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Moving away from paternalism

By John Tomlinson - posted Friday, 14 March 2008


There is a better way and that way is the provision of a Basic Income. A Basic Income would be paid to every permanent resident of Australia, as an individual, whether they live alone or with others, irrespective of their wealth or lack of it. It would be paid to those who engage in paid work as well as to those who are not remunerated for their labour.

A Basic Income is affordable. Australia is an affluent country which could easily afford to introduce a Basic Income paid to every permanent resident at a rate slightly above the age pension for single pensioners. An amount of $500 per annum above the age pension rate would be needed to cash out the tax deductibility concession currently provided to age pensioners who have additional income, if they are not to lose in the transition to a Basic Income. A Basic Income at this level would ensure that no current social security pensioner or beneficiary would be disadvantaged by the shift to a Basic Income while most low income earners would be financially advantaged.

Perhaps the clearest and most succinct refutation of the suggestion that Basic Income is unaffordable is put forward by Jose Iglesias Fernandez (2002). He argues for a Basic Income for Catalonia at a rate of half the per capita income of this region of Spain. He says that since the wealth needed already exists, the question is not affordability but willingness to redistribute that income. The proposal suggested here for Australia is a Basic Income of approximately 25 per cent of average weekly earnings which would involve considerably less redistribution than that suggested for Catalonia.

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The existing system of social security is inadequate, unjust and maintains people in poverty. It is clumsy, difficult to administer, hard to understand, discriminates against people with partners, poorly assists people with disabilities and has survived at least 50 years too long.

Australia needs to move to a socially just, easily understandable Basic Income which would sustain people above the poverty line if they cannot gain other income and help low income workers to escape poverty altogether. It could free people to become more productive. The economy would expand because a Basic Income would free up entrepreneurial imagining, make it easier for mature workers to gain further training, provide opportunities for workers to engage in new occupations and remove many obstacles to technological innovation.

A Basic Income would ensure that people have access to money when they are in financial need. It does not interfere with incentives to increase income and it rewards self-help. It inculcates the young, reminds the middle aged and the old of the need to ensure that no one goes to bed hungry and in this way allows and encourages intergenerational transfers by underlining the importance of social solidarity. It stigmatises no one because it treats all permanent residents equally.

It converts meaningless phrases like “increasing community capacity” or “increasing social capital” or “ensuring social insertion /inclusion” into a substantial process by encouraging sharing while allowing an equal taking from society’s income pool. It is a universal program, and because it does all these things, it enhances the quality of community life. Above all, it is the decent thing to do.

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About the Author

Dr John Tomlison is a visiting scholar at QUT.

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