In Defence of Universal Basic Income

Written by Anne Gray 

As a member of the Green Party of England and Wales (GPEW) Working Group on Universal Basic Income (UBI), I take issue with Huseyin Kishi’s post on this blog. It seems he fundamentally misunderstands the GPEW’s proposals and the relationship of UBI to free public services:- 

* UBI is not an alternative to free collective public services that Greens defend and expand, like the NHS, social care, education, public transport and free childcare. Both are affordable – it’s a question of fiscal policy and the will to implement it. 

* Kishi’s cost figure of £331bn is hugely exaggerated; it was the GROSS cost, of the GPEW 2016 scheme, not the NET cost which is close to zero after Exchequer savings from abolishing many existing  benefits and tax concessions. Similarly, NET costs of the 2019 scheme were under £1bn. 

* With the addition of the carbon dividend (explained below), the GPEW rates were considerably higher in the 2019 proposal than in the 2016 one Malcolm Torry criticised in the Guardian. But in both years, illustrative calculations for household types comprising over 95% of households showed no losses compared to the Universal Credit (UC) system. Kishi mentions the Joseph Rowntree Foundation’s (JRF) argument that poverty would worsen if a UBI was introduced without also keeping means tested benefits. 

What JRF criticised were the schemes Compass rejected in a 2016 report[i] that JRF co-funded. Compass concluded, either keep existing benefits or fund a higher UBI by using  a wealth tax or higher corporation tax – and modelled some alternatives to illustrate that. The GPEW’s 2019 proposal has higher UBIs and lower income tax  than any of Compass’s  schemes. 

It introduces a carbon tax, which funds a ‘carbon dividend’ as part of the UBI, and abolishes some tax concessions the Compass report didn’t. However, in case of unusual needs, the GPEW proposal had about £1bn in a discretionary fund for special cases – perhaps a 12-child family, or a complex household with two Carer’s Allowances. 

* Kishi argues correctly that housing benefit has become a handout for landlords. The Green Party would address this through rent controls. For simplicity, most UBI proposals treat housing cost and disability support – which also needs to be substantially increased – as a separate issue.

The New Economics Foundation argument about UBI versus free public services assumes we cannot afford both. 

Surely we can? 

Drawing on corporate and private wealth to augment public spending is vital to reverse austerity in public services. Fiscal sources need to evolve gradually in the context of moving towards more public ownership, less inequality and a greener economy - probably towards more wealth taxes and land taxes. 

Compass (2016 report, pp 19-20) points out that reversing the 2015/6 cuts in corporation tax and fuel duties would raise around £19.5bn, and that taxes on wealth fell considerably in recent years. Since buildings cannot move overseas, the Green Party advocates a land value tax in the  long-term, to enhance redistribution and public spending. One could add; cancel Trident and cut subsidies on fossil fuels amongst other useful savings. 

Compass suggests replacing means tested benefits gradually, moving from an unconditional  supplement to existing benefits to a larger UBI. With reason, the GPEW says introduction of a UBI needs longer than one Parliament. The March 2019 Compass scheme[ii] envisaged long-term expansion of UBI  based on a ‘national wealth fund’ – income-earning public sector assets plus levies on corporate and private wealth. This would be a useful successor to a carbon tax, which if successful in reducing emissions would yield less over time.

UBI would be massively popular for two reasons: ending the ‘poverty trap’  and its abolition of benefit sanctions and means tests. Freed from the huge ‘marginal tax rates’ caused by benefit withdrawal at 63p of UC for each £1 earned, more people would take work even if casual or insecure.  

Claimants suffer untold stress from means-testing and conditions about work search and job-centre requirements, plus the five week wait for UC, threatening letters demanding repayments if the Department for Work and Pensions gets its sums wrong, and criminalisation of people who don’t report changes of circumstances when earnings vary from week to week.

The JRF critique of  Compass’s ‘full UBI’ proposals - the ones Compass rejected because they increased poverty – argues that the current benefit system achieves better targeting of monies at the most needy. Mainly because abolishing the personal tax allowance – a major funding source for UBI - makes the lowest incomes very sensitive to the new income tax rate. 

The rejected Compass schemes had a 30% standard rate plus national insurance at 12% on all income above the exemption band; GPEW 2019 has 32% ‘all in’ with no extra National Insurance. Compass’s latest (2019) proposal had standard  income tax at 23%, but  only 15% for the first £11,850 earned. The GPEW had instead a tax-free earnings band of at least £1000 at the bottom of the scale, partly to save people with tiny earnings from doing tax returns.

