Issues with the benefit system

[telstarbox]

UBI won't stop people working and earning on top, particularly for highly paid or skilled work. It would just knock out some of the unproductive work that currently exists in the economy.

It would probably encourage a lot of people on middle incomes to go down to 3 or 4 days a week if they currently work 5, with no loss of income overall.

 

[E27007]

UBI won't stop people working and earning on top, particularly for highly paid or skilled work. It would just knock out some of the unproductive work that currently exists in the economy.

It would probably encourage a lot of people on middle incomes to go down to 3 or 4 days a week if they currently work 5, with no loss of income overall.

A point in favour of UBI is low and fixed cost of administration.
Another point is the money paid goes directly to the target, the worker, thinking of how under QE of the spend was £945 billion, and a good chunk of the £945 billion did not land where intended, ie prosperous companies using QE money to buy back and solidify their shares on the stock market

 

[Dai Corner]

A point in favour of UBI is low and fixed cost of administration.
Another point is the money paid goes directly to the target, the worker, thinking of how under QE of the spend was £945 billion, and a good chunk of the £945 billion did not land where intended, ie prosperous companies using QE money to buy back and solidify their shares on the stock market

I thought UBI was paid whether the recipient worked or not? A passive income, if you like, rather like a shareholder of a company who doesn't work for it, merely providing the capital.

 

[The Ham]

That's a good point. You can add to that the question of, would the UBI (Universal basic income) be for residents of the UK or only for citizens of the UK who are also resident here? If it's all residents, you've suddenly made all the problems with dealing with immigration much worse because everyone is going to want to find any excuse to get a visa to live in the UK if it means you immediately get automatically given UBI. On the other hand, if it's only citizens, then you've just created a vast inequality between UK citizens - who all receive UBI, and non-citizen residents - who don't.

Also, your point about not giving it to citizens who go and live abroad is a good one, but the flip side to that is that if you insist on that people must be resident in the UK to claim UBI, emigration of UK citizens to live abroad will suddenly drop to almost zero (not only that but you'll see a sudden overnight influx of loads of people who currently live abroad - returning here so they can claim their monthly salary-for-doing-nothing).

A lot of those issues would disappear with a change in the tax rate.

Probably the simplify way to "enforce" to whom it is payed is to require all claimants to be registered in the UK for tax purposes and all gross income (regardless of where earned) would be taxed (this would also mean a lot of people with a reasonable level of overseas income which is taxed locally wouldn't then claim UBI).

Other options would be to require two years of taxes to be paid before UBI is paid to non UK citizens

Whilst it could get you (say) £7,000 a year, that's going to be eroded fairly quickly with a tax rate of around 34% would mean that value is going to drop rather rapidly.

For instance if the state pension was then set at £7,000 (on top of the UBI) compared to (say) £11,000 currently

 

[Peter Sarf]

That's a good point. You can add to that the question of, would the UBI (Universal basic income) be for residents of the UK or only for citizens of the UK who are also resident here? If it's all residents, you've suddenly made all the problems with dealing with immigration much worse because everyone is going to want to find any excuse to get a visa to live in the UK if it means you immediately get automatically given UBI. On the other hand, if it's only citizens, then you've just created a vast inequality between UK citizens - who all receive UBI, and non-citizen residents - who don't.

Also, your point about not giving it to citizens who go and live abroad is a good one, but the flip side to that is that if you insist on that people must be resident in the UK to claim UBI, emigration of UK citizens to live abroad will suddenly drop to almost zero (not only that but you'll see a sudden overnight influx of loads of people who currently live abroad - returning here so they can claim their monthly salary-for-doing-nothing).

These pensioners might also be more likely to clutter up the UK NHS if they had to come back to live in the UK.

I vaguely recall that currently the state pension does not rise with inflation etc if the recipient no longer lives in the UK for enough (50% ?) of each year.

 

[swt_passenger]

These pensioners might also be more likely to clutter up the UK NHS if they had to come back to live in the UK.

I vaguely recall that currently the state pension does not rise with inflation etc if the recipient no longer lives in the UK for enough (50% ?) of each year.

I think it’s more complicated than that and depends on the exact country you’re living in.

 

[Peter Sarf]

Makes me think. I think there were differences for Europe/non-Europe for reciprocal health agreements but maybe for pension rights as well. Of course we don't have to worry about Europe/non-Europe any more !.

 

[E27007]

Makes me think. I think there were differences for Europe/non-Europe for reciprocal health agreements but maybe for pension rights as well. Of course we don't have to worry about Europe/non-Europe any more !.

For reciprocal pensions, reading around the subject of pension provision, UK recognised the problem 30 to 40 years ago, Pension reforms began in the mid-1980s, the same books said European states were lagging in pension provision reforms, one of the warnings was the UK may have been obliged to make major contributions to service the EU pension financial black hole. As a pensioner I'm happy with my lot, although I did pay 15% of my income for 25 years into a pension plan to secure a good retirement income.

== Doublepost prevention - post automatically merged: 8 Dec 2022 ==

How do you measure the value a personal carer or cleaner, say produces?

