There are those who’d like to see a Citizens Income in Scotland, or in the UK, and there were several submissions on that basis to the Expert Working Group on Welfare, who made a nod in that direction after representations from Ailsa McKay, sadly missed, who had been firmly committed to the principle. A report this month from the Centre for Welfare Reform develops many of the arguments. They don’t offer costings, but they do write:
“In the current UK system the least generous rate of Income Support is £2780 per year. If this was extended as a benefit to all 63 million people in the UK the total cost would be £169 bn. This is less than the current costs of all benefits and pensions in the UK (£185 bn).”
I ‘ve been doing some back-of-the-envelope calculations for Scotland. As things stand, benefits in Scotland cost £17.7 billion, and personal tax allowances – an important part of the potential funding pool – cost probably £6.8 billion. That makes £24.5 billion, but from that we probably have to knock off some benefits that can’t be replaced by a basic income, such as £0.9m disability benefits or £0.3m payments to expatriates. The population of Scotland has roughly 1.1 million pensioners, 3.3 million people of working age (16+) and 0.9 million children. I’ve argued in previous writing for a simple equivalence scale: 1 for the first adult in a household, 0.5 for each subsequent adult and children. There are 2.4m households, so there are 2.4m first adults. The pot needs then to be divided into 7.4 million shares, and comes to £3135 pa, or £260 pcm. Let’s call it £250 a month, because this is after all a quick demo. There’d be £250 for each household, £250 for each adult, and £250 for each child.
It sounds attractive at first, but I’m not at all convinced. This would be good for lots of people, but bad for others. As the figure includes a replacement for Housing Benefit, people on high rents wouldn’t get their rent paid. Getting rid of personal allowances means that all income will be liable to tax. Getting rid of Tax Credits may appeal but there have to be different arrangements for low paid work (a higher minimum wage) and for child care. On £500 pcm for a single pensioner, and £750 for a couple, pensioners would lose out – Scotland’s Future promises a single pension of £160 pw – and try to explain to anyone why a blind pensioner should get less benefit so that we can have a simpler system. Benefits are complicated for good reasons, and while there is certainly a case to offer more benefits like Child Benefit on a simple, unconditional basis, this kind of short-cut won’t meet people’s needs.