Perfect targeting at the poorest is impossible without high withdrawal rates of benefit on low incomes.[iii] UBI evens out marginal tax/withdrawal rates on income (counting the benefit taper rate for UC as a kind of tax). They fall for people dependent on state support, rise for those whose earnings help finance UBI. That fall in the effective ‘tax’ on the unwaged is crucial to fairer taxation and to ending the poverty trap. 

UBI is ever more needed in the post-pandemic period – to deal with mass unemployment and job insecurity, plus providing part of a fiscal stimulus. Its unconditional  nature is crucial. There are many UBI schemes and many ways to fund them. The JRF’s critique didn’t prevent Compass from initiating a major campaign for UBI to alleviate COVID-engendered poverty.[iv] It’s high time to join it and campaign for better public services as well. 

Notes

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[i] Universal Basic Income; An idea whose time has come, May 2016, https://www.compassonline.org.uk/wp-content/uploads/2016/05/UniversalBasicIncomeByCompass-Spreads.pdf.

The GPEW 2016 proposal had much lower income tax than in the ‘full BI’schemes that this Compass report rejected. 

[ii] https://www.compassonline.org.uk/wp-content/uploads/2019/03/Compass_BasicIncomeForAll_2019.pdf  ( March 2019). 

[iii] Kishi confuses this process with a means test taper – Natalie Bennett meant the tax take-back. 

[iv] https://www.basicincomeconversation.org/ 

Anne Gray is a member of Haringey Green Party and a supporter of Green Left

Universal Basic Income: Time for a rethink

Written by Huseyin Kishi

Senior Green Party Politicians proposal would increase poverty according to modelling.

Since 1983 the then Ecology Party, which was to be renamed the Green Party of England and Wales have argued for a National Income Scheme, later renamed the Citizen’s Income in 1990s and more recently known in the 2000s as the Universal Basic Income.[1] [2]In 2020 Jonathan Bartley in Bright Green heralded it as “...only universal and unconditional protection ensures that nobody is left behind.”[3]. Sian Berry opined “Universal basic income has been Green policy since long before I joined the party, and is exactly what it sounds like: a guaranteed income for everyone, replacing benefits in an unconditional way, which is ready and able to take care of your basic needs if a personal crisis hits.”[4]

For Greens it wasn’t a widely discussed policy until 2015, in which it was declared by the Guardian as “...The renewed focus on the cost and feasibility of a citizen’s income, including the way in which it would differ from the government scheme to integrate universal credit, demonstrates the extent to which Green policy is now being taken seriously. “

Baroness Bennett, who recently said in an interview with Green World “A universal basic income, to meet its proper definition, ensures that you can meet all of your basic needs with an income that comes to you simply for being a member of a society – unconditionally.” [5]

An idea whose time has come

For its proponents, it seems as clear as day for its implementation. A radical shift for welfare and the alleviation of poverty and unemployment. They then point to a Finish trial but a press release that was published in 2019 said “The positive evaluation may not relate to basic income as such but to public debate around basic income and to the fact that people were members of a selected group” adding “The Finnish experiment was about partial basic income targeting able-bodied people without work, it was not about universal basic income.” [6]

It did not do anything near what its proponents had argued – despite the positive headline in the New Scientist.[7] For the Green Party, in their 2015 manifesto they state “Scrap most of the existing benefits apart from disability benefits and Housing Benefit. Abolish the income tax personal allowance. Then pay every woman, man and child legally resident in the UK a guaranteed, non-means-tested income, sufficient to cover basic needs – a Basic Income”. [8] They followed this up in their 2019 manifesto by stating that it would be funded by a Carbon tax and additional payments would be made to those with children or were disabled. [9]

Impact

Molly Scott Cato said in her article for the Ecologist “...But a basic income would only provide fundamental security and would leave most people on lower incomes than they enjoyed before the crisis.”[10]

Moreover, Caroline Lucas in 2016, though in support of the policy, noted “A universal payment for all must not undermine additional help for those who need it most.” [11]  The party’s own consultation paper in 2015 stated “It includes abolishing most existing benefits, abolishing income tax allowances, changing employees’ National Insurance, reducing tax concessions on private pension contributions, and replacing the current contribution-based basic State Pension (for existing pensioners) and the new single-tier flat-rate Pension (for new pensioners) with a non-contributory Citizen’s Pension.” It would still pay housing and disability as additional payments and the total estimated cost was £331 billion.[12]

At the time the Independent noted “The Greens have since admitted that it “would not be practical or right to carry out that change within a single parliament.”[13] Sky News declared “The party says this is a long term ambition rather than concrete policy going into the 2015 election - but the thought of giving millionaires more money is likely to be a voter turn-off.” [14]

