Social inequality in Australia: Is it time to seriously consider a UBI?

By Hillary Montague

A Universal Basic Income (“UBI”) may overcome social structural inequalities, poverty and the loss of dignity simultaneously and effectively. With the implementation of a UBI, individuals would have greater access to fully recognising their human rights. A widely accepted understanding of a UBI is an unconditional and fixed payment given to every member of a state which would allow them to enjoy an adequate standard of living above the poverty line. A UBI is currently topical given the public anxiety over the rising cost of living and unemployment, along with the risk of increasingly widespread poverty which may abrogate fundamental human rights. Some of the specific social problems which could be resolved by a UBI will be considered below.

As society is transitioning to a more technologically advanced age, the need for human labour is apparently diminishing, leaving many to stress over what their future holds. Welfare programs are currently insufficient to provide a living wage above the poverty line to recipients. If underemployment/unemployment is to increase, the welfare system may become increasingly strained and inadequate to dealing with exacerbating inequality. A UBI which provides a social safety net for every citizen would remove the potential anxiety associated with unemployment, consequent poverty and the loss of dignity.

A UBI likewise has the potential to alleviate many other current social issues. For example, reasons for women’s vulnerability to inequality are numerous and complex, however the implementation of a universal payment would address many of the structural barriers to financial independence. A UBI could relieve the economic stress on women, which is commonly a result of women’s wages being systematically lower than their male counterparts. Furthermore, periods of unpaid domestic labour in the household, statistically performed by women, contribute to a lack of superannuation contributions, further developing economic strain.  Domestic labour, bearing and raising children is financially unacknowledged and can be an economic detriment. As a result, women over 55 have become the fastest growing homeless population in Australia. A UBI would provide an income to mothers, lessening the financial strain on families and individuals and providing a means for women to become financially independent.

For victims of domestic violence, the economic independence a UBI could provide is likely to allow vulnerable women to leave harmful situations. Within abusive relationships, women are less likely to have control of their own or the family’s finances and consequently, women and their children are more susceptible to being trapped. An American UBI pilot scheme noticed an increased rate of divorce after the UBI’s implementation, which supports the theory that women’s economic independence would allow them to leave harmful or violent situations.

Young people would benefit from the security a UBI could provide.  In particular a UBI would assist students to focus on their studies without the need for excessive part time work and thus to be able to fully recognise their right to education. In addition, young adults, and specifically graduates, often find themselves struggling to break into a job market which requires previous work experience, unattainable without the completion of unpaid internships or volunteer experience. Accordingly, inequality is perpetuated as only young adults with the support of their parents can obtain the experience required to accelerate into a career whilst having adequate time to succeed academically. Many businesses and sectors depend on internships, and yet young people are not financially compensated for their vital role in today’s workplaces. Both the individual and the community would benefit from the long-term implications of a UBI’s application to young people.

While critics argue that tinkering with the current welfare system is sufficient to deal with these myriad issues, a UBI provides an efficient one-size-fits-all solution which is able to remedy a myriad of complex social issues rather than relying on refining an already strained welfare system. Currently, Centrelink benefits are inadequate to providing a standard of living above the poverty line for many vulnerable individuals or families. Receivers of Centrelink are subject to societal and political stigma which is both problematic and unsustainable with wage stagnation and shrinking employment figures. Poverty is perceived as the burden or result of the individual rather than a systematic (and increasing) problem which requires urgent redress. As wealth becomes increasingly concentrated in the top percentiles, a UBI is a means to equitably redistributing wealth.

The benefit of a UBI is that with a single policy, complex and structural inequalities could simultaneously and effectively be overcome whilst every member of society reaps the benefits. Implementing such a policy will not be easy. However, we should not wait until unemployment is rife, social inequalities are exacerbated and our already strained welfare system is completely overwhelmed. A UBI should be seriously considered in Australia now.

Hillary Montague is currently a law student at La Trobe Law School.

La Trobe