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Unconditional triumph

The French/Belgian/Swiss pop-up basic income newspaper–journal-sur-le-revenu-de-base-155/index.html has achieved its funding target and is all set to publish 60,000 copies of a 20-page newspaper during the Basic Income Week in Europe.

Using a French crowd-funding website, Pick&Boost, the organisers of the paper had hoped to raise between 5,000 euros and 12,000 euros, and closed the appeal on September 4 when the total reached 12,030 euros ($A16,960).

The paper will be distributed in French-speaking countries in the European Union during the Seventh International Basic Income Week, between September 15 and September 21.

It’s not all about tax

Who do so many people assume that the only way to pay for a guaranteed basic income for all is by having a flat rate of income tax, pitched at an unacceptably high level?

For example, when the New Zealand Treasury was asked to model a basic income guarantee for Kiwis in 2010, it calculated that it would need a flat rate income tax rate of over 50 per cent to cover the cost.

The tax and welfare systems are two sides of the same coin.

Reforming welfare without reforming the income tax system at the same time makes no sense.

Simplifying the tax system means getting rid of all the various income tax offsets, deductions and allowances, but it does not require scrapping the “progressive” nature of the existing system.

The system of income tax taking an increasing percentage of each additional dollar earned has long been accepted and seen as essentially fair – those who can most afford to pay, pay the most.

There is no reason why there should not be many more smaller tax bands.   Why not a hundred tax bands, of say, $5,000 or $10,000?

You could charge the first $5,000 earned over and above the basic income at, say, two per cent. That would only be $100, leaving an after-tax income of $4,900.

If the marginal tax rate increased by another two percentage points for every $5,000 of income, someone earning between $5,000 and $10,000 would pay 4 per cent on their extra income. Someone on the average adult full time earnings of just over $80,000 would pay 32¢ for every extra dollar.

That looks very similar to the current rates, where you pay 37¢ for every dollar of taxable income” over $80,000.

Taxable income, of course, is income after various deductions, allowances, credits and offsets have been taken into account, so in practice you can earn considerably more than $80,000 before you hit the 37¢ rate.

However, under the current system, even if your taxable income is as little as $5 a year, you will pay a third of that income in tax (well, 32.5¢ in the dollar to be precise).

What that means is that with a guaranteed basic income incorporated into a simplified income tax system, those earning a below-average income would pay less tax than they do now, those earning above that level would pay more.

That’s the price they would pay for the security of a guaranteed minimum income and the economic and social benefits it would bring.

It wouldn’t cover the total cost of the scheme, but then, it doesn’t have to.  There are a range of savings and sources of revenue never closely examined in reports such as that produced by the NZ Treasury.

Key lobby group moves towards Basic Income

The Australian Council of Social Service,  the nation’s peak body representing the community services and welfare sector, has taken what is in effect a big step towards advocating a basic income.

In a submission to the current government review of the welfare system, ACOSS urges the government to “remove the distinction between pensions, allowances and student payments, and replace them with a common income support payment level that is adequate to cover the cost of life’s essentials.”

ACOSS is not advocating a “pure” basic income. It suggests supplementing the standard income support payment with top-ups for people with extra costs, including the costs of disability, the costs of care and the extra costs of caring for a child alone.  This would mean that hundreds of thousands of people would still have to be individually assessed by the state on a regular basis to determine how much income support they would receive.  That is something a universal basic income would avoid.

However the ACOSS standing income support system would be a good interim step on the road to basic income. It would be vastly simpler than the present system where there are “allowances”, “pensions” and “student payments”.

(In the jargon, an allowance is essentially a minimum amount of money grudgingly paid to unemployed people the government considers capable of work, even if no work is available and a pension is paid to people who are judged to be too old or disabled to work.)

It contrasts sharply with the interim report of the government’s review, which is proposing to make everything even more complicated by introducing a fourth category, between allowances and pensions, for those assessed as having limited “work capacity”.

ACOSS also proposes that “an independent expert commission be appointed by the Government to recommend benchmarks for the adequacy of income support payments.”  Although ACOSS does not say so, the establishment of such a commission would be an essential first step in moving to a full basic income system.

The ACOSS submission is well worth a read.  Clearly, soberly written over 78 pages (plus attachments on the real figures).  It is a polite but damning condemnation of the current system.

A Basic “university”

Next month will see what is billed as the world’s first “Basic Income University” which will run for three days in a small town in the south-west of France.
“Summer school” might be a better title, but whatever you call it, it is another reflection of the growing interest in the basic income movement in Europe.
Organised by the French Movement for a Basic Income (Mouvement Français pour un Revenu de Base), participation is free and open to all, including families and children.
The program includes 19 workshops, ranging from discovering Basic Income to ways of responding to common objections to Basic Income.
Eight plenary sessions will cover everything from politicians’ attitudes and womens’ lib to the abolition of poverty, and Basic Income’s impact on lifestyle.
A film program lists nine screenings, including not only documentaries on the Basic Income theme, but also Jean-Marc Moutout’s 2004 comedy/drama “Violences des échanges en milieu tempéré” (“Work hard, play hard”) and Charlie Chaplin’s “Modern Times”.
The “university” will be held from August 21 to 23rd, at the Lycée Agricole La Peyrouse in Coulounieix-Chamiers, on the outskirts of Périgueux.

Basic income uni logo

Australian Basic Income site

Cents and Sensibility does not have footnotes, bibliography or links to other sources.

That’s deliberate — the book is designed to be a quick and easy read to stimulate popular debate on  a currently hot topic.   It is intended to be a starting point, not an academic work.

More thorough, detailed academic discussion of Basic Income (or Basic Income Guarantee) has of course been available for years in Australia, thanks to the University of Queensland.

Anyone who wants to delve into the topic further may want to look at the university’s BIGA website:

A good start may be:

Good question, Minister

“Could we have four, five, six (welfare) payments rather than the dozens we’ve got at the present time?”

The question was posed by the Social Services Minister, Kevin Andrews, at the national conference of the Australian Council of Social Service (ACOSS) in Brisbane in June.

Of course we could, Minister.  A Basic Income system has just one.   Another book on how it could apply in Australia has just been published:

on iTunes:
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on Amazon:
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on Kobo at:

and on Google Play at:

The fact that the government wants to simplify the system is surely a step in the right direction.  It has asked its independent review of the welfare system to come up with “understood, reasonable principles but constructed in a simple way.”

What the government considers to be “reasonable principles” will be the crux of the matter. Don’t be surprised if the Number One “reasonable” Principle is that the welfare system should be designed to force everyone to work, regardless of who they are, where they are, how old they are or whether or not there is any work to be had.

Another will surely be that the system has to cost less than it does already.

One can only hope that the welfare review headed by the former head of Mission Australia, Patrick McClure, started with the basic question: Why do we have a welfare system at all?