inc Explanatory Note 15

(15) A Citizens’ Dividend

The concept of a Universal Basic Income (UBI)  –  a regular and unconditional cash transfer from the state received by all individual citizens in acknowledgement of the part they play in generating the wealth currently enjoyed by only a few  –   needs no introduction. It is an idea that, in varying shapes, political parties across the world are now adopting as official policy.

Constitutionalists are well aware of the many issues, positive and negative, raised by this idea: its alleged effect on work incentives, its affordability and funding, its transparency, its administrative efficiency, its potential for contributing to sustainable consumption, its relevance to mounting automation and to freeing people from a life reduced to shopping between shifts at work; its role, finally, as a first and tentative step in creating a new economic and social order.  

Constitutionalists believe that the list of issues raised by the idea of a UBI should now be the focus of democratic deliberation.  However, unlike redistributive benefits that are funded from taxes that penalize productive effort, the UBI is neither benefit nor redistributive, and could be seen rather as a dividend paid to all citizens out of the rents (i.e. the net national income) from the location value they all help to create.  Its payment becomes possible once the fiscal system has been restructured to include a Location and Amenities User Fee that honours the principles of both fairness and economic efficiency.