Thursday, 1 August 2013

The arguments for Citizen's Income

If you've ever wanted to know what it was the pushed me over the edge and join the Green Party, it was discovering their policy on Citizen's Income. What is Citizen's Income I hear you ask? Well, it is a universal benefit that is not means-tested which everyone of working age will get and it will replace benefits such as Job Seekers Allowance and other out of work benefits. All people whether in work or not would receive perhaps something in the region of £90 a week (or whatever a decent minimum amount someone needs to live on will be in the future) on top of any earnings they may receive. Of course there would still be other benefits such as housing benefit, disability benefits, child benefits, etc for those people who needed that extra help.

What a radical and crazy idea, everyone of working age receiving perhaps £90 a week from the government on top of any earnings they get. What's the point in this? Surely people who are earning enough do not need extra money. Why should those financially well off get free benefits off the state? I'd like to remind you that even the very richest people in society receive free services from the state. Libraries, hospitals, refuge collection, well lit and paved streets (alright, the streets aren't always well paved), schools, the police force, the fire brigade, etc. These are all basically free benefits that are not means-tested and are available to every citizen in the country. You could argue that these services are not free to everyone as they are paid for out of tax and rightly so. But they are free at the point of use, and you do not have to prove that you come under some forms of criteria before you are allowed to use the service for free. Could you imagine what it'd be like if these services were only free to the poorest in society? I could just imagine Daily Mail readers hounding those poorest in society for being "benefit scroungers" and belittling and demoralising those who cannot through any fault of their own find well paid work. Well, actually no I don't see that happening, I don't think even well-off people would stand for being charged every time they wanted access to an NHS hospital or having to give the police force their debit card number. When it comes to those public services everyone is seen and treated as equals. There isn't much class divide in a hospital or library. Imagine if more benefits were non-means-tested. In some parts of the country the unemployed can claim free or reduced cost bus passes. A worker travelling on the same bus may have to pay £17 a week or £40 a month for the same bus pass, which is a reasonable chunk of their salary gone on travel expenses. There would be far less begrudging of the poorest in society in the buses if everyone in the country was entitled to a free bus pass. Instead of cutting a benefit that the unemployed receive and perhaps depend on, making it a benefit that all in society are entitled to will eliminate the division between the unemployed or low-waged getting something for free that other people have to work to afford. This forms part of the principle of Citizen's Income.
Isn't this just encouraging people not to work? The answer to that question is yes and no. The amount for Citizen's Income is only a little higher than the current Job Seekers Allowance. Those claiming JSA often struggle for money, and therefore when it comes round to buying interview clothes, getting the bus to look for work or travel to an interview, having access to a computer with the internet at their own home, etc sometimes they simply just cannot afford the basics to get them back into work. Having that little extra will help them when they find they need to buy a suit and shoes for an interview, or with getting a bus to town to hand out CVs to potential employers. Far too often unemployed people get stressed and worried about money when they could be focussing on finding work.

