benefits

Citizen’s income – Universal basic income

Citizen’s income – Universal basic income

A citizen’s income,  basic wage or Universal basic Income (UBI) is a concept of paying everyone in society a universal benefit – regardless of income and circumstances. The main advantage is that ensures a minimum standard of income for everyone – without any costs and bureaucracy of means tested benefits. Also, it avoids the disincentive to work that can occur with means tested benefits. The disadvantage is that is an expensive undertaking to pay everyone in society a universal benefit and there is a concern it may encourage some to live…

Benefits and benefits in kind by income decile

Benefits and benefits in kind by income decile

The average UK household receives on average £6,045 a year in government benefits (2013/14) (ONS, average incomes table 14, June 2015) The main benefits are: State pension Tax credits Housing benefit Unemployment benefit Disability allowance / incapacity benefits Student support Child benefit See benefit spending UK The biggest benefit is the state pension, with the average household receiving £2,931. Although many benefits are means tested, the poorest income decile (bottom 10%) don’t actually receive the highest level of benefits. The poorest 10% receive £5,785. It…

Should welfare benefits be increased to reduce inequality?

Should welfare benefits be increased to reduce inequality?

Readers Question: Should the government provide more welfare support programs such as child tax benefit and unemployment insurance in order to decrease economic inequality? This is a classic dilemma that governments face. To simplify the argument. Higher welfare benefits help to reduce inequality and reduce relative poverty. Higher benefits will give those on low income a better living standard and help contribute to a more cohesive society. However, opponents argue that: Increasing welfare benefits creates a disincentive to work. If welfare benefits are too generous, people may have a strong incentive to avoid work or…

The Growth of Welfare Spending in the UK

The Growth of Welfare Spending in the UK

Welfare spending in the UK is a controversial topic. There is significant political and public concern at the growth of welfare spending in the past few decades. In particular, there is a fear that the growth of the welfare state is encouraging a ‘dependency culture’. But, how much has welfare spending actually increased by? Are we really a nation of scroungers or is the extent of welfare payments exaggerated? One important point to bear in mind is that in a recession, we expect welfare spending to increase….

Did Generous Welfare Payments Cause the Recession and Unemployment?

Did Generous Welfare Payments Cause the Recession and Unemployment?

Casey B. Mulligan, from the University of Chicago suggests a theory for a major cause of the great recession and the rise in US unemployment post 2008. – Higher welfare payments. ..Redistribution, or subsidies and regulations intended to help the poor, unemployed, and financially distressed, have changed in many ways since the onset of the recent financial crisis. The unemployed, for instance, can collect benefits longer and can receive bonuses, health subsidies, and tax deductions, and millions more people have became eligible for food stamps. Economist Casey…