Money problems: why Finland has given up on the basic income dream

When the Finnish government embarked on a trial of basic income it was lauded as bold, evidence-focused and innovative. The country became something of a standard bearer in a worldwide push towards basic income projects. In failing to commit to widening the scope of the trial in 2019 beyond its current group, however, that reputation is under threat.

Universal basic income (UBI) in its purest form is a payment that every citizen receives on a regular basis, without condition and as of right, in and out of work. Universal credit is paid on a household basis, is means tested and conditional, for example on recipients proving that they are actively searching for and accepting offers of work. The Finnish trial is not universal, as only 2,000 unemployed people were selected for it, but it is a basic income.

Developing an understanding of basic income is a marathon, not a sprint. As 2019 parliamentary elections approach in Finland, it would appear that boldness is being replaced by timidity and politics. We know from past experiments that basic income has significant merits. While basic income is in vogue now, it is not new. When the data from a 1970s trial in Dauphin in Canada was crunched, the positive impacts on health, education and wellbeing were clear. Research from 2018 on Alaska’s dividend scheme suggested that universal payments do not undermine work, as critics have claimed.

With economic security further under threat by technological changes, new sources of economic security could become necessary: UBI is one. Developing a fully implementable and affordable national UBI scheme will take time. It is one reason the Royal Society for the encouragement of Arts, Manufactures and Commerce has proposed a basic opportunity dividend of up to £10,000 a person in any given 10-year period to provide people with the security to make different choices in their lives. This would be a stepping stone towards UBI. But trials are essential, too – which is why it is encouraging that the Scottish government is looking at hosting some.

Hopefully, the next Finnish government will review the evidence when it comes to renewing or extending the basic income trial after the election – the world is watching.