Councillors back call for basic income trial
GLASGOW councillors have backed a report which recommends carrying out a basic income trial. The city council has worked with three other local authorities, Edinburgh, Fife and North Ayrshire, as well as NHS Health Scotland and the Improvement Service over the past two years to explore the possibility of a citizens’ basic income (CBI).
A steering group has recommended running a three-year pilot scheme to understand the impact a CBI could have on poverty, unemployment and financial well-being.
Councillors have now agreed work on the feasibility of a CBI should continue and the report should be sent to the Scottish Government.
City Treasurer Ricky Bell told a meeting of the City Administration Committee the current pandemic shows the “time has come” for this idea.
He admitted there were difficulties, as any trial would require support from the UK Government, but added there were ways of working with the Government.
But Glasgow Tories leader Thomas Kerr said his party had withdrawn from the working group as it does not believe in universal basic income.
“This report hasn’t changed my mind on that,” he said. “State support should be targeted to those in need.”
Mr Kerr and his Tory colleague, Kyle Thornton, were the only councillors not in favour of endorsing the report and continuing work to explore basic income.
A team of researchers from the Fraser of Allander Institute at the
University of Strathclyde, Manchester Metropolitan University and the Institute for Public Policy Research Scotland have modelled the economic impact of a basic income.
They looked at two options: a lower level basic income and a higher level, which used the Joseph Rowntree Foundation’s minimum income standard as a guide.
Weekly payments on the lower income would be £84.54 for anyone up to 15, which would be paid to their main carer, and for those between 16 and 19.
It would drop to £57.90 for people between 20 and 24 before rising to £73.10 between 25 and pension age. Those above the pension age would receive £168.60.
With a higher income, those under 15 would get £120.48 per week, anyone aged between 16 and pension age would receive £213.59 and people above the pension age would get £195.90.
The cost of a lower basic income is estimated to be £27billion, with the high-level income at £58bn.
The Fraser of Allander Institute has stated: “Although savings could not be realised within the current devolution framework, around £20bn could theoretically be offset via replacing existing benefits (including the state pension) and eliminating the personal allowance.
“This leaves around a £7bn funding requirement for the lower level CBI and around £40bn for the high level.”
The Fraser of Allander Institute’s model looks at the impact of using income tax to pay for the remaining cost.
“To fund the lower level basic income, an increase in eight points on each Scottish income tax band would be required, with people paying income tax on even the first pound of income because of the abolition of personal allowance.”
Mr Bell said income tax was “one way” but: “There’s a whole variety of ways you could fund it.”