Similar to the Universal Credit that the current coalition government are trying to phase in, if you gain any form of employment you would keep all of your Citizen's Income. And unlike Universal Credit you would still receive your entire Citizen's Income if your income went up. This is an incentive to work. Currently if you work then your benefits go down and if you work over 16 hours a week you cannot claim any Job Seekers Allowance and you may be worse off if housing benefit and other benefits get reduced. With Citizen's Income you will always be financially better off in work. However, I will not pretend that Citizen's Income will make everyone want to find employment. It won't. There does need to be other measures to increase employment as well as make employment a more attractive proposal. So there would be people on Citizen's Income who will not try to look for any paid work whatsoever. Ultimately what I have to say to this is that does not matter. We live in a society that over produces. Over the last few decades production methods have gotten more and more efficient and machines now do the work that men and women used to do. Factories need to employ far fewer people to produce more goods than they did a century ago. In the 1970's and 80's people were told that these machines and computers would lead to people working less. This hasn't been the case, and working hours have actually increased dramatically. There are far more jobs in service roles than in production these days. Sales and marketing jobs are abundant. As a society, we do not need all of these new jobs that have been created. Pizza Hut often pay someone to stand in the street holding a sign with an arrow pointing in the direction of the nearest Pizza Hut. This is a job role that isn't needed by anyone, no-one need to see that sign, people can find Pizza Hut if they want to without the need of that person. I would argue that we are at a stage where society could easily provide the basics for everyone without the need for everyone to be in full time employment. More than a third of the food in this country is thrown away. More and more items are purposely manufactured to break easily so that people will keep buying those items and more items are produced in order to be used once and then thrown away. Computers, mobile phones, cars, video games consoles, and other technology is designed so that every few months or years people will need to update and buy a whole new version. A lot of this technology could be designed so that in order to get the new upgrade you only have to buy a small part and get that fitted rather than buying a whole new model. We can easily cut the total amount of hours worked. This brings me onto my next point.

Citizen's Income may actually increase employment. How? At present lots of people are over-worked and feel the need to work lots of hours to be able to afford a decent standard of living. There are people in full-time employment who would like some extra free time. Perhaps they've got children and would like to spend more time with their family. Everybody having an extra £90 a week in their pockets would allow more people to reduce their hours if they wished. This would mean employers would have surplus hours for employees and may have to employ more people. It's Green Party policy to reduce a full-time working week from 36 hours a week to 26 hours a week so that there would be more hours for people currently working less than 26 hours. The other benefit of this is the net contribution to the private sector. If more people are working, and if everyone has an extra £90 a week, more people can afford to spend more. People are more likely to visit their local shops, cafes, restaurants, cinemas, etc. This will result in those places employing more people, and then those extra new employees will themselves have more money to spend in the private sector.

But how will this all be paid for? Can we afford it? Along with Green Party policy to raise tax for the richest in society, and to tackle tax evasion and avoidance as well as other policies such as the Robin Hood Tax and clamping down on tax heavens, Citizen's Income can become affordable. Corporate tax avoidance, tax evasion and tax heavens costs the UK government an estimate £95 billion [1]. Let's say for arguments sake that this is 42 million people in the UK of working age and let's also say that Citizen's Income would be £90 a week. That would be £3.78 billion per week or £196.56 billion a year. The UK government currently spends £4.91 billion a year on Job Seekers Allowance[2]. A further total of £40.41 billion on in-work benefits including income support and working tax credits which would be saved if minimum wage was raised to a reasonable level, something that Green Party policy supports[2]. On top of that everyone on disability benefit would have £90 out of their disability benefit replaced with Citizen's Income. Roughly estimated that's 3.25 people[3], so that's another £15.21 billion. That makes £60.93 billion out of current benefit spending which would go towards Citizen's Income. That leaves a shortfall of £135.63 billion to make up. During the Second World War the highest level of income tax was 99.25%. In the 1950's and 60's this was reduced to 90%. In 1979 when Thatcher got into power it was 83%. By 1988 it had been reduced to 40%. At the present it is 45% but only for earnings over £150,000. Along with the £95 billion for corporate tax avoidance and tax evasion, reversing the declining trend of low levels of tax for top earners would easily cover more than the shortfall of £135.63 billion. Not to mention the potential extra income tax from the possibility of more people being in employment.

None of the above however give the real reason why I support Citizen's Income, just added extras. The anarcho-communist within me believes everyone should have the right to the basics in life - a roof over their head, food on the table, clothes to wear - a basic decent minimum standard of living, while at the same time I believe that if someone wants luxuries they should have to work for those luxuries. Citizen's Income would achieve this, giving people enough money to afford the basics in life while not giving enough money to afford many luxuries. All in all, society would be a bit of a better place with Citizen's Income. There'd be reduced poverty, possible extra employment, less class divide and greater equality.

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