Dutch city plans to pay citizens a ‘basic income’, and Greens say it could work in the UK

Utrecht takes step towards paying people a salary whether they work or not

The Guardian, Daniel Boffey in Utrecht, 26 December 2015

The cafes and restaurants alongside the Oudegracht (Old Canal) in central
Utrecht. Photograph: Alamy

It’s an idea whose adherents over the centuries have ranged from socialists to libertarians to far-right mavericks. It was first proposed by Thomas Paine in his 1797 pamphlet, Agrarian Justice, as a system in which at the “age of majority” everyone would receive an equal capital grant, a “basic income” handed over by the state to each and all, no questions asked, to do with what they wanted.

It might be thought that, in these austere times, no idea could be more politically toxic: literally, a policy of the state handing over something for nothing. But in Utrecht, one of the largest cities in the Netherlands, and 19 other Dutch municipalities, a tentative step towards realising the dream of many a marginal and disappointed political theorist is being made.

The politicians, well aware of a possible backlash, are rather shy of admitting it. “We had to delete mention of basic income from all the documents to get the policy signed off by the council,” confided Lisa Westerveld, a Green councillor for the city of Nijmegen, near the Dutch-German border.

“We don’t call it a basic income in Utrecht because people have an idea about it – that it is just free money and people will sit at home and watch TV,” said Heleen de Boer, a Green councillor in that city, which is half an hour south of Amsterdam.

Nevertheless, the municipalities are, in the words of de Boer, taking a “small step” towards a basic income for all by allowing small groups of benefit claimants to be paid £660 a month – and keep any earnings they make from work on top of that. Their monthly pay will not be means-tested. They will instead have the security of that cash every month, and the option to decide whether they want to add to that by finding work. The outcomes will be analysed by eminent economist Loek Groot, a professor at the University of Utrecht.

A start date for the scheme has yet to be settled – and only benefit claimants involved in the pilots will receive the cash – but there is no doubting the radical intent. The motivation behind the experiment in Utrecht, according to Nienke Horst, a senior policy adviser to the municipality’s Liberal Democrat leadership, is for claimants to avoid the “poverty trap” – the fact that if they earn, they will lose benefits, and potentially be worse off.

The idea also hopes to target “revolving door clients” – those who are forced into jobs by the system but repeatedly walk out of them. If given a basic income, the thinking goes, these people might find the time and space to look for long-term employment that suits them.

But the logic of basic income, according to people to the left of Horst, leads only one way – to the cash sum becoming a universal right. It would be unthinkable for those on benefits to be earning and receiving more than their counterparts off benefits. Horst admitted: “Some municipalities are very into the basic income thing.”

Indeed leftwing councillors in Utrecht believe this is an opportunity to prove to a sceptical public that people don’t just shirk and watch television if they are given a leg-up. “I think we need to have trust in people,” said de Boer.

Caroline Lucas, the Green party’s only MP in the House of Commons, agrees. A basic income – the Greens call it a “citizen’s wage” – has long been party policy. It did not make the cut for their manifesto because they couldn’t find a way to fund it.

But developments in the Netherlands, and a parallel pilot in Finland, have bolstered Lucas’s belief that this idea’s time has come. The Royal Society of Arts has been examining the feasibility of the idea, as has campaign group Compass.

To those who say it is an unaffordable pipedream, Westerveld points out the huge costs that come with the increasinglytough benefits regimes being set up by western states, including policies that make people do community service to justify their handouts. “In Nijmegen we get £88m to give to people on welfare,” Westerveld said, “but it costs £15m a year for the civil servants running the bureaucracy of the current system. We will save money with a ‘basic income’.”

Horst adds: “If you receive benefits from the government [in Holland] now you have to do something in return. But most municipalities don’t have the people to manage that. We have 10,000 unemployed people in Utrecht, but if they all have to do something in return for welfare we just don’t have the people to see to that. It costs too much.”

Lucas says she will seek a parliamentary debate on the policy in the new year, and will ask the government to look into the feasibility of a “basic income” pilot here. “I think in Britain people have quite a puritanical idea of work,” she said. “But this is an urgently needed policy. With increased job insecurity, the idea of everyone working nine to five is outdated. People go in and out of work these days.” “People are increasingly working in what they call the gig economy. The current system is not fit for purpose.”

The idea faces a tough political headwind, of course, not least in the Netherlands. Last Tuesday, Johanna von Schaik-Vijfschaft, 41, could be found updating her CV on one of the computers made available to benefits claimants at the Utrecht council building. A cleaner at a local department store, she had been told by council officials to find more work than the 12 hours she currently does.

But she will be under even more pressure in a few years when her 19-year-old son turns 21 and leaves her care. Once she has no dependants, she will lose £150 of her £500 monthly benefit payment and come under the remit of the participation laws, legislation recently brought in by the rightwing central government to make benefits claimants work harder for their cash. Von Schaik-Vijfschaft could be ordered to do some community work for the council in return for her benefits, and will face the threat of losing more of her income if her application rate for jobs falls away. And if Von Schaik-Vijfschaft were to dress inappropriately for interviews or, worse still, miss an appointment, she will lose all her benefits for a month.

The country’s second city, Rotterdam, has even trialled a “work first” system, where aspiring benefits claimants must put on an orange jacket and spend two months clearing rubbish before they are handed any payments.

“Rules, always the rules,” von Schaik-Vijfschaft said. “But of course I want to work. I want to be busy – we all do.” If the experiment can prove that, maybe Tom Paine’s idea will have its day yet.

HOW IT WORKS

■ A “basic income”, first proposed by Thomas Paine is an income unconditionally granted to all on an individual basis, without any means test or requirement to work.

■ It is paid irrespective of any income from other sources.

■ It is paid without requiring the performance of any work or the willingness to accept a job.

■ Advocates say it will allow people to genuinely choose what sort of employment they take, and to retrain when they wish.

■ Its proponents also claim that a basic income scheme is one of the most simple benefits models, and will reduce all the bureaucracy surrounding the welfare state, making it less complex and much cheaper to administer.

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