Starting in 2020, the world’s hippest social experiment will be arriving in St Andrews: the Universal Basic Income. First given funding for design and research purposes in 2017, the Scottish UBI trial increasingly looks like it will receive the green light for go-ahead. Should the programme move into its active phase, a randomly selected pool of citizens residing in the local authorities of Fife, North Ayrshire, Glasgow, and Edinburgh will receive a no-strings-attached payment of what will probably be between £75 and £150 per week for the duration of the trial period. The Scottish trial will likely follow similar models to that of ongoing trials in Canada and Finland which have produced promising results.
If you haven’t heard of UBI before and are wondering why the government would be handing out free money to citizens, you should have come to last week’s public debate hosted by our Union Debating Society. At the debate, Fife councillor David Ross and Emeritus Professor Felix R FitzRoy made a compelling case for why a UBI programme is not just worth exploring, but necessary in our rapidly evolving economy.
Mr Ross began by defining the goal of the Scottish UBI effort as an unconditional, non-withdrawable income as a right of citizenship in place of certain benefit schemes. He critiqued the existing Universal Credit programme as both not providing enough assistance to those who do receive it, as well as being opaque and bureaucratic to the extent that many people fall through its administrative cracks. A UBI programme, since it would lack means-testing, could be run with far fewer staff than existing programmes that devote significant resources to preventing welfare fraud and misallocation. Mr Ross also noted the increasing rate of child poverty in Fife over the past 10 years as a motivating reason for the push for a UBI in Scotland; there is a widespread belief in local government that the authorities in Westminster are unwilling or unable to address the problem.
Professor FitzRoy followed by explaining what he has concluded from over a decade of intensive research into UBI, one of his academic specialties. One of the professor’s core points was that a UBI offers distinct benefits to both the employed and unemployed that a traditional welfare programme does not. For unemployed people, a UBI offers an unconditional safety net that allows them time to build new skills and engage in a well-thought-out job search. Unlike traditional schemes, a UBI would not be cut off or tapered off should an unemployed person find employment; there is therefore no economic incentive to remain unemployed unlike with unemployment benefits. For employed people, a UBI can supplement existing income, allowing people with dependents (ex. children, elderly, disabled) greatly enhanced flexibility, ensuring better care for said dependent persons. A UBI might also serve to bolster the bargaining power of workers who know that, should they be fired due to unionisation efforts or strike action, they will still have some concrete income to fall back on.
The most contentious points raised in the debate here, as well as in the debate in the broader political sphere, were over the issues of cost and automation. St Andrews student Zaine Mansurali, speaking for the opposition, noted that a comprehensive UBI would cost hundreds of billions if not trillions of dollars for the United States, a cost too high for even the world’s richest nation. The contention that a UBI would be too expensive is usually disputed in one of two ways. The first rejoinder typically comes from right-wing, libertarian supporters of UBI who view it as a replacement for the existing welfare state. The cost of UBI would therefore be manageable, as all government funding previously devoted to other programmes would be spent on UBI instead. This line of argument, however, is not the dominant one among either the academic or public communities supporting the concept of a UBI. The other possible counter-argument, and the one made by Professor FitzRoy, is that payments under UBI should be kept as minimal as possible and should not serve as a replacement for a traditional income, but as a replacement for certain parts of the welfare system, such as unemployment benefits. The professor personally advocated for an amount allowing for basic necessities of food and housing.
Driving the increasing public debate about UBI is a worry, shared by academics and the general public alike, that the new wave of automation prompted by the development of sophisticated Artificial Intelligence technology will lead to widespread, short-term and possibly long-term unemployment. Predictions for the amount of workers displaced by automation in the next few decades wary wildly, from 15 to 60 per cent, but the looming possibility of automation-driven unemployment has fuelled interest in research on and trials of UBI schemes.
The argument most often used against fears of automation, and therefore the necessity of a UBI, is that post-industrial countries have gone through many previous waves of automation, transitioning the majority of workers first from agriculture to factory work, and then from factory work into the service and technology sectors. This, indeed, was the case made by Dr Jon Robert Stanley last Thursday, who opposed Professor Fitzroy by pointing out that the economic transition from coal to natural gas in his home region of Lancashire led to temporary economic troubles but ultimately had a positive effect on the local economy, with much lower unemployment. The counterargument to this, which came out during the floor section of last week’s debate, is that AI-driven automation is distinct from previous waves as it threatens both low- and high-skilled jobs in both existing and emerging industries; there is no economic sector where a sufficiently skilled AI system could not replace a significant portion of workers.
Regardless of what you think about the merits of UBI, in all likelihood Scotland will implement a trial of it in the next few years. But what does that mean for St Andrews – town and gown alike? For permanent residents, some will be selected to participate in the trial, which will lead to a modest influx of cash into the local economy. Whether or not it will have a noticeable impact to those not participating in the trial remains to be seen, as how many participants there will be and how much money they will receive will likely determine that. It is unlikely that non-Scottish students will be eligible to take part in the trial, as English and other foreign students’ spending outside of Scotland would be near impossible for the study to keep track of. Students from participating regions of Scotland will certainly be eligible, but it currently remains unclear whether or not students from non-participating regions will be or not. In any case, it is unlikely the Scottish trial will yield statistically meaningful results before the vast majority of current students depart St Andrews, so for a better idea of where UBI stands from an experimental standpoint, looking to overseas trials currently ongoing is your best bet.