Thank you to those who have messaged me about supporting creative workers with a basic income guarantee.
I appreciate your concern that there are a lot of people who have been affected by the outbreak of Covid-19. Every step of the way, I know the Government has listened to the concerns of the population and actively provided support. To ensure that people have the correct level of support they need at this time, the standard rate of Universal Credit has been increased by £1,000 for the 12 months. This is an £86.67 increase per month, on top of the planned annual increase. New Claim Advances are also available online and by telephone for those who require money urgently, and the majority of these cases have received payments within 72 hours.
During the current pandemic, it is crucial that everyone, no matter what their field, is supported to the fullest possible extent. We must do whatever it takes to protect jobs and livelihoods across the UK, and we must adapt our support as the path of the virus changes. It is right that the Self-Employed Income Support Scheme has been adjusted to ensure parity with the CJRS. The SEISS grant rate for the November to January period will increase from 40 per cent to 80 per cent of average trading profits, up to a maximum of £7,500. Increasing our support for the self-employed will protect millions of jobs and give people and businesses the certainty they need over what will be a difficult winter
The Coronavirus Job Retention Scheme can be applicable to full-time employees, part-time employees, employees on agency contracts, and employees on flexible or zero-hour contracts. In October these grants covered 60 per cent of wages up to a cap of £1,875 for the hours the employee does not work. Employers paid ER NICs and pension contributions and 20 per cent of wages to make up 80 per cent total up to a cap of £2,500. It is clear the economic effects of fighting COVID-19 last longer for businesses than the duration of any given restrictions, and we need to go further with our support. I welcome that the Coronavirus Job Retention Scheme has been extended until the end of April in response to new national restrictions, and to give people and businesses across the whole United Kingdom the certainty they need over what will be a difficult winter. Under the extension the government will pay 80 per cent of wages up to a cap of £2,500, with employers paying employer National Insurance Contributions (NICs) and pension contributions only for the hours the employee does not work. Flexible furloughing will be allowed in addition to full-time furloughing.
I do, however, understand that every individual circumstance cannot necessarily be accounted for. In the event that you have been affected by the pandemic, yet you are ineligible for the aforementioned schemes, I urge you to apply for Universal Credit. The Chancellor increased Universal Credit by £1,000 a year for 12 months in order to support people through Covid-19.
Ideas of a universal basic income have, as I am sure you are aware, been subject to debate and discussion for some time. It is important that we have had this debate, and I hope that UBI-style systems continue to be subject to research and discussion, so that our approach to welfare can remain informed. The question of feasibility is one we should consider. No matter how desirable a UBI-style programme might be, it must also be feasible in the present context of our economy. When considering feasibility, we must address whether such a programme would be affordable, and whether it could be introduced in a manner that prevented losses amongst the most vulnerable in our society.
A report from Compass, a think-tank, and the Joseph Rowntree Foundation, found that UBI could be prohibitively expensive, could create too many losers among the poorest families, could dramatically increase the number of children living in poverty (as was also found in modelling by the Citizen’s Income Trust), and could dramatically increase inequality because it would not account for individual needs and circumstances. The report found that the additional tax revenue required to support such a system could be as much as £160 billion. Such a figure would indicate that UBI systems would be unaffordable, even when the effect on individual behaviours in the labour market are not considered.