Child Poverty, Poverty

Bairns Come First

In this guest blog, Rhona from Fife Gingerbread looks at how a basic income could transform the issues surrounding child poverty. Fife Gingerbread supports lone parent, vulnerable and disadvantaged families across Fife.

Rhona Cunningham, Fife Gingerbread #BairnsComeFirst

Child poverty is finally getting attention from the Scottish Government, but what do people think of when they hear the word ‘poverty’ in a Scottish context? I would hazard a guess that they’ll imagine a lone parent or couple who are unemployed, and in most instances this will be the case. However, there are many families with parents who are employed but experience in-work poverty.

Even working full time on the National Living Wage, families are falling short when it comes to being able to afford to raise a child, by 12% for a couple with two children and 18% for a lone parent with one child. When you consider it costs on average (according to Centre for Economics and Business Research, 2016) £231,000 to raise a child to the age of 21 in the UK, that 12% – 18% shortfall is a serious amount of money.

Something that isn’t really coming up in the child poverty conversation is something that would help alleviate that shortfall for lone parents; child maintenance. Relationship breakdown and separation have both emotional and financial implications, often resulting in reduced household income, changes to housing circumstances, and employment. Women are more likely to take on caring responsibilities for children[1] and are more likely than men to experience a reduction in income as a result of relationship breakdown. Child maintenance has a vital contribution to make to households, particularly for costs that may be less visible such as childcare to help a parent maintain employment.

Photo credit: Katie Brand for Fife Gingerbread (#bairnscomefirst)

In Scandinavia, payments are guaranteed through the welfare system, while in the UK child maintenance is treated as a private matter, with families encouraged to reach a family-based arrangement with or without statutory support. Arrears owing to children from non-resident parents under the previous Child Support Agency stand at over £257million for Scotland (as at September 2016): an average of £4.3million per UK Parliamentary Constituency in Scotland. According to a recent consultation, it is likely that much of this debt will be written off, with a generation of children never seeing the money that should have been there to help meet a child’s everyday living costs.

While the old system was inefficient – costing 50p to administer for every £1 collected – the new Child Maintenance Service is not without its own problems. There is now a £20 fee to access the Child Maintenance Service, payable by the parent with care, disproportionately affecting women. If using the CMS’ Collect and Pay system, there are charges for the parent without care (20%) and deductions from what is paid to the parent with care (4%), which reduces the amount of child maintenance that a family receives while generating substantial annual revenue income for HM Treasury.

The reality is that two thirds of lone parents receive no child maintenance payments. Many families are facing hardship as a result of non-payments, with low income families being particularly affected by non-payment of child maintenance. Even where there are arrangements in place, levels of child maintenance are not viewed as adequate for a child’s needs.

Shielding children from issues arising from child maintenance arrangements can be difficult. Child maintenance can be used as a form of coercive control, and a way to have a continuing hold over a former partner and child. Irregular payments and inconsistency in the amount paid can make it difficult to budget for child and household needs effectively, creating financial hardship and stress. In cases where there is a successful child maintenance arrangement in place, parents often redistribute money across the household in order to meet the needs of all the children which can create tension within the household and affect children’s emotional wellbeing.

Imagine the difference that a basic income would make for children and families. As well as being universal and unconditional, a basic income would be paid to individuals, including children. The primary care giving parent would administer a child’s basic income on their behalf. This would provide a regular and reliable payment that households could use to provide for their children and to plan for their future, radically changing the context for conversations around child poverty, the value of caring, and making work pay.

[1] 95% of parents with care are female

This blog draws on Poverty Alliance research into Child Maintenance in Fife find out more here

Broken Welfare System

Inside the DWP – Debt and UCD372

A current employee of the Department of Work and Pensions approached us wanting to share insight into the distressing treatment of people currently dependent on the benefits system. They stressed the need for a dramatic change in our welfare system and advocated for a move to a basic income.

