Finland's basic income trial fails to spur employment

Eeva Repo tutkii vihannespussia kaupassa

For a lot of people on the left, UBI focuses too heavily on individuals' personal wealth and buying power - or rather, their lack of it - without doing anything to stop companies wasting resources by producing far more stuff than people need, and over-working their employees in the process. We want to keep our journalism open and accessible and be able to keep providing you with news and analyses from the frontlines of Israel, the Middle East and the Jewish World.

"The impact on employment seems to have been minor on the grounds of the first trial year", Finland's minister of health and social affairs Pirkko Mattila said.

The program was created by the Social Insurance Institution (Kela), which is a Finnish government agency.

Finland - the world's happiest country previous year, according to the United Nations - is exploring alternatives to its social security model. It can also encourage people to try a new job without the fear of losing their unemployment checks or having to go through the paperwork of reapplying for benefits.

Universal basic income (UBI) has become a hot topic in many Western developed nations, where it appears that automation and advancements in AI might gradually increase unemployment to potentially risky levels.

Sini Marttinen, 36, had been unemployed for almost a year before "winning the lottery", as she described the trial.

The 2,000 picked randomly - aged between 25 and 58 years - receive 560 euros ($635) monthly, unconditionally and without intrusive means testing.

In the Finnish experiment, the basic income is below what unemployment benefits pay, which is 32.40 euros a day, or nearly 1,000 euros ($1,135) a month - subject to income tax of about 30 percent. After the tax, employment may give only a marginal increase in the monthly income, while free time is lost.

That followed the imposition of benefits sanctions on unemployed people who refused work.

Critics say universal basic income reduces incentives for people to look for work.

The Paris-based Organisation for Economic Cooperation and Development (OECD) has claimed that a basic income programme in Finland would not be economically viable and could leave significant numbers of people in worse poverty than now. Italy is due to introduce a "citizens' wage" in April in a major overhaul of the welfare state, which will offer income support to the unemployed and poor.

The country's government published the first findings from the trial, which ended a month ago, on Friday.

"The recipients of a basic income had less stress symptoms as well as less difficulties to concentrate and less health problems than the control group".

Last year, the newly elected Ford government of Ontario pulled the plug on a basic income pilot project created by the previous Wynne government.

This story has not been edited by Firstpost staff and is generated by auto-feed.

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