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Asheem Singh is Director of Economics at the Royal Society of Arts, Manufactures of Commerce. He authored ‘The Moral Marketplace’ and is a former researcher to Boris Johnson.

In my last piece for ConHome I outlined four scenarios for the future of work over the next twenty or so years. I argued that in any of these scenarios, given the rapid pace of automation and the development of artificial intelligence and internet of things, as well as the increasing potential for force majeure events (‘exoduses’), we need to rethink the entire foundation of our benefits system, our employment support architecture, and the way in which we make cash transfers to an increasingly insecure workforce  – if we are to get ahead of the curve on the issues affecting today’s workers.

What I didn’t predict was that all this would come to be quite so quickly.

In this piece then, I want to consider three key proposals for rewiring the architecture of our safety net as we surf this crisis. At the RSA we’ve been gaming these scenarios for some time; it has been quite something to see them so rapidly enter the discourse. Still there is much to consider as we rebuild support for Britain’s workers.

Universal basic income

The ‘UBI’ conversation has moved on considerably in the last few days; it is conceivable we will be in a post-basic income world as early as next week. While Donald Trump toys with the idea of helicopter drop type payments – essentially printing money to give to people – the UK government is naturally inclined to lean on government borrowing to finance an unprecedented expansion of the welfare state.

It has been argued that UBI would require a whole new delivery mechanism. Not so. As Anthony Painter has argued, a doubling, say of statutory sick pay would mitigate the injustice of our being the second most miserly in Europe while offering a substantial cash payment. At the same time a complementary path of least resistance sees us increase income tax and national insurance allowances to £18,000 and pay a retrospective 3 month £1,500 payment to every worker. Then an additional £500 per month. Removing conditionality from Universal Credit completes the metamorphosis of these various entitlements into something like a UBI.

Those on Universal Credit could have it funnelled via PAYE. Gig workers could go one of two ways; they could file a claim for a cheque through self-assessment – or have their main income platform set them up on payroll (the latter I prefer though watch out for fraud and error; it will require some robust self-organisation by internet companies to avoid it).

Implementation is key here: the Universal Credit experience teaches us that. The modelling, the rationale behind UC was relatively sound but it all fell apart on delivery. Similarly one of the issues with loan guarantee schemes of the kind announced by the chancellor this week is that, while they are generally cost-effective and look happily bigger than they are, the money is often hard to get out the door without a huge engagement push (this was the experience in 2008). We can’t have these gremlins in the system this time; when it comes to much-needed cash that will save lives, there can be no slip ups.

Portable benefits

Speaking of self-organisation by internet companies: surely the time has come for ‘portable benefits’ to enhance the UBI approach – and operate as the second foundation on which the new welfare settlement rests. Gig workers especially should be able to rely upon entitlements and support that transcends their relationship with one platform or another.

Setting this up will require the sort of collaboration between government, platforms and unions that the Chancellor adumbrated in his reworked budget this week. The Nordics are ahead of us in this regard; there are nascent models (for example that trialled by Unionen in Sweden, of which I wrote previously) that offer the beginnings of a precedent.

Between UBI and portable benefits – allied to rent reliefs, bill and tax holidays included for the emergency period  – you have the beginnings of a reformed social contract that replaces the post war-settlement. Call it flexicurity.

Economic security – over and above poverty, inequality or GDP

How do we know we are doing a good job amidst all this? I agree with Ryan Bourne who wrote on these pages earlier this week: GDP for the foreseeable future, is bunk. We need to reduce demand in the economy; get people buying and consuming less, staying at home and staying healthy. It’s an incredible position in which to be: the negative growth economics of academics like Jason Hickel has gone absolutely mainstream. But there we are.

Will it be ever thus? Perhaps but it certainly makes sense to move to a new set of indicators for now. Alongside public health indicators, unemployment, change in income and business churn rates, I would add a fifth indicator: economic security.

Economic security is defined by the RSA as ‘the degree of confidence that a person has that they will have enough on which to survive, for now and the future.’ Measures of economic security are thus not only physical (e.g. how many months’ savings to I have) but also psychological (e.g. how secure do I feel). They do not only affect those in poverty but those across the income scale. We are currently working to develop just such a measure at the RSA, and have been encouraged by its utility in political and social science terms. Certainly, I contend, it has more heft than measures like ‘wellbeing’ – though I am picking a fight at this point I need not pick.

We are gaming several other policy ideas at the moment: I’d be delighted to hear more from ConHome readers about which they think should be considered.

The esteemed Editor of this site this week suggested that any changes we make will be here to stay. I think this is right: coronavirus will be seen as an acceleration of trends that were already long-predicted by economists and futurologists like myself (much as it pains me to strike that pose). Whatever new world we create from this, the likelihood is that it is here to stay.

28 comments for: Asheem Singh: Coming as a consequence of the virus. The new aim of Economic Security – over and above poverty, inequality or GDP.

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