Anonymous Employee of the Department of Work and Pensions

A UCD372 suggests some hellish sort of missile, and for some it is just as devastating. A UCD372 is the debt letter sent out by the Department of Work and Pensions to ‘claimants’, as the government would like them to be called, but are called ‘customers’ by those who care a little more. The letter has no colour to speak of, it’s comprised of serious greys, bold blacks and stark whites and looks very ominous. The language is just as frightening, as ‘claimants’ are warned ‘You are now in a minority of people who have received money they’re not entitled to.’ – due to the inefficiencies of the Universal Credit system hundreds of these letters are sent out every single day, but the recipient is ignorant to these and will no doubt feel as if the whole weight of the DWP is coming down on them and a select few others.

This, and many other examples, bang several nails in the coffin of Universal Credit that claims to be efficient and better for the ‘claimant’. It is entirely possible, and all too common, for citizens to be in receipt of two overlapping benefits without truly understanding that they are. The confusion of legacy benefits, as the six older benefits that comprise Universal Credit are called, and the new Universal Credit itself is difficult enough for the DWP to handle, let alone a single individual traversing the benefit minefield.

This single scenario shows the inherent wickedness in our current benefit system and the welfare state. Even the language is sneering. ‘Claimant’, it rings of someone who is having to stake a claim, a right for the pittance that the state pays out. Claims can be challenged and denounced and the DWP often does. When debts mount up then the DWP will recoup them from one’s Universal Credit. Up to 16% of one’s total benefits can be claimed, with ease, to repay arrears of all kinds. When someone is trying to live on a meagre Universal Credit this is no small amount. The almost Orwellian language is just as wicked, ‘You are now in a minority’, it’s difficult to think of something more horrible to utter. In a world in which any government of the day spouts language about inclusion and cohesion in society, it must be horrid for the government to say that there are minorities and you’re one of them. These scare tactics would be denounced if employed by a debt collector who knocked on your door, but when the government use them all is well.

This common scenario alone shows the struggle that basic income advocates ahead have. The culture of the Department of Work and Pensions is not geared to providing for all. It is about conquering and dividing. It is about sanctions, threats and bullying. Yet, it should be a weapon in the basic income armoury. When we see the realities of the system currently employed and what it does to citizens it is difficult to justify treating a person in such a way. It becomes easier to advocate a basic income. A world in which people are not ‘claimants’ or ‘customers’, but citizens and their right to a monthly cash transfer is enshrined in that citizenship alone. A right that cannot be challenged, sanctioned or taken away. Where debts cannot mount up and frightening letters don’t arrive in peoples lives. Where poverty is not compounded not due to the individual but by failings of the state. When given these two examples, which are fundamentally about human decency and how one should be treated, not benefits, it is hard to stick with the system we have.

If you would like to write us a blog about your experience and why you want to see a basic income in Scotland get in touch team@cbin.scot

Entrepreneurism, Improved working conditions, Well-being, Work

Creating Better Working Days

Why don’t people spend time on their true passions? Here Alyona argues that, by providing a safety net for people in precarious employment and those on the brink of poverty, a basic income would allow people to invest time in their skills and talents.

Alyona Rogozhkina Happiness architect, Founder of the happiness at work project Sonas.

In an recent article by Guy Standing for Social Europe, (Left Should Stop Equating Labour With Work), I found a point about sustainable economic policy very appealing.

My background is in Behavioural Science, where I wrote my thesis called “Why people don’t spend time on their true passions?” According to the analysed survey responses of more than 200 people across the UK, most of the participants complained that work is rather the activity that they ‘have to do’ in order to be able to afford their lifestyle and then only to enjoy something that they love. Moreover, working/studying activity demonstrated quite a high level of boredom and less than average level of everyday happiness.

One of the powerful concepts that might help to invent a better future where individuals are supported to do more of what they want, I believe is the idea to implement Universal Basic Income policy – or “paying people for being alive”. It is certain that UBI is not an easy concept to implement and there are a few serious challenges that must be taken in mind when designing the implementation process. For example, it is important to create proper ways of inclusion for vulnerable and ‘hard-to-reach’ social groups such as the homeless, disabled people and immigrants. It might be that it is not the best idea to simply give the money to the disadvantaged drug addicts or alcohol dependent homeless because they may not value these benefits and spend their money to harm their lives even more. However, to compliment UBI for vulnerable citizens with proper advisory help (such as connecting with professionals who will equip them with information about a wide range of services that are available community or assist with the best ways to manage the budget) might be a sustainable forward-thinking direction for policy makers.

