Sunday 4 December 2016

Finland is considering giving every citizen €800 a month and scrapping benefits

Proposals for a national basic income are intended to simplify the social security system and encourage more unemployed people to take on temporary work

Published 07/12/2015 | 07:10

Helsinki
Helsinki

Authorities in Finland are considering giving every citizen a tax-free payout of €800 each month.

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Under proposals being draw up by the Finnish Social Insurance Institution (Kela), this national basic income would replace all other benefit payments, and would be paid to all adults regardless of whether or not they receive any other income.

Unemployment in Finland is currently at record levels, and the basic income is intended to encourage more people back to work. At present, many unemployed people would be worse off if they took on low-paid temporary jobs due to loss of welfare payments.

More than 10 per cent of Finland's workforce is currently unemployed, rising to 22.7 per cent among younger workers.

According to research commissioned by Kela, close to 69 per cent of the Finnish population favours the idea of a national basic income.

 Detractors caution that a basic income would remove people's incentive to work and lead to higher unemployment. Those in favour point to previous experiments where a basic income has been successfully trialed. The Canadian town of Dauphin experimented with a basic income guarantee in the 1970s and the results - both social and economic - were largely positive.

Finnish Prime Minister Juha Sipilä supports the idea, saying: “For me, a basic income means simplifying the social security system.”

The basic income will cost Finland roughly €46.7 billion per year if fully implemented. Kela's proposals are due to be submitted in November 2016.

 The Dutch city of Utrecht is also planning to introduce a basic income, albeit solely for welfare recipients. From next month more than 250 unemployed residents of the city will be given a monthly sum to live on, with researchers monitoring the outcome to determine what effect it has on employment.

Switzerland is also considering introducing a national basic income. In September the Swiss parliament voted, with a large majority, for a motion calling on the Swiss people to reject the Popular Initiative for Unconditional Basic Income. However, a nationwide referendum on the issue is slated for 2016 and, according to a recent online poll, 49% of the Swiss would currently vote in favour of its introduction.

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