The inevitability of UBI?

I was asked to speak at a conference recently to explore the question: will technological change make a universal basic income (UBI) inevitable? As is normally the case I had too much to say to fit into my 5 minutes, so I thought I would expand on the topic here. 

There are 2 key parts to this question - will technology change how we work so much that something significant will be needed to maintain workers’ economic security, and if so, will UBI be the most effective and politically and publicly viable option? 

There are good reasons to argue both ways on both parts, so I’ll work through some of them, and then let you know where I stand. 

The pandemic has shown it is possible, given the right circumstances, for governments to find the ‘magic money tree’ and put billions of pounds into people’s pockets with minimal conditions. Without furlough, business loans and other bailouts, the social and economic impact of the pandemic would have been significantly worse. 

Covid 19 highlighted the inadequacies of our current social security offer, and has shifted public opinion: people who had never had to claim unemployment benefits before suddenly had to rely on UC, and many realised how difficult it is to live on. Conditionality and sanctions were temporarily suspended, in recognition of the immense challenges claimants would have had in securing new employment during the worst of the lockdowns. This demonstrated that something approaching an unconditional system is administratively and politically possible, albeit in very specific circumstances.

Support for and interest in UBI grew sharply in 2020, with many more people recognising and discussing the concept, finding it a compelling idea. This new interest continues a trend that has been visible for some years now, in which UBI is not just a marginal idea, but appeals to a wide demographic and political spectrum. 

Technological change is changing work, in ways more tangible for many of us than perhaps it had previously. We know that many jobs created by technological change are low paid, and poor quality: job growth since re-opening in the UK is strongest in low paid work. There is also evidence that the impact of technological change on work has sped up due to the pandemic: the need for social distancing for example has taken human workers out of the equation from customer service functions in hospitality, a change that may ordinarily have taken several more years. 

We are also seeing the spillover of gig economy practices and outsourcing into new sectors, not just those we usually associate them with. A recent report from the Institute for the Future of Work shows how more ‘white collar’ and higher paid workers are experiencing the challenges of gig practices such as algorithmic management and automated surveillance. With more people finding work precarious and losing autonomy, support for more than a basic ‘safety net’ might increase. 

When I looked into how UBI had made it onto the policy agenda in different locations (Ontario, Finland, Netherlands and Scotland) back in 2017, I found some remarkable similarities across all 4 places. It was evident that a single driver of policy change was not sufficient in all these cases; they all experienced multiple triggers and supporting factors coming together at the same time. 

Among these factors were a sense that ‘traditional’ policy solutions were not keeping up with big challenges like poverty and unemployment, and that existing social security systems were failing to tackle these challenges; a growing awareness from both the public and politicians of UBI, and more people being comfortable with ‘radical’ solutions; and the importance of advocates, campaigners and experts to raise awareness and legitimise UBI. We can see all of these in effect in the UK, and other countries, more than they have been in some time. 

However, this does not all add up to a UBI becoming inevitable (I’m not sure we can say much is inevitable after the last 2 years). 

We have lived through major periods of technological change before, and nothing as radical or universal as UBI has appeared. The prevailing narratives around unemployment and poverty continue to focus on the individual being at fault, and there is still a division between the ‘deserving’ and ‘undeserving’ poor. This works strongly against the possibility of a fully universal UBI. Government’s recent cut to UC shows they remain wedded to the idea that work is the best route out of poverty, however much we know that not to be true for a great many people. Again, this demonstrates how far there is to go politically on the idea of a universal and unconditional payment. 

For most of us, technological change is not going to entirely wipe out our jobs, but change the skills we need and the ways we work. The idea of robots taking all our jobs is just not realistic. Yes, we are seeing a rise in poor quality and low paid work - much of the employment growth in recent months has been in lower paid sectors - but this isn’t a trigger in the same way as the pandemic was. This trend has been in evidence for years with no intervention of the magnitude of UBI. 

What we have seen is some incremental change, such as the annual rise in the minimum wage, and some (limited) progress on the government's good work agenda. The pandemic was sudden, but (despite the pandemic-related acceleration) technological change’s impact on work is fundamentally gradual, and should give us time to adapt.

Maybe the 4-day week campaign that’s gathering pace will bear fruit, and there will be more work to go round. Maybe the prevailing approach, helping people displaced by tech to adapt through things like retraining and careers advice, will continue and expand. While the efficacy or ethics of these interventions is up for debate, it doesn’t look likely that we’re about to see a sudden shift in the world of work of such magnitude that it would force policymakers to change course and identify UBI as the most favoured option.   

We also need to resist the technological determinism implied in the original question. The idea that changes like increased automation automatically translate into lower wages and less jobs, with nothing we can do to intervene or mitigate, needs to be questioned. Technological change also creates jobs. Right now, we see the poor quality, insecure ones most clearly, but there are also better paid and higher skilled jobs within tech and in other growth sectors. With the right will and investment these could be alternatives for those displaced by technology. 

This all adds up to a need for major ideological change if UBI is ever to rise to the top of the policy agenda. The pandemic necessitated urgency, and speed had to trump other concerns like fraud and ‘lazy’ jobseekers, but given a longer lead-in time, these reasons not to embrace UBI will flood back in. 

Welfare policy has a long history of being borrowed and translated around the world, particularly between the US, UK and Australia, but also in Europe. Having recent, successful examples of UBI from our ‘policy neighbours’ could go some way to opening up more space on the agenda for it here. 

There are lots of current and proposed trials in the US, but most are at city or state level, where they enjoy greater devolved tax and benefits powers that we just can’t replicate in the UK. And we’re yet to see any countries take the plunge in a big way. Most pilots have had to take a pragmatic approach and adapt the ‘pure’ form of UBI into something that is administratively and politically achievable, and test it on a relatively small scale. It will be interesting to see the international impact of somewhere launching a UBI on a wider scale; will this lend it credibility beyond an interesting experiment that might win over some of the unconverted? 

We must be careful of assuming the proliferation of UBI experiments means a swathe of places are on the verge of fully adopting a UBI. When I spoke to someone close to the Finnish experiment, they felt it was always going to be just an experiment, never a prelude to wider policy change. Experiments are vulnerable: just look how quickly Ontario shut theirs down when their political leadership changed. And when the pure idea of UBI collides with reality, for example on costs or complexity to set one up for real, the idea can lose its shine. 

Personally, I’m not holding my breath for a full UBI any time soon. I prefer a more pragmatic and incremental approach that learns from UBI principles but implements them as and when possible, rather than waiting for one big seismic shift. This would include the removal of sanctions and conditions, not withdrawing benefits at a steep rate when someone earns more, and reducing barriers to apply and qualify for benefits, as we know that many eligible people do not claim what they are entitled to.  

Of course, I would be fascinated to be proved wrong!

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(c) Anna Dent 2021. I provide research, writing, expert opinion and project development in Good Work and the Future of Work / Welfare benefits / Ethical technology / Skills