When Jonathan Portes has put his mind to something the policy community usually sits up. So this week we have been like meerkats, with the launch of the IGP report on Universal Basic Services.
Having read it through a couple of times, I have a few comments, which are meant simply to ask for some more information to help us understand what is actually being discussed, especially about housing and food provision.
Whilst the press reporting has mostly repeated the line about this being services for everyone, there is a pretty huge caveat running through the report about the provision of housing and food. Indeed, in the penultimate page of the report out and out says:
“ the options modelled would not be “universal” in the sense of providing free housing to all, or even to all those who would take up an offer of free, basic social housing; similarly the food program modelled is one that would end “food insecurity” rather than provide free food to all or even to all those on low incomes.“
So whilst universal does mean free bus passes, BBC services, broadband, etc. it doesn’t mean housing and food for everyone. It means “everyone who doesn’t have the resources”. So it has a form of conditionality; a bar some will pass and some will not.
This allows for the “universal” services to be highly progressive, but it opens up a whole new can of worms.
Firstly, where and how do we draw the line? At some point, assuming this is arranged by income (with perhaps an income proxy for capital) or housing need, there will someone who gets a house rent free with cash for utilities and someone else, on a slightly higher income or in slightly less need, who doesn’t.
That has the potential for all sorts of difficulties- political, societal and legal. Sure, we’ll assume the person just outside the line can still receive some support for housing (through Housing Benefit, Support for Mortgage Interest or Universal Credit– good luck to them!) but it has the potential to create a significantly unfair situation where one family is significantly helped and another very much like it has to deal with the benefit cap, LHA rates, etc.
The paper also presents people’s situation as effectively static- those in the lowest decile stay there and so on. Whilst this is sadly true in many cases, trying to make the system dynamic has the potential to redouble this problem, particularly in terms of housing. The paper suggests that rent and utility free homes could be provided for 30 years. That’s a long time and some people’s income will change. Is the paper really suggesting those who do well can continue to live rent free for a generation whilst other who fall on hard times get hard cheese?
I’m sure there are ways around this issue, but on the first couple of reads it looks like there is the potential for quite a big cliff edge between the “haves” (who, confusingly in this situation, to begin with, have not) and the “have nots” (who have slightly more to begin with!).
There are probably ways around this, most likely trying to ease the burden on those outside of the group receiving housing. But that would need to be costed itself and included in the price of the policy.
Another way would be to apply an income based approach but this would very quickly collapse back into something like a means tested benefit- exactly what they are trying to avoid!
Of course the reason housing cannot practically be a universal service is that would require public ownership of the means of accommodation. No elected government in the UK is likely to consider confiscating people’s homes for the greater good.
So, given 2 of the 4 new services being suggested for universalisation are not universal, is this just good branding of extending the welfare state? Free bus passes and kitty gifs for all as cover for social housing for some?
That wouldn’t be a bad thing. If a bit of canny marketing is required to get more affordable homes built and a better safety net for those who need food then I can live with it.
But I’d rather have a full and frank discussion about the changing nature of work, productivity any support for those who would otherwise lose out as our society and economy continues to change.