Written answers

Thursday, 3 June 2021

Department of Enterprise, Trade and Employment

Universal Basic Income

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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56. To ask the Minister for Enterprise, Trade and Employment the engagement he has had to date with the Low Pay Commission regarding the review of international pilots of a universal basic income; the terms of reference of the review; the input his Department will have into the review; and if he will make a statement on the matter. [30199/21]

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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The Programme for Government includes a commitment to ‘Request the Low Pay Commission to examine Universal Basic Income, informed by a review of previous international pilots, and resulting in a universal basic income pilot in the lifetime of the Government’. Earlier this year, I formally requested the Low Pay Commission to examine this issue.

The Low Pay Commission recently finalised terms of reference for research on this issue. The Commission has asked ESRI to conduct this research, under the terms of the Low Pay Commission / ESRI Research Partnership Agreement.

The study will examine universal basic income pilots that have taken place in other countries to identify what was learnt and that could be relevant to a pilot in Ireland. It will also seek to identify what policy objectives a universal basic income pilot could examine and its associated risks and fiscal implications.

It will conclude with recommendations on how a universal basic income pilot in Ireland could be designed.

The terms of reference for this research are provided below.

The Low Pay Commission intends to provide a report to me on this research and their recommendations later this year.

I will then work with my officials to examine the Low Pay Commission’s findings and recommendations.

Universal Basic Income Study Terms of Reference

Question 1: What are the key messages from academic literature on UBI?

a) from the literature, identify the main policy objectives a UBI is expected to deliver

b) from the literature, identify the key risks of introducing a UBI and potential mitigation actions

Question 2: How have other countries run UBI pilots? And what can be learnt from them to guide Ireland’s pilot?

Examine Universal Basic Income (UBI) pilots in other countries, specifically:

a. establish the main policy objectives that each pilot sought to examine;

b. identify any potential policy objectives that were considered but then excluded and why;

c. describe the scope of each pilot;

d. summarise the findings of each pilot and assess their robustness;

e. assess how, in retrospect, each pilot could have been improved, and

f. draw conclusions from all of the above for any UBI pilot in Ireland.

Question 3: How might a UBI in Ireland work? What policy objectives might a UBI aim to achieve in the Irish context?

Consider the implications of the introduction of UBI in Ireland by examining:

a. The different rates at which UBI could be set;

b. the fiscal implications of the different potential rates of UBI (what it would cost in gross and net terms and how it might be funded);

c. the possible interactions between UBI and other policy instruments, such as tax rates, social insurance rates;

d. the labour supply implications of any tax changes needed to finance the introduction of UBI;

e. the distributional consequences of the introduction of a UBI scheme compared to the current contingency-based scheme;

f. depending on the differing UBI rates, what changes to other policy instruments might be considered as part of the introduction of UBI (might part of the state pension, carers allowance etc. be redesignated as a UBI payment?);

g. the impact on recipients (e.g. health, education opportunities, etc.) and

h. on the basis of the above, what research questions might a UBI pilot answer?

Question 4: How might a UBI pilot be designed for Ireland? What question(s) should a UBI pilot aim to answer?

Drawing on questions 1, 2 & 3, make recommendations for a UBI Pilot for Ireland, including areas such as:

a. which policy objectives could be accurately assessed in a pilot;

b. what risks would be associated with the pilot and how would they be mitigated;

c. whether the payments made to participants in any UBI trial should be fixed across participants or based on the net payment they would receive after any anticipated tax/welfare changes.

d. scope/parameters/rules;

e. target population(s);

f. expected expenditure on UBI payments during the course of the study;

g. evaluation methodology;

h. metrics, and

i. data collection procedures.

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