There is the value of unpaid work, ie volunteers who work yet are are not paid, the value of work performed by the voluntary sector of the economy is significant, UBI is a method of freeing those who would choose to divert some of their time away from paid employment to unpaid employment

 

[Dai Corner]

For reciprocal pensions, reading around the subject of pension provision, UK recognised the problem 30 to 40 years ago, Pension reforms began in the mid-1980s, the same books said European states were lagging in pension provision reforms, one of the warnings was the UK may have been obliged to make major contributions to service the EU pension financial black hole. As a pensioner I'm happy with my lot, although I did pay 15% of my income for 25 years into a pension plan to secure a good retirement income.

== Doublepost prevention - post automatically merged: 8 Dec 2022 ==


There is the value of unpaid work, ie volunteers who work yet are are not paid, the value of work performed by the voluntary sector of the economy is significant, UBI is a method of freeing those who would choose to divert some of their time away from paid employment to unpaid employment

I (and my employers) paid around 20% of my salary into my pension for 37 years and I paid off my mortgage and accumulated significant savings. As a result I could retire at 56 when my health deteriorated, though I don't qualify for any benefits as my health isn't poor enough to count as disability and I have too much capital. UBI would enable me to stop working too, but without the need to have made good financial decisions and gone without some things during my working life.

UBI surely values the work of volunteers as zero as they'd be paid the same if they sat at home and did nothing.

 

[Bletchleyite]

UBI surely values the work of volunteers as zero as they'd be paid the same if they sat at home and did nothing.

The whole point of volunteering is that you give your time without any incentive to do so other than a combination of enjoyment and of being motivated to do good for the community.

If you receive any incentive, particularly a financial one, it's not volunteering, it's paid employment. Out of pocket expenses are the most that can be paid while still considering it volunteering.

 

[Dai Corner]

The whole point of volunteering is that you give your time without any incentive to do so other than a combination of enjoyment and of being motivated to do good for the community.

If you receive any incentive, particularly a financial one, it's not volunteering, it's paid employment. Out of pocket expenses are the most that can be paid while still considering it volunteering.

Yes.

I suppose the difference is that working age volunteers normally need to support themselves and their dependents by doing paid work as well, but under UBI they wouldn't.

 

[DynamicSpirit]

I (and my employers) paid around 20% of my salary into my pension for 37 years and I paid off my mortgage and accumulated significant savings. As a result I could retire at 56 when my health deteriorated, though I don't qualify for any benefits as my health isn't poor enough to count as disability and I have too much capital. UBI would enable me to stop working too, but without the need to have made good financial decisions and gone without some things during my working life.

And therein lies the problem with UBI. I don't know your personal circumstances so I appreciate it may be hugely beneficial for you personally to stop working, but the problem is: While you're working you're probably generating wealth for the UK. If you and loads of other people like you stopped working because you're receiving UBI, then you'd no longer be generating wealth, and that means that the total output the UK produces would drop. It's inevitable that that would lead to a drop in average standards of living (because in the long run, the standard of living can only be as good as the output a country produces), so people would on balance be worse off. If the Government is spending loads of money paying UBI, but the country is producing less because of UBI then the mechanism for eroding all our standards of living would most likely be high inflation (unless the Government raises taxes to pay for it).

UBI surely values the work of volunteers as zero as they'd be paid the same if they sat at home and did nothing.

Agreed. UBI values anything that anyone does as zero.

 

[Dai Corner]

If the Government is spending loads of money paying UBI, but the country is producing less because of UBI then the mechanism for eroding all our standards of living would most likely be high inflation (unless the Government raises taxes to pay for it).

Raising taxes would make it even less worthwhile to work, leading to fewer doing so and taxes having to raised further. A vicious circle.

Talking of inflation, it's a great way of redistributing wealth from the 'wealthy' who see the value of their savings decline to those with debts. I may not be producing wealth any more but as my pension barely covers the loss in value of my savings I'm not receiving any either.

 

[Yew]

And therein lies the problem with UBI. I don't know your personal circumstances so I appreciate it may be hugely beneficial for you personally to stop working, but the problem is: While you're working you're probably generating wealth for the UK. If you and loads of other people like you stopped working because you're receiving UBI, then you'd no longer be generating wealth, and that means that the total output the UK produces would drop. It's inevitable that that would lead to a drop in average standards of living (because in the long run, the standard of living can only be as good as the output a country produces), so people would on balance be worse off. If the Government is spending loads of money paying UBI, but the country is producing less because of UBI then the mechanism for eroding all our standards of living would most likely be high inflation (unless the Government raises taxes to pay for it).

Conversely, I'd give up my job to try and start a company.

 

[The Ham]

And therein lies the problem with UBI. I don't know your personal circumstances so I appreciate it may be hugely beneficial for you personally to stop working, but the problem is: While you're working you're probably generating wealth for the UK. If you and loads of other people like you stopped working because you're receiving UBI, then you'd no longer be generating wealth, and that means that the total output the UK produces would drop. It's inevitable that that would lead to a drop in average standards of living (because in the long run, the standard of living can only be as good as the output a country produces), so people would on balance be worse off. If the Government is spending loads of money paying UBI, but the country is producing less because of UBI then the mechanism for eroding all our standards of living would most likely be high inflation (unless the Government raises taxes to pay for it).



Agreed. UBI values anything that anyone does as zero.

It depends on how much the UBI value is.

Few would just stop work if they're getting (say) £7,000, however it's enough of a safety net that people should be able cope if that was all that they have.

Obviously the other think is what changes to the tax rules are brought in and how that impacts on tax take and where individuals get to bring no better off.