yet if people had UBI, they would not rely on charity from this one nation conservatism-driven Government. People do not want handouts—they do not want charity or the crumbs from the top table. They deserve a platform on which they can build and that allows them to sit at the top table as equals, not to be beholden to their rich benefactors. For the benefit of all four nations in the United Kingdom, will the Minister please support the plans for UBI pilots and allow us to move forward with a progressive welfare system that is practical, compassionate and fit for this century?