Individualism over the collective

There is an established example of an income-subsidy, though means-tested, that provides some economic support. It is called housing benefit and has been place since the 1980s. Sir George Young, the then Minister of State for Housing and Planning, remarked in 1991 that: 

“Housing benefit will underpin market rents-- we have made that absolutely clear. If people cannot afford to pay that market rent, housing benefit will take the strain.” [15]

Housing benefit now costs £22 billion a year and does not lessen the risk of eviction, improve the quality housing, nor the energy, utility and tax costs either. As the Institute for Fiscal Studies notes: 

“...for most working-age people it covers a lower proportion of their actual rent than was the case in the past.”[16]

Housing benefit – far from merely taking the strain when it was believed that the market would later expand for all income-bands – continues to grow and has now become a private landlord subsidy. An aversion to capital spending in housing and the shift to income-subsidy has not resulted in a housing market that competes on price, quality and amenities. More concerning, due to changes in housing benefit from 2011, rather than payment going directly to the landlord payments were paid instead to the tenant, this resulted in landlord arrears.[17]  Rather than benefiting the poorest, over the last three decades it has increased the property portfolios of private landlords according to Shelter.

Returning to universal basic income, In 2015 Baroness Bennett stated in the Guardian that a citizen’s income would be withdrawn when a citizen’s income reached an unspecified level.[18] Milton Friedman, the free-market economist, also agreed with the Green Party in their 2015 and 2019 manifesto, and instead proposed a negative income tax in his book  “Capitalism and Freedom.” Rather than benefits: 

“...he wanted to give poor people cash rather than an array of welfare benefits. People could then use the money as they saw fit”[19]

Likewise, in 2018, the Adam Smith institute proposed “Basic Income would ensure that ‘capitalism and efficient redistribution can be vindicated in equal measure”[20]

Assets over income-subsidy

Senior Greens often refer to UBI as increasing security and choice – but in effect – as was seen with housing benefit; this isn’t guaranteed. In fact, when Joseph Rowntree Foundation undertook modelling of it. They found that

“Those wholly dependent on state support would be neither better nor worse off if a UBI were introduced at the level of the current safety net. Those with modest earnings would benefit most from having the new non-means-tested payment. “ adding that “...it is not possible to raise the revenue needed to support them from taxation ­– even by increasing the basic rate to 30% from 20%. The UBI schemes also INCREASE poverty for children, working-age adults and pensioners compared to the current tax-benefit system: child poverty rises by over 60%. [21]“.

Similarly, the New Economics Foundation found “making cash payments to individuals to increase their purchasing power in a market economy is not a viable route to solving problems caused by neoliberal market economics” they also note that  “If cash payments are allowed to take precedence, there’s a serious risk of crowding out efforts to build collaborative, sustainable services and infrastructure”[22]

Senior Greens have stated we need a radical shift in thinking about welfare – but it is clear that universal basic income does not serve progressive ends and in that regard shares more in common with conservative thinkers and supporters of neoliberalism. They should instead look to take a leaf out of Karl Polanyi’s work – who observed that markets are planned as the economy is embedded into society and thus shaped by the state – but there has been previous resistance towards this – with the exclusion of market forces in welfare and housing in the 1940s.[23]

In order to provide unconditional protection while accommodating the most vulnerable. We should move away from the individualist universal basic income and its substantive costs. Instead we should look at the long-term collective and public ownership of universal basic services. Assets such as housing, information and transport would benefit us all.  

More information can be found here: universal_basic_services_-_the_institute_for_global_prosperity_.pdf (ucl.ac.uk) 

Huseyin Kishi is a writer and photographer based in London. He is a member of Sutton & Croydon Green Party

Notes

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[1]          https://green-history.uk/library/doc-archive/category/28-ep-manifestos

[2]          The Green Party | Social Welfare

[3]          Labour's failure to embrace UBI shows they haven't grasped the scale of the crisis | Jonathan Bartley (bright-green.org)

[4]          Sian Berry: This is the time to bring in universal basic income | Hampstead Highgate Express (hamhigh.co.uk)

[5]          The decade of universal basic income | Green World

[6]          https://www.helsinki.fi/en/news/nordic-welfare-news/heikki-hiilamo-disappointing-results-from-the-finnish-basic-income-experiment

[7]          Universal basic income seems to improve employment and well-being | New Scientist

[8]          Green.pdf (lancs.ac.uk)

[9]          Green Party Manifesto 2019.pdf

[10]          Coronavirus and the Universal Basic Income (theecologist.org)

[11]          The case for a Basic Income is growing | Caroline Lucas

[12]          Basic Income: a detailed proposal (greenparty.org.uk)

