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Universal Basic Income would cut poverty in half in Cymru, new report reveals

Poverty in Cymru would be halved if Welsh Government commits to a progressive Universal Basic Income (UBI), according to a major study commissioned by the Future Generations Commissioner for Wales, Sophie Howe.

The feasibility study, run by leading think tank Autonomy, finds a UBI would decrease overall poverty rates in Cymru by 50% and child poverty would decrease by 64%, bringing it to a rate of under 10% in Cymru. It is currently at 28% – the worst in the UK.

It also found that nearly more than three quarters of people in Cymru, 69%, support piloting a UBI – which has been described as ‘this generation’s NHS’. 

Universal Basic Income is a government programme where every citizen receives a set amount of money on a regular basis, regardless of their employment status. It is a basic, minimum payment, designed to meet basic needs, paid to everyone individually, without condition.  

According to the World Health Organisation, poverty is the single largest determinant of health, and ill health is an obstacle to social and economic development. This means poorer people live shorter lives and have poorer health than affluent people.  

Earlier this year, Welsh Government announced its ambition to pilot a UBI pilot in Cymru. UBI Lab Wales, the Future Generations Commissioner and over 1,000 petitioners have called on the First Minister to ensure the pilot includes children, the employed, the unemployed and pensioners, as well as care leavers in a demographically representative pilot.

Ms Howe, whose role is to protect the interests of future generations under Cymru’s Well-being of Future Generations Act, will today (Monday 29th) give evidence to the Welsh Parliament’s Petitions Committee calling on Welsh Government to pilot a geographically-based Universal Basic Income (UBI) scheme that includes children, the employed, the unemployed and pensioners, as well as care leavers. 

A trial in Cymru of 2,500 people, the report finds, could cost around £50m, with adults being paid from £60 per week. 

A pilot in Finland found participants were happier, had greater trust in others and higher levels of confidence in the future. They also worked slightly more than those on unemployment benefits and reported better cognitive functioning.  

Those who were already living in poor health, poverty or in marginalised communities have been the hardest hit by the pandemic. It has highlighted the inequalities we knew existed in our society long before the pandemic arose – and these have been further compounded as a result of both the direct and indirect harms from the pandemic. Rising living costs, combined with the end of the Coronavirus Job Retention scheme (furlough) in addition to cuts to welfare benefits like universal credit amount to a “perfect storm” or “tsunami”, according to respondents to a Senedd Committee inquiry into debt and the pandemic.

Ms Howe said UBI could form part of a preventative-based National Wellness System, addressing income security – one of the social determinants of health – taking pressure off the health service and removing the barriers to long-term good health.

Sophie Howe, Future Generations Commissioner for Wales, said:  “The introduction of a universal basic income could completely transform society by delivering a more equal, prosperous Wales.

“Piloting a UBI trial here in Wales gives us a chance to increase the prosperity of every single person, giving more people a life jacket when they need to keep their head above the water – which has the potential to create a healthier, more equal population.” 

“The Well-being of Future Generations Act puts a duty on Welsh Government to take bold decisions to change systems that aren’t working and to prevent crises from worsening.

“The findings in this report should excite leaders who say they want a true green and just recovery that makes life fairer for everyone.”

Will Stronge, co-director of Autonomy, said:  “There is a strong appetite amongst the Welsh public for trying out basic income and this comprehensive study sets out the roadmap for getting there.   “The COVID-19 pandemic necessitates radical and bold changes to support people through future economic shocks. As the economy and labour market struggles to find its feet, it’s clear that guaranteeing an income floor for all is the most progressive way of securing livelihoods.”

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