14th August 2023 - Sean Banks

England’s first universal basic income trial prepares to launch. Could it be the future?

Participants of a trial in England are set to receive an income every month without having to work. It’s the first time universal basic income (UBI) will be provided in England, and advocates argue it could be the future. 

The idea of providing citizens with UBI has been slowly gaining traction in the last couple of decades. Read on to find out more about trials taking place around the world, and why supporters claim it could be essential for future generations.  

What is “universal basic income”?

As the name suggests, UBI would provide every adult with a set income they can rely on. Unlike other forms of government monetary support, the income wouldn’t be conditional or means-tested – every citizen would receive the same amount.  

The core idea is that it would provide a minimum income people can use to cover basic needs, such as housing costs or grocery shopping. The income is provided in cash, rather than vouchers, so people could spend it how they like. People receiving UBI could still choose to work to boost their income. 

Advocates for UBI argue it will be necessary in the future as the job market rapidly changes.

Technological advancements mean some industries could reduce their workforce while maintaining, or even increasing, productivity. As a result, the job market could become far more competitive for workers and unemployment may rise. The theory is UBI could provide income to those affected by these developments.

Supporters also suggest UBI could:

As people won’t need to seek employment to pay for essential outgoings, some advocates even suggest UBI could drive wages up. 

Universal Basic Income faces opposition 

Of course, there are challenges to implementing UBI, and there are those who oppose the idea.

One of the biggest obstacles of UBI is the cost of delivering it. While UBI could eliminate the need for some benefit payments, such as the State Pension, providing every adult in the UK with a basic income would place a huge burden on the government.

As well as the cost of providing UBI, it could also lead to tax revenue declining if fewer people are working. 

Critics also suggest a significant proportion of people would choose not to work which could affect businesses. From an individual perspective, it’s also claimed that deciding not to work could lead to a lack of purpose and harm wellbeing. 

In contrast to the claim that UBI could increase wages, critics suggest the opposite would happen. As wages would no longer need to cover essential costs, businesses may simply choose to pay their employees less. 

England’s UBI trial participants will receive £1,600 each month 

Think tank Autonomy will carry out the UBI trial in England. Over two years, participants in Jarrow and Finchley will receive £1,600 each per month.

The trial will assess the effect UBI has on their lives, including whether they choose to work. It will also study how an unconditional income affects mental and physical health.

It will be some time before Autonomy releases the results from the trial in England. Similar studies from around the world could indicate what the latest research will find. 

The largest and longest-running study of UBI so far is in Kenya. Since 2017, GiveDirectly has led a study that has distributed a basic income to 20,000 people in more than 190 rural villages. Some individuals involved in the study will receive UBI for 12 years.

While the Kenyan study is still ongoing, initial findings suggest UBI has stimulated local economies. The research found it’s not only recipients that have benefited from UBI but the wider communities. 

UBI trials in Finland and Germany have also published findings:

Of course, it is difficult to draw truly meaningful conclusions from a small sample of controlled trials. If implemented, UBI will, by its very nature, be available to everyone. Not only would this be incredibly expensive, critics argue it may divert assistance away from the most vulnerable in society, who end up receiving a lower income than available via the current benefits system.  

Could you receive UBI in the future? 

With more trials taking place assessing the effects of UBI, it’s something that governments and other organisations may start to look at more closely. While UBI could be commonplace or even necessary in the future, it’s yet to be implemented on a large scale.

However, the results from the England trial could provide some interesting insights into how income, work, and families may change in the coming decades.

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