Universal Basic Income is affordable and feasible: evidence from UK economic microsimulation modelling

Reed, Howard, Johnson, Matthew, Lansley, Stewart, Johnson, Elliott, Stark, Graham and Pickett, Kate E. (2023) Universal Basic Income is affordable and feasible: evidence from UK economic microsimulation modelling. Journal of Poverty and Social Justice, 31 (1). pp. 146-162. ISSN 1759-8273

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Official URL: https://doi.org/10.1332/175982721X16702368352393


Critics of Universal Basic Income (UBI) have claimed that it would be either unaffordable or inadequate. This discussion paper tests this claim by examining the distributional impacts of three UBI schemes broadly designed to provide pathways to attainment of the Minimum Income Standard (MIS). We use microsimulation of data from the Family Resources Survey to outline the static distributional impacts and costs of the schemes. Our key finding is that even the fiscally neutral starter scheme would reduce child poverty to the lowest level achieved since 1961 and achieve more than the anti-poverty interventions of the New Labour Governments from 2000. The more generous schemes would make further inroads into the UK’s high levels of poverty and inequality, but at greater cost. We conclude by assessing fiscal strategies to reduce the up-front deficit of higher schemes, providing a more positive assessment of affordability and impact than critics have assumed.

Item Type: Article
Additional Information: Funding information: This research was kindly funded by the Wellcome Trust as part of ‘Assessing the prospective impacts of Universal Basic Income on anxiety and depression among 14–24-year-olds’ (grant number 223553/Z/21/Z). For the purpose of open access, the author has applied a CC BY public copyright licence to any Author Accepted Manuscript version arising from this submission. Kate Pickett was supported by the UK Prevention Research Partnership (MR/ S037527/1) collaboration, ActEarly. UKPRP is funded by the British Heart Foundation, Cancer Research UK, Chief Scientist Office of the Scottish Government Health and Social Care Directorates, Engineering and Physical Sciences Research Council, Economic and Social Research Council, Health and Social Care Research and Development Division (Welsh Government), Medical Research Council, National Institute for Health Research, Natural Environment Research Council, Public Health Agency (Northern Ireland), The Health Foundation and Wellcome.
Uncontrolled Keywords: Universal Basic Income, microsimulation modelling, poverty, inequality, Minimum Income Standard
Subjects: L100 Economics
L400 Social Policy
Department: Faculties > Arts, Design and Social Sciences > Social Sciences
Depositing User: John Coen
Date Deposited: 06 Oct 2022 11:17
Last Modified: 17 Mar 2023 10:15
URI: https://nrl.northumbria.ac.uk/id/eprint/50303

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