Participation Income: Lessons from Finland and beyond

Participation Income is an innovative model of social security which aims to tackle not only social problems but also the climate emergency.

Universal Basic Income (UBI), a programme in which all adult citizens are given a regular amount of money to spend on what they choose, dominates the debate on the future of social policy. It is based on the idea that in the middle of plenty, millions of people still suffer from unemployment, underemployment, and a lack of means to have a meaningful life, and that a regular grant will provide a basic threshold to guarantee a certain quality of life.

Basic income schemes have already been piloted in Finland, Canada, Los Angeles in the US, and Wales, among others. And many countries have dealt with the social protection gap in hard times by providing temporary cash transfers with no strings attached, as happened in response to COVID-19 in Japan, South Korea and the US.

While arguments still continue over the predicted impact of new digital technologies on employment as a result of increasing automation, there is a pressing crisis that also calls for radical changes in social policy: the climate emergency.

Wellbeing not economic growth

Welfare regimes all rely on the dividend of future productivity growth to underwrite increases in welfare spending. Even if economic growth could be decoupled from emissions, this is unlikely to happen fast enough to arrest global warming between 1.5 and 2°C, which scientists estimate is necessary to avert catastrophic changes.

There is fledgling research on new models of a welfare state which is not built on productivity and economic growth, but upon an architecture of sustainable wellbeing and care. UBI is the best known alternative to traditional welfare states. But it fails to meet the challenge for building a sustainable and just society.

Getting "free" money on its own won't encourage people to use less fossil energy and do less of the things currently driving climate change. UBI schemes also consider monetary income as the route to meeting basic needs, strengthening the role of money in everyday life and leaving existing social relations untouched. Such schemes might entice politicians to cut resources from public services.

UBI does not fit well with the call for a more interventionist state to grapple with the climate emergency either. It is based on the idea of an individual right to income without recognising the value of common action or reciprocal behaviour. Claimants may withdraw from the community and never explore their full potential as community members.


Participation income

The original participation income model (PI) was proposed by the British economist Anthony Atkinson in 1996. It is similar to UBI, but obliges people to do something in exchange for the money they receive. These activities can contribute to both the capacity of the community or the individual, like care work or attending language courses. For the most part, claimants know best what activities would be appropriate, and it would allow them to engage in a reciprocal relationship with society.

These activities could include gardening or tree planting, essentially anything that involves restoring biodiversity and bolstering natural solutions to climate change. And it can even replace or be integrated into current labour market policy measures which aim to equip unemployed persons with new skills to reenter work.

PI does have some weaknesses which need to be overcome. Atkinson envisioned nearly every person in society being eligible for the scheme, as monitoring eligibility would be difficult and incur hefty administrative costs. The PI model could be revised so that the payment reaches people on low incomes who currently rely on means-tested benefits.

Some people will also choose not to take part in participatory activities, but they must not be allowed to slip through the net. If PI was given as a “top-up” to a guaranteed minimum income, receiving PI would be seen as positive and losing it could not be regarded as a sanction.

Importantly, if the participatory activities were imposed upon people, they would remain in a subordinate position and may be stuck doing similar duties repeatedly. Allowing PI recipients to choose their activities would let them decide how to enrich their own lives and the life of their community. This model could involve community-based organisations, public providers and local residents' networks in planning a range of development projects.

Innovative models of social security are especially important for people who may not be able to find green jobs, or households and communities with limited resources, who may not have the time or money to adopt energy-saving technologies or a climate-friendly diet.

PI is no panacea, but it could be useful for helping build a welfare state model fit for the 21st century.


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