Switzerland is poised to hold a referendum on introducing the concept, and Finnish and Dutch pilots are set for 2017
June 2, 2016
To its acolytes, it is the revolutionary policy idea whose arrival is as urgently needed as it is inevitable. In a future in which robots decimate the jobs but not necessarily the wealth of nations, they argue, states should be able to afford to pay all their citizens a basic income unconditional of needs or requirements.
Universal basic income has a rare appeal across the political spectrum. For those on the left, it promises to eliminate poverty and liberate people stuck in dead-end workfare jobs. Small-state libertarians believe it could slash bureaucracy and create a leaner, more self-sufficient welfare system.
In an increasingly digital economy, it would also provide a necessary injection of cash so people can afford to buy the apps and gadgets produced by the new robot workforce.
Crucially, it is also an idea that seems to resonate across the wider public. A recent poll by Dalia Research found that 68% of people across all 28 EU member states said they would definitely or probably vote for a universal basic income initiative. Finland and the Netherlands have pilot projects in the pipeline.
This weekend the concept faces its first proper test of public opinion, as Switzerland votes on a proposal to introduce a national basic income.
The model on which Swiss citizens will vote on 5 June sits at the left-liberal end of the spectrum. The wording on the ballot paper is vague – it calls for the country’s constitution to be changed to “guarantee the introduction of an unconditional basic income” that guarantees “a humane existence and participation in public life for the whole population” – but the proposed scale is ambitious.
The referendum’s initiators suggest a basic monthly income of 2,500 Swiss francs (£1,750) for adults and 625 Swiss francs for children as a “working example”. Given the high cost of living in Switzerland, the initiative’s co-founder Daniel Straub says this would be the rough equivalent of giving people living in central Europe between €1,000 and €1,500 a month, or between £900 and £1,300 in the UK.
In a book published ahead of the Swiss referendum, Straub and his co-authors argue that a basic income pegged at such a level would not only free people up to do important work that is currently not incentivised by markets, such as care and climate change research, but also lead to higher wages for unloved and low-paid “dirty work”.
“If these jobs are really indispensable, then they have a social value and should be appreciated more,” he says. “If no one else wants to do them, they should be more highly paid. Work conditions would have to be improved so that people do these jobs.”
Set at such a level, a universal basic income would require an increase in Switzerland’s current social welfare budget. Even if it were to replace some benefit payments altogether, the country’s federal assembly has calculated an annual funding shortfall of 25bn Swiss francs, which it suggests would have to be bridged by tax increases. Some basic income activists have proposed a financial transaction tax.
Straub rejects some of the federal assembly’s calculations, but acknowledges that introducing a unconditional basic income would cost around a third of the country’s GDP. Switzerland currently spends 19.4% of its GDP on welfare, less than the OECD average.