[13]          https://www.independent.co.uk/voices/editorials/general-election-2015-green-party-has-failed-make-its-mark-10196826.html

[14]          How Will Green Party's Medicine Go Down? | Politics News | Sky News 

[15]          House of Commons Hansard Debates for 30 Jan 1991 (parliament.uk)

[16]          Doubling of the housing benefit bill is sign of something deeply wrong - Institute For Fiscal Studies - IFS 

[17]          The impact of the direct payment of housing benefit: evidence from Great Britain (shu.ac.uk) 

[18]          Green party outlines plan for basic citizen’s income for all adults | Politics | The Guardian 

[19]          Negative income tax, explained | MIT Sloan

[20          Rising evidence for universal basic income — Adam Smith Institute 

[21]          Universal Basic Income - not the answer to poverty | JRF

[22]          Universal basic income: new study finds little evidence that it can live up to its promise | New Economics Foundation

[23]          https://www.dissentmagazine.org/online_articles/karl-polanyi-explainer-great-transformation-bernie-sanders

Fracking Protesters Jailed by UK 'Banana Monarchy' Judiciary

Written by Allan Todd

Although I’m the organiser of the anti-fracking Green Monday protests at Preston New Road, and am also the Membership Secretary of my local Green party, what follows is very much my own individual view, and must in no way be taken as necessarily representing the opinion of any other individual involved in the Preston New Road, Lancashire, protests, or of any organisation.

Fast forward to the past

This week, Preston Crown Court - or, to be more precise, Judge Robert Altham - took us back to 1932. For the first time since the Kinder Scout Mass Trespass, environmental protestors have been sentenced to prison for the offence of Public Nuisance. Though 7 peaceful environmental protesters were jailed for 28 days in 1993, for their part in the 1992 Tywford Down protests (against the building of M3), they were imprisoned for breaching an injunction in which they were named - not for Public Nuisance.

The Frack Free Four - Richard Roberts, Simon Blevins, Rich Loizou and Julian Brock - had previously been found guilty of Public Nuisance because of their involvement in what (so far!) has been the UK’s longest anti-fracking protest in July 2017, during Reclaim The Power’s month of anti-fracking Rolling Resistance. The 4 protestors had climbed onto lorries delivering pipes to Cuadrilla’s shale gas site at Preston New Road - and had prevented the lorries from delivering those pipes for a total of 99 hours, 31 minutes:

Judge Altham handed out prison sentences of 16 months to Richard Roberts (who had stayed on his lorry for a staggering 84 hours, 19 minutes!) and to Simon Blevins; whilst Rich Loizou received a prison sentence of 15 months. Julian Brock received a 12-month prison sentence, suspended for 18 months. The 3 sent to prison are the first people in the UK to be jailed for taking part in peaceful anti-fracking protests.  The crowd of about 60 anti-fracking campaigners, who had gathered outside the court for the start of the hearing, were shocked by the severity of the sentences:

One of the defence lawyers, Kirsty Brimelow QC, referred to an earlier ruling by Lord Hoffmann, who had said:

“It is a mark of a civilised society that it can accommodate protest.”

But, clearly, the UK doesn’t seem to be able to accommodate even entirely peaceful protest. As was pointed out in court, the motivation of the Frack Free Four was to act for future generations and the future of the planet; and, at all times, this was an entirely peaceful political protest against an industry that has been either permanently or temporarily banned in many European countries.

After the sentences were handed down, Rosalind Blevins, mother of Simon Blevins, had this to say:

“My son and the others were working under a social conscience for the good of the planet. I am proud of them for standing up against climate change. There is no doubt about climate change. 98% of scientists agree that climate chaos is happening. We have all got to stand up and reduce our use of fossil fuels now.”

Living in a ‘Banana Monarchy’

The severity of these sentences is just the latest in a series of democracy red lines that have been crossed which, I believe, has turned the UK into a ‘banana monarchy’ where freedom is increasingly eroded and corruption is rife. For instance, apparently Judge Altham didn’t think there was a possible conflict of interest in his dealing with the case, despite his parents being part of the Altham family business that supplies provisions to the oil & gas industry, including to rigs off the Lancashire coast!

The main red lines previously crossed are:

·       Massive Tory election fraud in GE2015, via over-spending in 33 key marginal constituencies. This was totally unopposed by all opposition parties - including the Green Party. This was despite my Emergency Motion, calling for the Green Party to campaign for by-elections in all those marginal seats, being overwhelmingly passed at our 2016 Spring Conference. The ILLEGAL Tory government, in 2016, overturning Lancashire County Council’s 2015 decision not to grant Cuadrilla permission to frack at Preston New Road.

