Ten Types of People Who Would be Better Off with an Unconditional Basic Income

Geoff SimmonsTax and WelfareLeave a Comment

Yesterday we saw why our current benefit system is broken.

Instead of our complex, bureaucratic welfare system that stigmatizes the worst off people in our society, we think every adult in our country should receive an unconditional basic income. New Zealand is a rich country, we can afford it. An unconditional basic income recognises everyone’s right to a dignified life.

A universal basic income is an unconditional payment of $11,000 per annum (for example) that would be paid to every New Zealander over 20 years old. This payment ensures that every kiwi can have the basics and pursue a life with dignity. Lower payment are possible for teenagers and children.

Switzerland is holding a referendum on the issue, and the UK Green Party is now also backing the idea.

Here are ten groups of people that would benefit from an unconditional basic income:

1. One Income Families

If one parent is unemployed, or is staying home to raise children, they currently only get an income during the brief allowance for parental leave. An unconditional basic income would be paid to all adults regardless of whether their partner is working. This would allow people to pursue whatever activity is fulfilling and valuable to them – such as raising children.

2. Caregivers & volunteers

Currently our society doesn’t acknowledge the thousands of hours that some people dedicate to unpaid work. Caregivers and other volunteers contribute enormously to our wellbeing as a nation. An unconditional basic income would recognise that contribution.

3.Beneficiaries

With an unconditional basic income, most beneficiaries would be no better off than they are now (in fact sole parents would almost certainly receive a lower benefit).

However, they would no longer face the poverty trap, and would be rewarded for returning to work – no matter how much they did. No longer would they lose the benefit when they started earning income. They would be able to keep every dollar they earn, paying only the same tax rate as everyone else.

Also beneficiaries would no longer face eligibility criteria that depended on their life choices. Who they live with, how many children they have – would all be up to their personal choice, not the government.

4. Students & anyone retraining

Like the sound of a universal student allowance? That is what an unconditional basic income is like. Except even better – it recognises that retraining can happen throughout life, and that we might learn from experiences that aren’t part of the formal education system.

5. The working poor

The working poor would be the biggest winners under an unconditional basic income. They wouldn’t lose their unconditional income as they work more, so the working poor would be better off than they are now, and definitely better off than people who chose not to work.

For low-wage earning couples currently receiving Working for Families, most would still receive more money if both adults received an unconditional basic income. More importantly, they wouldn’t lose this income as they earned more, so they have a stronger incentive to work harder and smarter than they do now.

6. People without children

At the moment our benefit system favours people with children. Those that cannot or choose not to have children, lose out. Why are childless people any less worthy contributors to society?

7. Welfare organisations

If we get rid of the paperwork in our benefit system, we could get rid of an awful lot of bureaucracy. This would free up the time of voluntary organisations that currently help beneficiaries wade through our complex benefit system in order to get the support they need.

8. Anyone on infrequent income

Instead of having to constantly find their way through the WINZ benefit maze, people would be able to engage in the modern economy however they could. It wouldn’t matter when you earned income, and how much, and whether you earned it all in one week.

9. Anyone chasing their dream

People would be supported to pursue their dream job, whatever that may be; artistic endeavours, sport, or entrepreneurs wanting to start their own business.

In fact, some young entrepreneurs believe an unconditional basic income would be one of the most business friendly policies around. It would provide some secure income as entrepreneurs during the all-important start up phase.

No longer would people have to feel trapped in a dead end, demoralising job. With the security of an unconditional basic income they would have the option of taking a risk and creating a fulfilling job or business.

As Confucius said “choose a job you love, and you will never have to work a day in your life.”

10. Taxpayers

Finally, the taxpayer would benefit too. While an unconditional basic income is more expensive overall, at least the money will be going to people (including all taxpayers), rather than paying for an expensive bureaucracy. Depending on how the money is raised, the majority of Kiwis would be better off.

 

Want to learn more? Watch these short videos

 

 

 

Ten Types of People Who Would be Better Off with an Unconditional Basic Income was last modified: December 15th, 2015 by Geoff Simmons
About the Author
Geoff Simmons

Geoff Simmons

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Geoff Simmons is an economist working for the Morgan Foundation. Geoff has an Honours degree from Auckland University and over ten years experience working for NZ Treasury and as a manager in the UK civil service. Geoff has co-authored three books alongside Gareth.