Universal Basic Income is affordable and feasible: evidence from UK economic microsimulation modelling

Howard Reed; Matthew T. Johnson; Stewart Lansley; Elliott Johnson; Graham Stark; Kate E. Pickett

doi:10.1332/175982721X16702368352393

Universal Basic Income is affordable and feasible: evidence from UK economic microsimulation modelling

Howard Reed, Matthew T. Johnson^*, Stewart Lansley, Elliott Johnson, Graham Stark, Kate E. Pickett

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

29 Citations (Scopus)

79 Downloads (Pure)

Abstract

Critics of Universal Basic Income (UBI) have claimed that it would be either unaffordable or inadequate. This discussion paper tests this claim by examining the distributional impacts of three UBI schemes broadly designed to provide pathways to attainment of the Minimum Income Standard (MIS). We use microsimulation of data from the Family Resources Survey to outline the static distributional impacts and costs of the schemes. Our key finding is that even the fiscally neutral starter scheme would reduce child poverty to the lowest level achieved since 1961 and achieve more than the anti-poverty interventions of the New Labour Governments from 2000. The more generous schemes would make further inroads into the UK’s high levels of poverty and inequality, but at greater cost. We conclude by assessing fiscal strategies to reduce the up-front deficit of higher schemes, providing a more positive assessment of affordability and impact than critics have assumed.

Original language	English
Pages (from-to)	146-162
Number of pages	17
Journal	Journal of Poverty and Social Justice
Volume	31
Issue number	1
Early online date	6 Jan 2023
DOIs	https://doi.org/10.1332/175982721X16702368352393
Publication status	Published - 1 Feb 2023

Keywords

Universal Basic Income
microsimulation modelling
poverty
inequality
Minimum Income Standard

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

Access to Document

10.1332/175982721X16702368352393

JSPJ FINAL_Aug2022_MP_JM EJSubmitted manuscript, 502 KBLicence: CC BY-NC
JSPJ REVISED X Mattew, elliott stewart howardAccepted author manuscript, 432 KBLicence: CC BY

Cite this

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title = "Universal Basic Income is affordable and feasible: evidence from UK economic microsimulation modelling",

abstract = "Critics of Universal Basic Income (UBI) have claimed that it would be either unaffordable or inadequate. This discussion paper tests this claim by examining the distributional impacts of three UBI schemes broadly designed to provide pathways to attainment of the Minimum Income Standard (MIS). We use microsimulation of data from the Family Resources Survey to outline the static distributional impacts and costs of the schemes. Our key finding is that even the fiscally neutral starter scheme would reduce child poverty to the lowest level achieved since 1961 and achieve more than the anti-poverty interventions of the New Labour Governments from 2000. The more generous schemes would make further inroads into the UK{\textquoteright}s high levels of poverty and inequality, but at greater cost. We conclude by assessing fiscal strategies to reduce the up-front deficit of higher schemes, providing a more positive assessment of affordability and impact than critics have assumed.",

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note = "Funding information: This research was kindly funded by the Wellcome Trust as part of {\textquoteleft}Assessing the prospective impacts of Universal Basic Income on anxiety and depression among 14–24-year-olds{\textquoteright} (grant number 223553/Z/21/Z). For the purpose of open access, the author has applied a CC BY public copyright licence to any Author Accepted Manuscript version arising from this submission. Kate Pickett was supported by the UK Prevention Research Partnership (MR/ S037527/1) collaboration, ActEarly. UKPRP is funded by the British Heart Foundation, Cancer Research UK, Chief Scientist Office of the Scottish Government Health and Social Care Directorates, Engineering and Physical Sciences Research Council, Economic and Social Research Council, Health and Social Care Research and Development Division (Welsh Government), Medical Research Council, National Institute for Health Research, Natural Environment Research Council, Public Health Agency (Northern Ireland), The Health Foundation and Wellcome.",

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N2 - Critics of Universal Basic Income (UBI) have claimed that it would be either unaffordable or inadequate. This discussion paper tests this claim by examining the distributional impacts of three UBI schemes broadly designed to provide pathways to attainment of the Minimum Income Standard (MIS). We use microsimulation of data from the Family Resources Survey to outline the static distributional impacts and costs of the schemes. Our key finding is that even the fiscally neutral starter scheme would reduce child poverty to the lowest level achieved since 1961 and achieve more than the anti-poverty interventions of the New Labour Governments from 2000. The more generous schemes would make further inroads into the UK’s high levels of poverty and inequality, but at greater cost. We conclude by assessing fiscal strategies to reduce the up-front deficit of higher schemes, providing a more positive assessment of affordability and impact than critics have assumed.

AB - Critics of Universal Basic Income (UBI) have claimed that it would be either unaffordable or inadequate. This discussion paper tests this claim by examining the distributional impacts of three UBI schemes broadly designed to provide pathways to attainment of the Minimum Income Standard (MIS). We use microsimulation of data from the Family Resources Survey to outline the static distributional impacts and costs of the schemes. Our key finding is that even the fiscally neutral starter scheme would reduce child poverty to the lowest level achieved since 1961 and achieve more than the anti-poverty interventions of the New Labour Governments from 2000. The more generous schemes would make further inroads into the UK’s high levels of poverty and inequality, but at greater cost. We conclude by assessing fiscal strategies to reduce the up-front deficit of higher schemes, providing a more positive assessment of affordability and impact than critics have assumed.

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Universal Basic Income is affordable and feasible: evidence from UK economic microsimulation modelling

Abstract

Keywords

UN SDGs

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Cite this

Universal Basic Income is affordable and feasible: evidence from UK economic microsimulation modelling

Abstract

Keywords

UN SDGs

Access to Document

Other files and links

Fingerprint

Research output

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Cite this