·       Current attempts to alter planning regulations so that fracking companies can by-pass local councils

·       The wide-ranging injunctions granted against effective peaceful protests - no doubt inspired by the fact that, as a result of the Frack Free Four’s protests in July 2017, one of the lorry companies involved in the protest said it would not deliver to the site again.

On the positive side, it seems that, as a result of these prison sentences, more and more people are coming to realise just how our rights to engage in peaceful protest are being eroded. Consequently, there have been several comments pointing out just how far our rights are being reduced:

Miranda Cox, a campaigner against Cuadrilla’s operations in Lancashire and a Kirkham Town councillor, said: “This is a very dark day for British justice and for democracy.”

Whilst Greenpeace UK’s executive director, John Sauven, said: "It's a strange society that massively rewards those responsible for causing more climate change while putting those trying to stop it in jail. Ministers have changed laws, taken away homeowners' rights and distorted the planning process to make way for the shale industry, yet it's four peaceful protesters that get punished for climbing on a lorry.”

Green Party MEP, Keith Taylor, who has campaigned against the onshore oil and gas industry in south-east England, said: “Any government that conspires with the dirty fossil fuel industry against its own people is rotten to the core. Dissent is not a crime in any country with a political system fit to be called a democracy. Consequently, the sentences handed to the frack-free four are chilling.”

But it seems that things may get worse before they get better: just the other day, a young female protester’s arm was broken by a police officer at Preston New Road:

Young anti-fracking protester at PNR, whose suffered torn ligaments and heavy bruising to her arm during her arrest

Yet further evidence, if it were needed, how the fracking companies and their facilitators seem intent on destroying our democracy, as well as our planet. 

Spread out and disrupt

The injunction has clearly greatly reduced the number of people prepared to continue participating in effective non-violent direct action. Plus, once fracking actually begins at PNR, it will be increasingly unhealthy for protesters to stand outside the fracking site’s gates. In part, this will be because of the greatly increased diesel traffic that accompanies fracking.

In addition, whilst wells are being fracked, the flaring process - likely to take place 24 hours a day, 7 days a week - releases massive amounts of methane into the atmosphere. Government ‘regulations’ also allow other chemicals to be released: including benzene, acrylamide, ethylene oxide, toluene, bisphenol and several radioactive substances. Most of these are known human carcinogens which are linked, among other illnesses, to breast cancer and myeloid luekemia.

For all these reasons, it makes sense to start to widen out the scope of anti-fracking protests. Instead of focussing almost exclusively on the perpetrators of the climate crime that is fracking, maybe the time has come to take our protests to the many facilitators of fracking.

In fact, an excellent start along such lines has already been made by the 100 Women group from Lancashire: they paid a visit to Parliament Square on Wednesday 12 September; and, on Monday (1 October) will be taking their anti-fracking protest to the Tory conference in Birmingham:

Some of the 100 Women who have begun to take the anti-fracking protests to the country at large

However, I would suggest much more is needed: in particular, to disrupt the days of those disrupting our local communities and our planet’s climate. Certainly this is the lesson I have taken from the two Greenpeace actions I was part of this summer: one against Barclays Bank (a facilitator of new toxic tar sands pipelines in North America); as well as one against VW (a perpetrator of air pollution). Both actions were entirely peaceful - but also highly disruptive of the working day.  

Possible ‘legitimate targets’ for anti-frackers include government offices; Parliament, for approving changes to planning regulations; the financial institutions lending money to fracking companies; the High Courts handing out injunctions and, now, prison sentences; and the police.

If the dirty energy companies, and their many facilitators, think injunctions, prison sentence and ‘robust’ policing will stop the movement to protect our water, communities and climate from fracking, they are in for a surprise!

What is to be done now?

More immediately, though, we need to begin planning - NOW - for what we do once Cuadrilla have finally managed to carry out their first frack at Preston New Road.

What’s needed is a BIG national protest demo at PNR as soon as possible after that first frack.  Ideally, this should be on a Saturday, as this will enable as many people as possible to attend.

As well as members of other anti-fracking groups, activists of local Greenpeace and Friends of the Earth groups, and Green Party members and supporters, we really need to maximise the number of Labour Party and trade union branches.  

We need to show - in a highly visible way - that the reason the Frack Free Four were given prison sentences was because there is no social licence for fracking.

To do that, we need to start contacting all relevant groups and organisations - NOW. 

There is no time to waste.

To slightly misquote James Larkin:

“The powerful only seem powerful because we are on our knees. Let us rise!”

Allan Todd is a member of Allerdale & Copeland Green Party, an anti-fracking activist and a Green Left supporter