Scotland’s independent think tank
Scotland’s independent think tank

Basic Income Guarantee: a 21st Century Scottish Welfare System? – Siobhan Mathers

In recent years, Scotland has been much pre-occupied with constitutional matters. You’d have had to live in a cave to avoid the reflection and debate on who and what we are as a nation and whether we should be an independent country or remain part of the UK. The best of this debate has examined what sort of country we want to be and yet here we are weeks away from a Holyrood election, which will decide spending priorities for the next 5 years with significant new powers on their way, and little talk about how we would actually do things differently. Even with new powers, the response from political Scotland seems to be ‘steady as she goes’.

Welfare policy is an area ripe for a rethink. UK Welfare policy is: overly complex; arguably unfair and unhelpful to many who need it; and doesn’t seem to deliver great value for the tax-payer. I think a welfare system should provide a safety net in times of need, but encourage those who can work to do so. The ridiculous complexities of the current system often make it difficult to take on part-time or temporary work.

So what could a Scottish welfare policy look like?  The new Basic Income Guarantee report, which I co-authored along with James Mackenzie and Reform Scotland, aims to reshape the debate. This is something genuinely radical we could do to send a message to our citizens and the rest of the world that Scottish society is different and we’re not afraid to collectively be bold and radical to create a better Scotland.

The idea of a guaranteed income for all has got a fair bit of attention recently both in the UK and abroad. Fianna Fail have made it a key plank of their manifesto in the imminent Irish election. Once the natural governing party of Ireland, they have struggled in recent years. But this has helped to put them back at the centre of political debate with the claim that a basic income could play a key part in eradicating poverty in Ireland.

The Finns have mooted a scheme and there is also considerable interest in Canada and the Netherlands. In the UK there has recently been a spark of interest in the idea, but with most ruling it out as unrealistic.

In Scotland, however, we could have the opportunity to design a welfare system with a blank sheet of paper, whether in an independent Scotland or as part of the UK. What would that look like? How could it be better at dealing with changes in working patterns and lifestyles? How would it affect students and young people struggling to get a foot on the career ladder? How would it deal with a shift towards the ‘gig economy’ often entailing a mix of part-time /temporary jobs? How could it help older people transition from a full time job to temporary or part-time jobs to allow more leisure time/looking after grandchildren/dealing with health issues? How could it help parents to equitably juggle child-care and work?

The beauty of the Basic Income Guarantee to me is that every man, woman and child is entitled to it (we use the example of £100 per week for each adult and £50 per child) whatever they do and what they earn. It is a security and an absolute. And every pound earned on top of it is worth it. No more ridiculous complexities meaning that it sometimes isn’t worth taking on certain jobs. It could also allow for a more flexible labour force which could particularly benefit Scotland’s Small and Medium Sized Enterprises.

The scheme we have proposed is demonstrative rather than definitive, an opening gambit in the debate about a new welfare system for Scotland. Yes some would pay more tax; disruptive change always has consequences. But after the heat and light of the referendum debate, do we really want to settle for tweaking at the edges an outmoded UK welfare system? Or do we want to create a welfare system which could be the envy of the world in responding to changing economic realities while supporting our citizens and encouraging a dynamic economy?


Siobhan Mathers is a member of Reform Scotland’s Advisory Board and co-author of our report, The Basic Income Guarantee.