The coronavirus crisis could lead to the government handing out up to £1000 a month to everyone in the country in an unprecedented move, it has been claimed.
Many people are calling for a ‘Universal Basic Income’ (UBI)to be brought in as thousands of workers are laid off or left unable to earn an income due to restrictions.
In an open letter published in the Independent yesterday a group of 500 academics said it was time for governments to enact UBI “ensuring that everyone in their jurisdiction has enough money to buy the food and other essentials they need to survive."
The costs to the government would be around £66bn per month, to pay £1000 per person according to economist Daniel Susskind from Oxford University writing in the Financial Times.
He says this is, 'a fraction of the nearly £500bn bailout the UK needed to stay afloat during the 2008 financial crisis' adding: "Universal Basic Income is an affordable and feasible response to coronavirus."
The idea has been trialled in other countries around the world including Finland, Canada and the Netherlands before with mixed success.
Ireland and Denmark are have announced similar schemes in the wake of Covid-19.
Labour leadership contender Rebecaa Long-Bailey floated the prospect of universal income although she did not specify an amount of money.
The debate comes as Chancellor Rishi Sunak announced a £330billion package to help businesses during the coronavirus pandemic earlier this week.
The announcement on Tuesday at the second of now daily live press conferences delivered by the Prime Minister alongside the government's top science and medical advisers.
Mr Sunak said the Government will 'stand behind businesses small and large' as he announced the package of loans to support businesses amid the COVID-19 outbreak.
He said: “Today I am making available an initial £330 billion of guarantees, equivalent to 15% of our GDP.
“That means any business who needs access to cash to pay their rent, their salaries, suppliers or purchase stock will be able to access a Government backed loan or credit on attractive terms.
“And if demand is greater than the initial £330 billion I’m making available today, I will go further and provide as much capacity as required.
“I said whatever it takes, and I meant it.”
Mr Sunak said the Government will provide cash grants of up to £25,000 to smaller businesses in the retail, hospitality and leisure sectors with a rateable value less than £51,000.
There will also be support packages for airlines and airports in trouble.
Business rates holiday for those with smaller businesses will be extended to all businesses in those sectors irrespective of their rateable value.
Mr Sunak added: “That support will be delivered through two main schemes.
“To support liquidity amongst larger firms I have today agreed a new lending facility with the Governor of the Bank of England to provide low cost, easily accessible commercial paper.
“To support lending to small and medium sized businesses, I am extending the new business interruption loan scheme I announced at Budget last week so that rather than loans of £1.2 million it will now provide loans of up to £5 million with no interest due for the first six months.
“Both of these schemes will be up and running by the start of next week.”
Mr Sunak added that he is also taking “a new legal power” to “offer whatever further financial support I decide is necessary”.
Boris Johnson has said the Government will do “whatever it takes” to support the economy through the coronavirus outbreak.
