Scotland and UBI

Should an independent Scotland consider introducing a universal basic income?

During this Coronavirus lockdown. many people, including me, have been posting on blogs and social media about their current or past lifestyle. They write about and share photographs of meals they have cooked, bread they have baked, things they have crafted and walks and holidays they have enjoyed in the past.

A perspective on posts like this that they are middle-class boasting of a lifestyle that many of our fellow citizens do not share. Thousands are ill and millions are out of work with worries about keeping safe, feeding their family and losing their home. When so many people are worse off than yourself, it can be seen as insulting to write about your banana bread, the insect hotel you have built in your garden or your walk last year on the West Highland Way.

It’s certainly true that there’s a degree of egotism in maintaining your own website although perhaps rather less than sharing via social media such as Instagram. Its equally true that much of what I, and many others, do and write about is essentially frivolous. However, this is something I do for my own entertainment. Creative activities such as building a website, cooking or crafting are no better or worse than reading novels, playing computer games or watching box sets on Netflix.

Realistically, whether or not I write about my dinner, past walks in the Highlands or anything else will make no difference to social equality. I have huge sympathy for those badly affected by the coronavirus crisis but individuals are limited in what they can do in the short-term. In the longer-term, I believe that we need radical political change to ensure that future crises have a less traumatic effect on individuals than the current pandemic.

The starting point for this is the introduction of a Universal basic Income (UBI), a fixed sum paid monthly to all adults. It’s hard to know what the right level for this is but it seems to me that a reasonable starting point is the current retirement pension - about £6500/year.

In the UK, our tax laws are a complete mess. They have grown piecemeal over the years with various incentives introduced to support one government policy or another. Governments are reluctant to change these because any change leads to their being some losers. The net effect of the complexity of the tax laws is that the better off in society benefit from them more than poorer people and the richer you are, the lower the proportion of your income and wealth you pay in tax.

To my mind, we need radical tax reform and I would start by scrapping all tax allowances and equalizing the tax rates on income and wealth. I would introduce a Universal Basic Income for all citizens and, only then, see if there are special cases where a small number of tax allowances might be reintroduced. These changes would lead to a significant reduction in the costs of running government services but, I accept, that significant increases in the current rates of tax would also be necessary.