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Friday, August 21, 2020

August 21, 2020

Researchers in Germany will give a group of people just over £1,000 a month, no strings attached, as part of an experiment to assess the potential benefits of introducing a wider universal basic income (UBI).

The radical idea has attracted a growing amount of interest around the world as a way of potentially supporting people during the coronavirus pandemic and beyond.

Advocates claim a small, regular income from the state to all citizens would help tackle poverty, encourage more flexible working practices, and allow some people to spend more time caring for older family members.

The German pilot study will initially see 120 people handed the monthly sum of 1,200 Euros (£1,085) to monitor how it changes their work patterns and leisure time.

Researcher Jurgen Schupp – who is leading the ‘My Basic Income’ project at the Berlin-based German Institute for Economic Research – said he wanted to discover how a “reliable, unconditional flow of money affects people’s attitudes and behaviour”.

Mr Schupp told Der Spiegel newspaper: “So far, the debate about the basic income has been like a philosophical salon at best and a war of faith at worst. It is, on both sides, shaped by clichés.

“Opponents claim that with a basic income people would stop working in order to lie on the couch with fast food and streaming services,” he added.

“Proponents argue that people will continue to do fulfilling work, become more creative and charitable, and save democracy. We can improve this [debate] if we replace these stereotypes with empirically proven knowledge.”

The 120 beneficiaries of the stipend will be studied, initially, against a comparison group of 1,380 people who do not receive any cash payments.

However, the academics behind the study want to find 1 million applicants for wider participation by this November. From that group, 1,500 people will then be selected for the three-year income experiment.

Pollsters at YouGov found that a majority of the British public support giving people UBI during the coronavirus pandemic to ensure their financial security.

Despite fears UBI would make people lazy, one major study discovered it has a small but positive effect on whether participants take up jobs as well as boosting mental well-being.

The two-year pilot, commissioned by the government of Finland, saw 2,000 people chosen at random from among the unemployed population paid a regular monthly income of 560 euros (£490) by the state for two years.

“Survey respondents who received a basic income described their wellbeing more positively than respondents in the control group,” the study’s authors at the Social Insurance Institution of Finland said.

Following the release of the pilot study in May, Scotland’s first minister Nicola Sturgeon suggested she was enthusiastic about the idea. “The expcerience of the virus and the economic consequences of that have actually made me much, much more strongly of the view that it is an idea that’s time has come.”

In June, Spain introduced a “minimum living income” to support citizens during the pandemic. It is a non-contributory cash benefit – one not attached to previous employment history – but only people below a certain income threshold are eligible.

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