Finland Considering Basic Income Welfare System

Welfare has been a part of the U.S. longer than the nation’s constitution, which was created over 200 years ago. The colonies had the British Poor Laws, which gave financial support to those unable to work, and gave work to the unemployed. Welfare reforms continued throughout the 19th century, but it wasn’t until 1935 that President Franklin D. Roosevelt enacted the groundbreaking Social Security Act to help combat the Great Depression.

That, however, is not nearly as radical the new pilot project the Finnish government is considering, in which the state would pay people a basic income regardless of whether or not they are working.

Though the exact details how much the basic income program might provide, and who’d actually be eligible for it have yet to be announced, it’s already garnering widespread interest, particularly with the some 280,000 unemployed Finnish residents. Yet about four out of five Finns are actually in favor of the idea.

“For me, a basic income means simplifying the social security system,” said Finnish Prime Minister Juha Sipila.

In the basic income system, a person would be paid without having to do any work, regardless of whether they had income from other sources, which would be subject to income tax.

The basic income system could prove to be a beneficial change for Finland, as it can actually cost an unemployed person there to take on work, since a paid temp job would result in lower welfare benefits. Worse, if that job was in a low-wage sector, the person would lose out, because there’s a delay before the authorities allow their benefits to be restored after leaving any job which came with an expiration date already on it.

However, experts say that it’s still too early to tell what the outcome of a basic income system would be.

“What would be the impact of a basic income to employment in Finland – positive or negative? We can’t really foresee how people would behave with a basic income,” Tank research centre’s Ohto Kanninen told the BBC.

Only time will tell once a pilot program is able to begin.