Low-condition transfers instead of an unconditional basic income

The idea of an unconditional basic income has gained additional momentum since the outbreak of the corona pandemic. There are good reasons for this: the pandemic will probably lead to technological change penetrating our society more quickly and changing it. Uncertainties about job losses, for example, are increasing. In addition, the pandemic has once again highlighted how different people’s circumstances are and how conventional social systems can reach their limits. It is very possible that various forms of basic income will become a reality more often than was thought before the pandemic – especially in Anglo-Saxon countries where welfare systems are less developed. Completely unconditional basic incomes, as are often discussed, are still unlikely, however, and probably also not expedient. Instead, variants of low condition transfers as, for instance, payments linked to minimum conditions, are likely to be increasingly introduced.

Since the outbreak of the corona pandemic, low-condition transfer payments have been decided in various countries in order to be able to distribute funds to people quickly and without bureaucracy. The best-known example is the total of 3200 US dollars that individuals with low or medium incomes have received in three tranches since March 2020. Low-condition transfer payments are similar to an unconditional basic income, but are subject to some conditions – such as the amount of income – and are usually insufficient to cover living expenses. Several developments suggest that unconditional transfer payments may continue to play a more important role in the future than was recently thought. The pandemic is currently acting as a kind of catalyst, accelerating technological and social change – such as work from home, digital education or forms of telemedicine. In the future, hybrid forms of services that combine elements of face-to-face and digital exchanges are likely to remain even more so than before the pandemic.

These developments mean that job profiles are changing and many people understandably struggle to adapt to rapidly changing requirements. In addition, more office jobs are at risk from automation or relocation abroad. Work from home, for example, has many positive aspects in terms of flexibility. At the same time, however, some companies may be tempted to have the same work done more cheaply from another country. In addition, robots or artificial intelligence could take more and more work away from people and cause high unemployment among some population groups. It is undisputed that structural change of the kind we are currently experiencing always represents a major challenge for the labor market and the welfare state. Existing knowledge and skills acquired in the past may be rapidly devalued. It is true that, as with past technological changes, many new jobs will be created to compensate for the loss of other jobs. But the situation is very stressful for people who lose their jobs and may not have the appropriate training for new jobs. At least temporarily, unemployment may increase and social tensions may arise in society.

In addition, flexible forms of employment such as on-call work and project-based work are on the rise. For these forms of employment, however, social security is often worse than for permanent employees. This is clearly evident in the current crisis, in which jobs have suddenly disappeared for many. Another important issue that is likely to promote low-condition transfers is the individualization of life circumstances. There is increasing variation in how people take career breaks or work part-time to do unpaid work in the form of childcare or caring for relatives, for example. Current social security systems do not take this into account in an adequate way.

Uncertainties and individualization are on the rise, and people are likely to increasingly call for new forms of social security. It is unlikely that countries will introduce comprehensive and living wage forms of basic income. A rapid and radical transformation of social security systems would be too complex and risky. Ambitious ideas for an unconditional basic income – such as the popular initiative in Switzerland – have repeatedly failed because they would have led to drastic changes in the welfare state and society that were difficult for people to assess. In particular, questions of financing and incentives to work were not clear. It is likely, however, that more and more forms of low-condition transfers will emerge. For example, low-condition financial support for continuing education may become more popular because, in a world with uncertain futures and employment prospects, educational investments are associated with high uncertainty and existing skills may rapidly lose their value.

Whether an expansion of such low-condition time-out incomes, an unconditional basic income, or simply a slight modification of existing systems is the better solution depends largely on how technological change will affect our lives and work in the coming years and how our societies respond to it. It is the task of science and society to increasingly experiment with different types of a basic income or low-condition transfers. This will provide our societies with more experience and facts to make decisions about the future of work and social security systems.

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