It isn’t Universal Basic Income, but Spain needs this

Spain is set to ramp up economic measures for the poorest in society to help battle against the pressures of coronavirus.

With little else to talk about in the media, many Anglo-centric media groups have misinterpreted Spain’s intention to implement a basic income for its citizens. With many referring it to Universal Basic Income (UBI), when in fact it is more like the UK’s Universal Credit.

With the globalised world economy coming to a halt, many in the western world have been looking to the future of our society. Aside from dystopian novel sales rising, many across the political spectrum have been discussing UBI, but there seems to be a confusion about what it is.

BIEN Basic Income Earth Network, a global network of academics and activists supporting the scheme describe it as.

basic income is a periodic cash payment unconditionally delivered to all on an individual basis, without means-test or work requirement.

El Pais reported that the coalition government, between the centre-left PSOE and anti-austerity party Podemos, intended to bring forward plans for a basic income for its citizens. This is amid the crisis of the Coronavirus which has hit the country’s economy hard, and is set to get worse than the 2008 financial crisis. Podemos, founded during Spain’s last economic meltdown, have been heavily pushing the message that they will leave no citizen behind as they were in the aftermath of the last economic crisis.

Yet, whilst this initiative is needed, it has been taken out of context by many media outlets. It will not be a universal payment to all citizens, and it will be means tested which means it goes against the basic principles of UBI.

Photo by Toa Heftiba on Unsplash

If anything, it is more like the UK’s villainised Universal Credit.Separating the two here is essential. Having worked in healthcare prior to the implementation of Universal Credit in 2013, I agree that the UK’s benefits system prior to this was a huge mess.

The excuse used to implement Universal Credit was that it simplified the benefits system, it put seven different types of benefit into one. This benefit includes housing benefit, children’s allowance for up to two children, unemployment, and disability payments. It is available to all over 16 and under retirement age. It is means-tested, and they calculate the persons entitlement and put it together in a payment.

However, like most things, it was a lot different in reality, and the roll out was poorly executed. Universal Credit in the UK has got a bad reputation as really it was an excuse to overhaul the benefits system, cutting benefits for the most needy. It was also badly set up leading to people having to wait months for a payment. That and the sanctions system where people could have their benefits docked if they never filled the criteria such as spending over 30 hours looking for work a week or being late for an appointment. There was also the brutal reassessment of people with disabilities.

For a good overview I suggest watching Ken Loach’s I am Daniel Blake for a realistic representation of how people got stuck in the gaps and waited on phones for hours on end.

Photo by Braden Collum on Unsplash

Historically, Spain has had one of the barest welfare systems in Europe. Indeed, at Pedro Sanchez’s initial lockdown speech he reminded people the elderly had sacrificed their pensions and homes to support their family in 2008 when the country hit rock bottom.

Whilst you may have seen elsewhere that Spanish pensions are high compared to other countries, these statements forget to address the fact that Spain has limited other welfare support for people to access. Housing benefit and council houses are good example.

The benefits are split into two groups, contribution-based and non-contribution based (disability benefit etc). Please be aware I am not an expert, and this is not a guide to your entitlements which may change during the crisis. For the latest information, look on the Social Security website.

Contribution based payments include unemployment benefit. To qualify for this you have to contribute social security payments for a minimum of 360 days (this has been wavered for the Coronavirus crisis). The amount you contribute dictates how long you are entitled to the benefit for. You basically build up an allowance with the state. If you contribute for 360 days, you will be entitled to 120 days’ worth of payments on this scheme called Paro. It can be removed if you are caught working or you don’t meet certain criteria which are not as strict as the UK.

However, it is more complicated; you get 70% of your salary for up to six months then it declines to 50% until your allowance runs out (up to 720 days if you have contributed for more than 2,160 days). Then, when your allowance runs out, you go on to a non-contribution-based benefit called Subsidio de desempleo which is means tested.

The new scheme being called a minimum vital income is aimed at the poorest families in the country. It will consider income, assets, family size and level of poverty. It can be claimed whilst people are in work and is said to encourage people back to work rather than them becoming reliant on it. The scheme sets out to tackle fraud and the working on the black market, which is highly prevalent in Spain.

Further details are yet to be released, but the scheme is set to be rolled out in May and stay after the pandemic. The government is hoping to use it to replace other state benefits that currently exist.

This scheme was originally proposed in Spain’s 2019 election, and is one of the policies the progressive coalition want to put in place to combat the country’s poverty problems where 26% of adults are at risk of living in poverty or social exclusion.

The UN special rapporteur on extreme poverty and human rights, Philip Alston, said this in his report after his fact-finding mission to the country back in early 2020:

“But Spain today needs to take a close look at itself in the mirror. What it will see is not what most Spaniards would wish for. The self-image of a close family-based society rooted in deeply shared values and social solidarity has been badly fractured by an economic crisis and the implementation of neoliberal policies. The local and familial safety nets that had been historically important continue to work for the well-off, but have been undermined for a large part of the population.”

This type of welfare will be different for many in Spain and it will make a huge difference in this time of uncertainty. With a price tag of 5.5 million euros, I hope that the coalition government rolls it out correctly and doesn’t make the same mistakes as the UK government.

If Spain needed the minimum vital income back then, many families will need it more than ever in the future.

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