Universal Basic Income: Sheffield is Largest U.K. City Yet to Support Trial

The policy is picking up steam.

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Filed Under Money & Work

Sheffield could become the first English town to trial a universal basic income. The council for the 500,000-strong northern city approved a motion Wednesday to support the policy, which campaigners believe could help mitigate the worst effects of an increasingly-automated workplace powered by artificial intelligence.

“This motion of support from Sheffield City Council is an enormous vote of confidence in our proposal for a UBI pilot in Sheffield,” Sam Gregory, a member of the UBI Lab Sheffield campaign supporting a trial in the city, tells Inverse. “With automation claiming an ever-increasing number of jobs, it’s inevitable that this plan to give everyone a guaranteed standard of living will be trialed in the U.K.”

Sheffield is all-too-familiar with workers getting left behind: it was formerly known as the steel capital of the world, but has suffered from low wages in the wake of 1970s deindustrialization. The city’s residents narrowly voted in favor of Brexit — withdrawing from the European Union — three years ago.

Basic income, which would give everyone a fixed monthly sum, could help. A trial in Finland showed that people felt more secure on the same amount of money, while another in Ontario found that people could afford healthier food. Andrew Yang, who is running for the Democratic nomination for the American presidency, claims his $1,000-per-month payout could protect against job losses from automation.

“As automation plays a bigger and bigger role in the workplace this will inevitably lead to huge changes, and in order to face up to these realities I think it is completely right that radical solutions are considered,” Julie Dore, the council leader and a member of the Labour Party, said in a statement. Dore went on to commend the UBI Lab Sheffield group “for all the work they have done to push Sheffield to the forefront of the national debate on this issue.”

The campaign group has three ideas for how such a policy could work, outlined in a letter to all 84 councilors in May.

  • The first is to remove conditionality from a set of employment-linked disability benefits. This plan would cost £18 million ($23.6 million) and ensure 8,000 ill or disabled people could receive money regardless of their finances or work status
  • Another, costing £23 million ($30.2 million), would give a taxable payment of £130 ($169) per month to 4,000 adults in a single community.
  • A third, costing £60 million ($78.8 million), would replace the tax and benefits system with a £6,000 ($7,838) per year payout to all in a community. Disabled and retirement-age people would receive more, and children would receive less. A new income tax would ensure those earning £25,000 ($32,600) or under per year would gain overall.

Sheffield’s Basic Income Trial: What Happens Next

The motion does not mean that Sheffield will now get to trial a basic income. The United Kingdom has the most centralized government of the G7 group of countries, with the Institute of Economic Affairs noting that just five percent of revenue is raised locally. That means decisions like these still need a thumbs-up from the British Parliament.

Fortunately for the campaigners, the balance of power could soon shift there as well. John McDonnell, finance spokesperson (or “shadow chancellor”) for the Labour Party, revealed in May that he would aim to trial the policy in three areas if his party won power. The next election is scheduled for 2022, but Brexit turmoil could spark a poll as early as this year.

“The reason we’re doing it is because the social security system has collapsed,” McDonnell told The Mirror, referring to the near-decade-long austerity program that has attracted criticism from a United Nations envoy. “We need a radical alternative and we’re going to examine that.”

Support from the council and the shadow chancellor is a big win for the campaigning group, but Gregory stresses that the work is not over yet. The campaign will now focus on getting support for the idea from the two universities, local members of the National Health Service, and other community stakeholders.

“That is what UBI Lab Sheffield will now be focusing on,” Gregory says. “We would also like to start a city-wide conversation about basic income, and the transformative effect it could have on the lives of everyone in Sheffield.”

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