In the final (for now) instalment of our series of blogs covering the basics of a Basic Income, Basic Income Network Scotland volunteer Luke Brotherdale Smith looks at why a Basic Income is paid to individuals not households. You can find the rest of the series here.
A Basic Income is paid to all individuals, as opposed to being given in sum to households or families. Designed to provide freedom and agency, individual payments are critical to the underlying principles of a Basic.
Paying a Basic Income to individuals will give people independence, providing all with a sense of control and autonomy. This is in contrast to current social security payments, such as Universal Credit, which paid to households.
Fundamentally, paying a Basic Income to individuals will give freedom and enable people to act in their own interest with control over their life, rather than being financially dependent on others.
Why not pay it to households?
Current social security payments such as Universal Credit are paid to households, but this can generate various problems – which a Basic Income will prevent. The major issue being inequality within households in terms of power, control over resources and freedom.
Whilst once upon a time the idea of a ‘household’ composing of a man, woman and kids was regarded as the norm, nowadays households take many shapes and sizes. As opposed to trying to encourage people to go back to this ‘traditional’ way, a Basic Income paid to individuals is compatible with modern life, providing the freedom and flexibility people need and want.
Universal Credit payments are paid to ‘the household’, but in reality they go to one person’s bank account – and this can often create issues. In short, you can quickly become financially dependent on another household member one member of the household (disproportionately women) are the second earners, don’t necessarily access Universal Credit payments and therefore are deprived of control over their own finances.
Another issue being due to Universal Credit, going to households, when collective household earnings move above a certain threshold, you lose access to these payments. Inevitably this discourages lower earners within the household from working as they will lose entitlements to welfare. With a Basic Income paid individually and unconditionally, there would be no reduction in payments if you or a household member starts to earn more.
Ultimately having your own income, and the control it brings inevitably stunts people’s freedom and can negatively impact mental health. More than this however, financial dependence is a facilitating factor for financial and domestic abuse, with dependence on an abuser hindering the ability to leave them. This isn’t caused by payments to households, but is something they fail to prevent and to some extent enable. Within the context of a labour market which sees women paid less, work less and undertake unpaid caring duties more, such policies also fail to tackle these inequalities and therefore simply reinforce them.
So why is a Basic Income paid to individuals better?
Outside the realm of work and leisure is the realm of care, an area our capitalist system does not value or compensate, but is completely reliant upon. The outdated ‘male breadwinner model’ is a byproduct of this, where men participate in paid work, enabled by women undertaking unpaid domestic work – becoming financially dependent on their partner.
Whilst this has changed over decades, the legacy remains and is visible in the unequal distribution of childcare and domestic work as well as gendered labour market inequality in terms of income and volume of paid work. Due to this continued inequality, payments to households which disincentivise secondary earners working risk reinforcing intra-household gender inequality. This can lead to situations where men undertake more paid-work, controlling funds whilst women undertake unpaid caring responsibilities and remain financially dependent.
A Basic Income given to all individuals will therefore challenge this inequality, and the problems created and enabled by payments made to households.
There are 4 major impacts the individual payment of a Basic Income will have:
- Financial & material – a Basic Income individually paid will give all people their own income, enabling them to improve their material living standards. Studies show having your own independent income is key to improving material standards.
- Autonomy & control – a Basic Income will give power, enabling control over household resources, rather than the major breadwinner controlling major monetary decisions.
- Psychological & wellbeing – the above effects will naturally improve mental wellbeing, and receiving payment for unpaid work such as care will also provide reward for important work.
- Rebalancing work – unlike Universal Credit, a Basic Income doesn’t push people into paid-work nor does it reduce payments if secondary earners work more. Individuals can choose to rebalance their paid & unpaid work within the household, challenging gender inequalities.
Ultimately, a Basic Income is a policy built for the 21st century and not the 1920s. It recognises the complexity of people’s lives and the diversity of families in 2020. Payments to individuals will therefore empower all people, providing them control, financial independence and a decent standard of living.
Luke Brotherdale Smith, Basic Income Network Scotland Volunteer