Even though UBI has not a certain reputation yet, there are a few reasons why it makes a lot of sense to continue piloting this concept in societies. First of all, UBI has the potential to resolve the dilemma between fighting unemployment and striving against poverty. Secondly, UBI could also be a catalyst for a generation of entrepreneurs – becoming not only a backstop for bad jobs, but the material condition for human fulfillment. Finally, looking at the forecast of futurologists it is very likely that by 2047 the planet is going to face “jobless future” where about 50 percent of employees would not be needed due to rapidly improving robotics and artificial intelligence industries.

It might be that all these future challenges have been exaggerated and the whole idea to change the labor market in a way that more people will have a chance to do what they want might sound like a utopia. One of the cynical views on implementing UBI is that people will regress by passing their time in pleasant leisure activities rather than improving their skills and talents. At the moment it looks like instead of spending time in passionate activities or living up their potential, most people are working in a desperate attempt to cling to their jobs because they need to support themselves and their families with basic needs. However, more and more people are trying out an uncertain freelancing journey, part-time and multiple jobs to brighten their future. Therefore, testing and developing UBI seems to be a promising path to a changing economic culture that might help both to support plenty of talents constrained by the present work-money system and to possibly lift some people up out of poverty and develop healthier local communities.

If you have expert insight into why we need a basic income in Scotland and would like to write us a blog get in touch team@cbin.scot

Health, Poverty, Well-being

Health, Poverty and Basic Income

I work in a busy, urban hospital in Canada. People come to our Emergency Department and Clinics because they suffer workplace accidents, or family violence, or flare-ups of chronic conditions. They are our patients because they live in inadequate housing, and eat poor diets, and work at brutish jobs if they are fortunate enough to have work, or struggle to qualify for income assistance or disability support if they are not. Our patients are worn down by years of low incomes and pervasive racism. Many struggle with self-harm, exacerbated by job losses associated with economic change. More hospital use is driven by bad luck than by faulty genes.

On days when I need a break from data, I drink coffee with patients like the thirty-five year old learning to cope after he lost his leg at the knee to diabetes, or the fifty-year old with multiple chronic conditions who looks decades older, or the young mother taking a break from the NICU where her little one, born way too early, struggles. I talk to patients who have been flown in for treatment from remote Northern reserves where First Nations people live in deep poverty. I meet people who are in the hospital because they have the great misfortune of being poor in a wealthy country that takes great pride in providing universal healthcare, but makes only a grudging effort to alleviate the ultimate cause of poor health.

A few years ago I began to look seriously for evidence that we can make the population healthier if we invest some of our healthcare budget upfront to address poverty, instead of downstream after poverty wears down bodies and minds. I remembered an old Basic Income experiment that took place in Canada in the 1970s called Mincome. That experiment, like others of the era, was primarily interested in whether the poor, given the option of a Basic Income, would work less. The experiment itself was a victim of changing governments, and its remarkable results went unknown for years. Labour economists in the 1980s showed that few people worked less – just as had been the case in the four contemporary US experiments, but they noted that pregnant women and “young unattached males” did work fewer hours. Married women were essentially using the Mincome stipend to buy themselves maternity leave at a time when the legal entitlement was only four (unpaid) weeks.

I went in search of the data, which I recovered in 1800 cardboard boxes. The old data tapes had become obsolete.

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I also talked to participants. Those who were high school students during the experiment, like Eric Richardson, gave me my first clue: he didn’t work because he was in high school. Many of his friends were also the first in their families to graduate from high school. They all told similar stories: before Mincome, low-income families encouraged their adolescent sons to become self-supporting as soon as possible. After all, there were jobs for strong, young men in the 1970s – in agriculture and in manufacturing. Both of these industries have suffered in the past forty years, and it takes little imagination to realize that the lives of these young men who left school before graduating would include job loss, retraining and disruption. When Mincome was introduced, however, some of these families encouraged their young sons to stay in school a little bit longer. The opportunities these young men would have in the next forty years would be very different from those that greeted their older brothers and cousins.

