Across Europe the great cogs of policy making are turning. As the challenges of automation and the gig economy loom large, politicians, economists and policy makers are struggling to produce viable solutions. One particular social policy, however, has gained significant traction in recent months: a Universal Basic Income. UBI has pockets of support across the political spectrum, from hard leftists who see it as a road to significant worker empowerment, to hard right libertarians who see it as a way to cut back much of the paternalistic functions of the state.
The arguments by proponents and opposition are, however, almost always offered in the economist’s context. What is not often discussed is the context of public health. It is well known that financial insecurity and disempowerment in the workplace cause significant health detriments, so it might seem plausible to suggest that a UBI could improve public health. This may even offset some of the cost of implementing such a policy. But what does the existing evidence say? And, given the broad spectrum of support for it in Europe, would a UBI produced by the current political structures even produce these health benefits at all?
UBI is not a new idea. It has its roots in texts as old as Thomas More’s Utopia from the 16th century, where guaranteeing subsistence to everyone was purported as a possible solution to thievery. The idea of a basic income can be seen in John Stuart Mill’s Principle of Political Economy as early as the mid-19th century. There were even several large scale trials in the USA and Canada during the 1970s as political momentum for it grew and then dissipated as it failed to pass into legislature.
The UBI renaissance
Re-popularisation of the idea recently is probably due to the increasing pressure on welfare states cut to the bone, combined with growing fears of a huge wave of automation predicted to cut large swathes of jobs from the economies of European countries. People want to make sure welfare states are sustainable for uncertain times ahead.
Whilst the economic sustainability of a UBI is obviously important, the subject is overrepresented in European media. Due to the largely theoretical stage of discussions around UBI, and perhaps the lack of literature, the health impacts are little discussed. There are some key bits of evidence that should be brought to public attention.
The most generalisable and reliable study to date on the subject was conducted on data from the MINCOME scheme; a program of guaranteed minimum income provided to randomly selected residents of Manitoba, Canada, with a saturation site in a small town called Dauphin. At the saturation site, all residents of the town were eligible for the minimum income scheme, making it the closest thing to a real completed* trial of UBI in a developed nation.
It is important that this scheme included a saturation site for two reasons. Firstly it allowed the public health scientists who published the paper on the health impacts of MINCOME to use retrospective aggregate hospital data from Dauphin (data not useful unless a large proportion of people using the hospital were eligible for MINCOME). Secondly, it may have allowed the theorised multiplier effects of a UBI to manifest- the increased sense of community, the improved collective bargaining power of employees etc.
What this study showed was a general improvement in health of the Dauphin population; a significant decrease in admittances to hospital (specifically for accidents and injury and mental health) was seen, alongside increased school attendance; an important social determinant of health.
Another study, also conducted in Canada, used the guaranteed income of the countries state pension as a UBI analogue. It compared low income seniors who were eligible based on age and those who were not, many of whom will have been claiming means tested benefits of similar monetary value to the pension. The findings were remarkable: the seniors in the pension eligible group were found to have better mental and physical health, despite being on average 10 years older, at an age where such a difference means drastic increases in morbidity factors and mental health issues such as dementia. It is obviously hard to draw causative conclusions, but it seems that the unconditionality of the pension scheme has tangible health benefits.
Limitations of conducted studies
These studies and the literature as a whole is, unfortunately, limited in its application to predicting the health outcomes of a UBI policy enacted in Europe, but what is out there seems positive. It is therefore reasonable to suggest that some of the costs of a UBI would be offset by the health benefits. But beyond the economic sustainability of UBI, health gains are obviously a good thing, not to mention the myriad other possible benefits of such a policy that are beyond the scope of this article. Ongoing and proposed studies in Finland, Canada, Scotland and the Netherlands will help to crystallise the possible effects of UBI and will certainly be ones to watch.
However, there is a serious caveat to all this positivity, and it is indicated by the broad range of support for UBI; as alluded to before, proponents on the right see it as a vehicle to strip back the welfare state. Whilst this would give efficiency bonuses as a replacement for means tested benefits like unemployment allowance, removing things like disability benefits could be disastrous for the health of people across Europe. Furthermore, some proponents on the right wish to offer UBI as only a partial income, meaning people would still need to work to survive, reducing the possible health benefits. Given the surge in far right populism in Europe, most recently demonstrated in the Italian election, it may therefore be unwise to push a UBI in the present political climate.
*Whilst technically untrue as the funding for the program was discontinued before the end, merely refers to the fact that many other trials of a true UBI remain ongoing in modern day Netherlands and Finland for instance.
Crédit photo: Markos Loizou