Earning a basic income

Seventy-five years ago, the Beveridge Report identified five “Giant Evils” in society: squalor, ignorance, want, idleness, and disease. This report formed the crucible in which the system of national insurance was reformed and the National Health Service was founded by the subsequent Labour government. Although these Giant Evils have somewhat been tamed, more modern forms of want and idleness have grown up to replace them, as well as similar evils of obsolescence, isolation and disconnection.

The idea of a universal basic income is one that has been proposed to address these growing societal problems. The concept is that citizens receive a regular and unconditional amount of money from the government that is sufficient for their basic needs. There are many potential benefits of such a policy: chiefly, it would eliminate poverty and improve its associated societal costs such as poor healthcare and crime. Secondarily, by replacing income-based benefits such as jobseeker’s allowance, it would simplify and remove disincentives to work in the current benefit system, and could even encourage economic participation. Increased levels of automation in the modern world have made many jobs obsolete, particularly medium-skilled jobs. While the fear that technology could lead to mass unemployment is not a uniquely modern one, the range of professions that have recently disappeared or are currently under threaten is unprecedented. This has prompted some to suggest that a basic income will be essential to provide economic security as the number of people of working age becomes greater than the number of meaningful jobs that benefit society.

However, there are several barriers to the implementation of a basic income – both practical difficulties and ones relating to societal mindset – that prevent the concept from gaining wide acceptance. To overcome these barriers, basic income could be implemented in conjunction with national service to transition to a society with a new social contract: economic security in return for meaningful service. The proposal is not a universal basic income, but one that is implemented gradually and is accessible to all.

Practical difficulties and societal barriers

The first difficulty in offering a basic income is the financial one – how do we cope with the financial reality of giving a basic income to all citizens? A basic income needs to be affordable to society, otherwise it is not sustainable. A basic income also must be fair, reaching those who need the money. Several proposals have been made how this may practically be achieved. One proposal is a negative income tax – so that individuals earning low or no pay receive money from the government, rather than paying it in tax. However, this proposal suffers from the problem of the poverty trap – economically inactive individuals are discouraged from working harder and earning more due to lower marginal returns. It is also not radically different from the current status quo, and would be unlikely to lead to real social change.

Beyond the practical difficulties, progress must be made to address the objection that basic income is undeserved – that it is something for nothing. Equally, a basic income policy that discourages economic participation would undermine social cohesion, leading to a ghettoization of those who choose not to work, as well as a collapse of the economic system, as those paying tax would have to shoulder an increasing burden. A society in which we are rewarded for doing nothing will quickly stop being a society.

Benefits unlocked by national service

The proposal that I outline here is that basic income is awarded as a recurring payment for the rest of one’s life on the completion of national service (say, 1 to 2 years of service). National service need not only include military service – it could also include work in the public good (for example, work in hospitals, care homes or agriculture). Such national service would not be compulsory, but the prospect of a guaranteed annual income would be attractive to many – although if someone thought that they could earn more by forgoing national service (or simply didn’t want to participate), then this would be their decision. Equally, national service would not only be for the young – if a 40 year old who has recently been laid off was willing to undertake the service, then they would be free to do so. Essentially, basic income would function like a pension scheme, but one that is not delayed until old age.

The function of national service would be wide-ranging. It would be meaningful work in an area that is beneficial to society – ideally one in which there are current labour shortages (or shortages currently and unsustainably plugged by immigration). Current examples would include agricultural labour such as fruit picking and care home work. It should provide skills and training, particularly to the young, whilst being capable of being undertaken by those with low levels of existing skills. It should provide a sense of pride and achievement. It should help build community. It could also provide a way of integrating immigrants into society – in a similar way to how military service has historically.

By linking the policy of basic income with that of national service, the idea would be more palatable to the socially conservative – such an income could be offered retrospectively to those who have already served in the military or even essential services. As time passes, the numbers enrolled in the basic income programme would increase, the level of payments (note the words “payments” and “income” and not the word “benefit”!) would increase to the level where it truly is a basic income, and the idea of contributing to society in return for society supporting and underwriting you would become enshrined into national culture.

Such a basic income would not be universal – it would be earned. While it would replace much of the welfare system, such as unemployment benefit, it would not replace additional benefits for the most vulnerable in society – if individuals are unable to participate in national service due to disability, then they should be cared for by society. But for those who are able, payments would only be unlocked by participation – with the further expectation that their time in national service would provide a springboard towards meaningful work and participation in society, and away from a lifetime of dependence.

A basic income that addresses modern evils

Returning to Beveridge’s Giant Evils, although a universal basic income would go some way to addressing the problem of want, it would not address problems of idleness, obsolescence, isolation or disconnection. A basic income will only be beneficial if the policy is implemented in a way that promotes the building of a cohesive society. While this proposal to link basic income with national service would require a similar level of upheaval as that in the formation of the NHS, I believe it provides a vision of society that would address these modern evils – and one that would benefit all.