Switzerland rejects Basic Income, but what about UK?

Posted on Jun 10th, 2016 | News and opinion

Campaigners for a Universal Basic Income (UBI) – the policy allowing citizens a regular, unconditional sum of money to cover their living costs – faced disappointment this week in Switzerland.

Supporters across the globe say that UBI would provide recipients with a financial safety net, making it easier to start a business, learn new skills, boost the art scene, spend time with their children or care for elderly relatives.

Hopes were high after 100,000 Swiss people signed a petition to trigger a referendum under the country’s ‘popular initiative system’, but 77% of the electorate have resoundingly rejected its implementation.

The proposal in this case would have given each citizen just under £1,800 a month whether they were in work or not (plus around £445 for children). To contextualise, the cost of living in Switzerland according to Numbeo is almost 60% more than in the UK, and the Swiss average wage is currently around £2,840 per month.

What went wrong?

Despite the pro-UBI movement gaining enough support to generate a national vote, it lacked backing from the Swiss government – who had urged the public to reject it – as well as their opposition parties. As a result, no clear indication was able to be given regarding how the scheme would have been funded.

Curiously though, politicians opposing UBI were less concerned with how it would be paid for, but moreso about the effects the bold shift would have on Swiss society. Critics claimed it would encourage laziness, whilst making the country much more attractive to economic migrants.

“Theoretically if Switzerland were an island it would be possible,” Luzi Stamm, a representative of the Swiss People’s Party told the BBC.

“You could cut down on existing social payments and instead pay a certain amount of money to every individual. But with open borders it’s a total impossibility. If you would offer every individual a Swiss amount of money you would have billions of people who would try to move into Switzerland.”

However the RSA’s Anthony Painter, who has led extensive research into the potential of a Basic Income policy for the UK, rejects such accusations explained:

“Human anxieties about free-riding are deeply embedded in our psyche, but they play out most harshly when it comes to the weakest and the poorest. We don’t think for a minute that a handsomely paid chief executive might be demotivated by their large income, but suggest £70 a week for every citizen would mean we’d take to our couches en masse.”

With a firm political backing and a fully costed proposal tackling these reservations, it remains to be seen whether this story may have had a very different outcome.

For Switzerland, it may be back to the drawing board, but basic income may be set to make headlines closer to home, as the Labour Party is currently considering the possibility of making a version of it their official economic policy, replacing our current welfare system.

UBI in the UK?

35 MPs from various parties have so far signed an Early Day Motion pushing for the idea to be examined further in the UK, and Shadow Chancellor John McDonnell recently said research from campaign group Compass “makes an interesting case for a universal and unconditional payment to all, which could prepare our country for any revolution in jobs and technology to come. It is an idea Labour will be closely looking at over the next few years.”

Labour leader Jeremy Corbyn has expressed interest, but clarified that the details would need working out; advocating such a huge change could end up being detrimental for the party’s reputation if its senior members are not able to fluently rattle off exactly where they expect the money come from.

The RSA (Royal Society for the encouragement of Arts, Manufactures and Commerce) may have already done much of the ground work for them, recently publishing optimistic calculations alongside claims that despite sounding like ‘a utopian dream’, the policy would be ‘feasible, desirable and beneficial’.

Do the public actually want it?

Where UBI is reported on, the word ‘radical’ is nearly always used. But as far-fetched as it may seem, almost two thirds of the British public support the principle.

An opinion study by German polling organisation Dalia Research asked respondents whether they would support “an income unconditionally paid by the government to every individual regardless of whether they work and irrespective of any other sources of income”, which would “replace other social security payments and is high enough to cover all basic needs”.

10,000 people from across the EU were asked, and out of those in the UK, 62% said it would support this proposal (although it’s worth considering that the poll did not give any indication of how the country would afford to introduce it).

Workers union GMB recently voted in favour of lobbying for a basic income for everyone, thus becoming the first large UK trade union to support the idea. National organiser Martin Smith admitted “This idea seemed bonkers a few years ago but is time we seriously looked at this now”.

GMB delegate Nikki Dancey predicted: “Very soon we could be looking at a society where there will not be enough work for everyone because of technology and digitisation, so people will need help having a basic income.”

Time to try it out?

The polls leading up to the Swiss referendum never gave much hope of victory, but many campaigners see the event as a victory in itself – in that it had people worldwide considering the possibilities UBI could provide in the future. The underwhelming result might just serve as a lesson in how not to sell the idea to the public, and what creases would need to be ironed out to gain public support.

RSA Chief Executive told The Guardian, “A basic income is one those things where if the argument was made in the right way, all the assumptions we have about how people would react could be blown away pretty quickly.”

As with any bold move such as this, the phrase ‘look before you leap’ most certainly applies. At the moment there are trials about to be carried out in Finland and the Netherlands, and in our recent interview with Caroline Lucas, the MP for Brighton Pavilion, expressed that Brighton would be a great place to try it out if the UK were looking to trial the idea.

Would you support a trial run in your city? Let us know in the comments below.

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Written by Tom West

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