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Welsh Labour’s UBI Pilot Is a Step to Fixing Our Broken Economy

Faced with rising poverty and the threat of automation, the Welsh government is rolling out a Universal Basic Income pilot – its aim is to show that bold policies can transform our broken economy.

Almost a year ago, Welsh Labour won a historic victory in the Senedd elections. This included impressive victories in ‘Red Wall’ seats that were lost to us eighteen months previously, as well as victories in constituencies that have not been won by UK Labour in Westminster elections since 2005.

We were led to this victory by Mark Drakeford, a Welsh socialist who combines a thoughtful analysis of the challenges society faces and a policy brain focused on solutions. I am proud to call Mark a friend, so some may call me a little biased. It is clear, however, that you learn how to succeed from winners and Mark won big.

Our election campaign was centred on Mark’s record of handling the pandemic, but also a bold manifesto. Included in that manifesto was a commitment to a trial of Universal Basic Income (UBI). This is something I have championed for a while and included in a piece written for Labour List the year prior to the election. It was following a debate in the Senedd where a UBI trial was supported by a majority.   

My reasons for wanting a pilot are clear, I want us to gather evidence of the effectiveness of a Universal Basic Income. We face tremendous challenges in this country, and we will need solutions that will address them and ensure that people are not left to sink into deprivation. We need to reshape our economy to meet the challenges of climate change, to address the growth in poverty and inequality in a country whose labour market is increasingly precarious, and to meet the long-term impact of Covid.

The future is difficult to predict. We have been exposed to so many global shocks in recent years that it can be easy to become blasé about them, but each one has sent people’s lives spiralling. The certainties people once knew are quickly disappearing. I use the word ‘spiralling’ deliberately because once these shocks hit, they send the lives of communities into chaos. Representing Alyn and Deeside, I am all too aware of this. Shotton Steel saw Europe’s biggest single day mass redundancy in the 1980s and the impact of that day is still felt today.

Lifting people out of poverty is often seen as the solution and it should remain part of Labour’s mission statement, but the key must be to have robust systems in place to stop them falling into poverty in the first place. Poverty, particularly in childhood, can be life changing. The evidence of the impact is overwhelming – the likelihood of suffering from one or many adverse childhood experiences when living in poverty increases dramatically. This comes at a huge cost to these individuals and to society.

I barely scratch the surface when I point out that children growing up in poverty are more likely to have serious health problems, poor nutrition, chronic diseases, and mental health problems.  Poverty puts huge strain on families and on a child’s development. This makes a compelling case for the kind of social floor a UBI can provide.

An additional factor that drew me to the policy, of course, was the potential for automation and artificial intelligence to make our lives better if we harness new technologies to serve us all and not a few. To say the least, this process will not be a smooth one. Many jobs we consider well paid could shortly be lost to AI.

It is this uncertainty that drew me to investigating a UBI. Do not take from this that I am pessimistic about the future. In fact, I am that most optimistic of people, a trained engineer. It was literally my job to manage change and seek solutions.

Following our election victory, the Welsh government took a step forward and a pilot of 250 care leavers was announced. The pilot will consist of regular payments made from the government to care leavers, and crucially will come without means testing. Helping such a vulnerable group should not be controversial but the politics and language around welfare has often been far from reasonable.

Following the announcement of this trial, UBI campaigners submitted a petition through the official Senedd petitions process calling for the trial to be expanded. Not because they didn’t want to support care leavers, but because they thought a broader trial would bring with it more useful data on how a UBI could help address problems.

The committee I chair produced a report which you can read here. Having heard evidence from a wide range of stakeholders, the committee concluded that a broader trial would ‘allow the Welsh government and the general public to understand how the policy would impact Wales if it were rolled out tomorrow.’

Whether the Welsh government can introduce a broader trial or not, a bold conversation is taking place in Wales about how we eliminate poverty and solve the huge issues I alluded to earlier. A full UBI cannot be achieved in Wales alone; welfare and budgets sit with the UK government. We need a Labour government in the UK to instigate this change but the evidence gained in Wales could be key to this.

This pandemic has created a period of tremendous churn where we have seen the state support people in a way we would have previously considered impossible. Out of previous trauma, Labour founded the NHS – something that came from Welsh Labour. Could a UBI be this generation’s NHS?

I am immensely proud of the work every Labour government has done to make our country a better place and hope that the next one will look to Wales and learn that Mark Drakeford has won on a bold agenda, just like those Labour governments we so proudly talk about.