CORI Justice Commission statement on the publication of the Irish Government’s Green Paper on Basic Income. Download Pdf
2002 October 4th.
The following are the main points made in the statement:
- CORI Justice Commission has welcomed the publication of the Government’s Green Paper on Basic Income.
- In particular it has welcomed the fact that the Green Paper vindicates CORI Justice Commission’s claims that a Basic Income system would have a far more positive impact on reducing poverty than the present tax and welfare systems.
- The Green Paper shows that a Basic Income system would have a substantial impact on the distribution of income in Ireland in that, compared with the present tax and welfare system it would:
- Improve the incomes of 70% of households in the bottom four deciles (i.e. the four tenths of the population with lowest incomes) and
- Raise half of the individuals that would be below the 40% poverty line under ‘conventional’ options above this poverty line.
According to the Green Paper, these impacts would be achieved without any resources additional to those available to ‘conventional’ options.
- The Green Paper shows that a Basic Income system is far more effective at tackling poverty than the present tax/welfare system and should form part of a comprehensive strategy to totally eliminate income poverty in the years immediately ahead.
- The resources of recent years were more than adequate to introduce a full basic income system in Ireland. It is regrettable that the resources were not used to introduce such a system.
- The introduction of a Basic Income system would have produced a much fairer tax and welfare system. It would have moved beyond models that were appropriate to the 20th century but are not capable of effectively addressing the new economic realities of the 21st century.
- Also, it would be far more effective than the present tax/welfare system at addressing the income inequality, increased insecurity and social exclusion that accompany the ‘new economy’.
- When one looks at the ‘losers’ identified in the Green Paper, two key issues that need to be borne in mind:
Over a three-year implementation period of a Basic Income system all the ‘losers’ would be better off than they are at present. They would simply not gain as much under Basic Income as they would under the present system.
The ‘losers’ in the bottom four deciles identified in the Green Paper can be easily targeted and compensated through the Social Solidarity Fund that forms part of the Basic Income structure.
- On the macro-economic aspects the Green Paper itself acknowledges that the findings of previous studies were very tentative, speculative and hard to quantify.
- The Green Paper’s conclusion that a basic income system could encourage some people to move from the unofficial economy into regular employment is welcome.
- The Green Paper uses the tax rate (including PRSI replacement) of 47.7% which previous studies showed was required to fund Basic Income, based on January 1999 estimates. Since then the economy has grown significantly and the revised rate, based on Revenue Commissioners estimates of the tax base, is likely to be below 43%.
- The critical test of any tax and welfare system is its impact on people with lower incomes. While many poor people have benefited from developments of recent years, especially through employment, the fact remains that the gap between poor people and the rest of society has been widened over the past twelve years.
- While the proportion of the population described as “consistently poor” has been declining the percentage of households and persons below every income poverty line measured by the ESRI is higher now than it was in 1987. This situation must be reversed immediately. Obviously, the introduction of a Basic Income system would have an immediate and positive impact on those most in need in Irish society.
- The choice between a Basic Income system and ‘conventional’ tax/welfare options is a trade off between greater equity and a possible risk of slightly lower economic growth versus less equity and less risk to higher economic growth. At a time when so much concern is expressed about the country’s failure to use its recent economic growth to build a fairer society, the argument in favour of introducing a Basic Income system is further strengthened.”
CORI Justice Commission is a Social Partner and was one of the organisations that negotiated and signed the last two national agreements i.e. Partnership 2000 and the Programme for Prosperity and Fairness. It represents more than 135 religious congregations with 12,000 members in 1,400 communities throughout Ireland.