The Royal Society for the Encouragement of Arts, Manufactures and Commerce (RSA) has proposed to the government that every British citizen under the age of 55 be paid £10,000, according to Telegraph.
Under the proposal, each person would be able to request a ‘dividend’ payment of £5,000 twice, at a time that suits them best within a decade.
>>>Scotland is testing universal basic income
The funds would be generated either through increased taxes on the wealthiest or contributions from large corporations, thereby forming a sovereign fund called the Universal Basic Opportunity Fund (UBOF). The fund would be based on the Norwegian model, which is currently worth over a trillion dollars, with an annual return of 4.1 percent.
Those who will lose their jobs due to automation in the 2020s would benefit the most. Although the RSA does not foresee that automation will lead to mass job losses, they consider it inevitable that the labor market will transform, requiring many adjustments.
>>>VIDEO: The basic income experiment has begun in Ontario
The statement notes that the government could establish a fund by borrowing £200 billion at historically low interest rates, which could potentially yield returns due to economic growth driven by the fund’s investments.
Without special verification
Although the entire project would cost around £14.5 billion annually, the RSA emphasizes that the government could save from cuts to state benefits such as child allowances, tax credits, and unemployment benefits. While no special verifications will be conducted, all applicants will have to demonstrate how they intend to use the money.
While there are many variations of basic income, what they have in common is the reform of the welfare state and payments to all citizens, regardless of income. The unemployed would receive monthly allowances even if they are not seeking work.
>>>The largest basic income experiment in history has just been launched in Kenya
The popularity of the idea is growing as the level of automation increases, and proponents believe that basic income could help an estimated 3.6 million people who will lose their jobs by 2030 due to automation.
Critics, however, point out that the model incurs enormous costs, and furthermore, the universality of the program is its key flaw. To raise funds, taxes would need to be increased, which would leave people without the money they need. An intervention like this in the labor market would distort supply and demand, making it impossible to find workers for some jobs.