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The Richardson Family in the 1970s

I was less interested in labour than in health and wellbeing. Were these families happier and healthier? The participants certainly felt themselves better off. Amy Richardson, Eric’s mother who was widowed during the experiment, claimed that Mincome “made life easier. It was enough to add some cream to the coffee.”

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Amy Richardson, 2010

My statistical work supported my instincts: people who had a BI available to them were less likely to be hospitalized and less likely to visit their family doctors. One key reason was improved mental health.

In 2017, the province of Ontario in Canada began an ambitious 3-year experiment with Basic Income. Ontario, like many provinces in Canada, spends more than 50% of its budget on healthcare. Premier Kathleen Wynne was genuinely concerned about the well-being of the population, the challenges of young families and especially the mental health of youth. However, at least some politicians were intrigued by the suggestion that one way to get escalating healthcare costs under control might be to address the ultimate cause of many interactions with the healthcare system – poverty.

  • Evelyn L Forget, Economist and Professor of Community Health Sciences, University of Manitoba, Canada

Professor Forget is delivering a seminar on the relationship between basic income and health for the Glasgow Centre for Population Health on April 17th, 2018. You can book to attend here.

Uncategorized

Should we welcome Silicon Valley’s support for basic income?

An excellent recent article in Wired, The Paradox of Universal Basic Income, made several interesting points about, among other things, the impact of political motivation on basic income schemes (principally the decision by a conservative government in Finland to only give basic income to the unemployed). It’s a good read.

But why is a magazine known for its focus on technology talking about social security reform? I feel like since I first discovered basic income back in 2015 the loudest voices on the global stage have been coming from billionaires, especially those in Silicon Valley. This shouldn’t be a surprise given that anything someone of such a profile says or does necessarily generates media attention, but it reflects the fact that the most high profile argument for basic income seems to be the forthcoming automation revolution. In other words, basic income is positioned as a preventative measure against things to come.

This troubles me. Besides ignoring the fact that a basic income is necessary even without automation because of its ability to address the failures of the current system, these tech billionaires are talking about the automation revolution without acknowledging that they are the ones responsible for it. Its like a landlord advocating for more social housing for the tenants they are about to evict. I mean, yeah, thanks for supporting my cause, but would you mind not exacerbating the problem it addresses at the same time?

Whenever I give a talk on basic income, without fail someone will accuse me of Malthusian scaremongering about increased unemployment. Why won’t this tech revolution create new jobs in the same way the industrial revolution did?

For starters, the reason this revolution is different is because it is ‘brainwork’ that is disappearing, rather than physical labour. Technology is not at the point yet where you can speak to an AI without wishing a person could be there to help you, so surely you, the reader, couldn’t be replaced with a software program that could do your job as well as you? The sad answer is that you’re right, and it doesn’t matter. Think about the last time you navigated an automated telephone system. Was that as good or better than speaking to a human being right away? Of course not, but they were replaced anyway, because ‘good enough’ trumps ‘perfect’ whenever the price is right. And this is where Google, Amazon, IBM and a million little start-ups are taking us.

It is a step forward that our leading lights actually care, or profess to care, what happens to the rest of us when they make our work (and by extension, those of us narrowly specialised in this work) unnecessary. All they are doing is asking for a solid floor to society upon which they can widen inequality in their favour, and ensure there is money in the pockets of the population to buy their products. A modern twist on Company Scrip where workers exchange tokens for goods at an employer-operated store in lieu of a cash salary.

On balance, I do believe that the backing of these tech moguls for a basic income helps more than it hurts, but we need to claim the narrative back for the human rights argument for eliminating today’s poverty, and improving the quality of life for all of us right now, and not let basic income become too strongly entwined with a single argument based on a problem that is yet to fully manifest. And let’s not forget the role our would-be patrons play in this crisis of their own making.

Ben Simmons, CBINS Trustee – @vforfive