Governmental Basic Income Experiment 2017/2018, Finland [1]

What we can learn from Finland: It’s not that difficult to organise a Basic Income pilot when you have an existing welfare system!
Interview with Otto Lehto, member of BIEN Finland

Compare the execution of the government Pilot with BIEN Finland’s[2] expectations before the election:
It is pretty much what we expected. There were more technical difficulties during the launch phase than anticipated, so there was some worry about not starting on time, but it all worked out!
Kela is the driving force of this experiment, they have made all decisions semi-autonomously, subject to the approval of the national government. BIEN Finland was consulted, but had no formal say. Some of our input was listened to. On the whole BIEN would have designed a different experiment, with the following 3 changes:

1. Chose a bigger sample size.
   This would have meant a bigger budget for the experiment, obviously (s. 3.)
2. Chose from a broader selection of groups – not exclusively unemployed, also students and young people, for example.
3. tax system reform: Raise taxes for those who earn a decent wage on top of their basic income.
   Installing a basic income system without a tax reform is not economically sustainable.

BIEN Finland doesn’t favour a certain model, but there are many different models from different parties – any one of those would have been an improvement on the current tax system.

 

How were the participants in the pilot recruited?

• recipients of Kela labour market subsidy or basic unemployment allowance
• random selection
• 26-58 year old
• compulsory attendance, once selected
  excluded: anyone not unemployed at time of selection

 

Which of the four criteria does it meet? Universality? Individuality? Unconditionality? Sufficiency?

1. Individuality: yes
   (due to random selection and small sample size, it is mostly only 1 person per household)
2. Unconditionality: yes
   (for people meeting sample condition – they receive it for 2 years, no matter what)
3. Universality: no
4. Sufficiency: yes
   (because it doesn’t have to cover the rent – receipients are entitled to receive housing benefits on top)

 

How many persons benefit from it at the moment?
2,000
Their – non-receipient – family members might also benefit – however it is not clear at this point, if family members will be included in the study.

 

Where does the money come from?
It is a specially earmarked government fund allocated to this 2-year-experiment. The receipients would usually receive unemployment benefits instead.

Reports[3] say that analysis of the pilot will focus mainly on labour market effects. What other effects would you like to see analysed?
There is a troubling question about how well the data will be collated – it has not been officially announced, who will be incharge of this, and we don’t know what kind of questions will be asked about the overall effect on people’s lifes and their community.
Employment effects is not the sole goal, Kela also includes research interest in globalisation, technological changes and automation.
Of course work incentive is the government’s main interest.
BIEN would like to also see a focus on basic income as a human right as laid out in the Finnish constitution[4] and the international bill of human rights.

 

What are currently the strongest voices against against the pilot project and what are their three main arguments?
There is almost no group opposing this pilot. Even opponents of basic income (i.e. established parties like conservatives and social democrats) support the experiment – it is such a small sample that the cost is relatively low – probably hoping that it might be the last they hear of basic income.
The Green and Left parties would like the experiment to be extended, seeing it as a stepping stone towards broader implementation of basic income.

 

How is the Finnish basic income pilot different from other social benefit schemes (governmental or otherwise)?
There are 2 important differences:

1. It is the same level for all receipients
2. You keep receiving it when you find employment

 

What does 560€ buy in Finland?
560€ a month, being the level of minimal welfare / unemployment benefits covers the basic needs just above poverty level (without rent).

 

Are there collaborations / joined studies with other pilot projects around the world?
As Kela is keeping active links within the international research community, there is continued exchange of information. The Finnish model is being used as a model for other countries, who have visited Finland and Kela. However, there is currently no official collaboration to my knowledge.

 

What can the countries using the Finnish experiment as a model learn from your pilot?

1. Please ask me again in 2019, when I have read the analysis! 🙂
2. As far as what we know now: It’s not that difficult to organise a Basic Income pilot, if you have an existing welfare system!
3. It’s a good idea to have a random selection AND compulsory attendance – to minimise no selection bias, but it would be good to also have a more local, dense sample. Giving everybody in one municipality basic income would provide better results.
4. 2000 is too low a sample number, if you want to study large scale effects.

 

 

Criteria met:
1. Universality – no
2. Individuality – yes
3. Unconditionality – (yes) within sample
4. Sufficiency – yes
How many people benefit: 2,000

 

Otto Lehto  – political economist, member of BIEN Finland, interviewed by Manja Taylor – basicincomeweek mobilisation team, on 16th Sep 2017.

 

[1] http://www.kela.fi/web/en/basic-income-experiment-2017-2018

[2] http://perustulo.org/

[3] http://basicincome.org/news/2017/05/finland-first-results-basic-income-pilot-not-exactly/

[4]  http://www.finlex.fi/en/laki/kaannokset/1999/en19990731.pdf