The document summarizes Fintan Farrell's presentation on approaches to welfare systems, including guaranteed minimum income and universal basic income. Some key points: 1) Guaranteed minimum income should be part of a wider social protection system including social services, pensions, child benefits, and tax policies. It ensures a safety net for those unable to work or whose benefits have expired. 2) The Finnish basic income experiment found that reducing conditionality had a positive impact on trust and wellbeing, but the effect on employment was smaller than expected. 3) Cooperation at the EU level is needed to address poverty, set common social standards, and prevent a "race to the bottom" on welfare policies between member

1. INVEST ‐ Towards the Next Welfare State?
Input Fintan Farrell
Independent Expert Social Inclusion
Helsinki
Friday 4 October 2019

2. Outline of Presentation
Acknowledge work of EAPN (www.eapn.eu) and EMIN (www.emin‐eu.net)
 Guaranteed Minimum Income
 Universal Basic Income
 Finnish Basic Income Experiment
 Cooperation at EU Level

3. Guaranteed Minimum Income
Part of a wider system of social protection/security ‐ Welfare system
 Guaranteed Minimum Income has to be part of a wider system of social security, inclusive
labour markets (work sharing) with high levels of social protection, child benefits, non‐
contributary pensions, independent living allowances, tax policies, access to social and public
services
 It is complex but that is not necessarily a bad thing
 Important not to ‘throw the baby out with the bath water’. Improve our welfare systems rather
than New Welfare Systems
 Always in need of updating and adjusting to new realities. In some EU countries key elements
are still to be developed

4. Guaranteed Minimum Income
Definition:
Minimum Income Schemes: income support schemes which support the right to a safety net for people of working
age, who have insufficient means of financial support, and who are not eligible for social insurance payments or
whose entitlements to these have expired.
 Key Principle: To each according to their needs from each according to their means – solidarity principle
 In cash‐based societies to leave people without cash is to expose them to intollerable risks
 Targeted Universalism – For everybody who needs them, when they need them, for as long as they need them
 With Minimal conditions that build TRUST in the system for the person in reciept of the Minimum Income and for
the society:
 Residency (need to facilitate that people can achieve the condition)
 Age
 Available for work (but respecting peoples choices – they know if the offer will improve their lives)
 Means tested (simplified and not passing the risks into the future of the person, or other family members)

5. Guaranteed Minimum Income
EMIN Definitions for decent Minimum Income Schemes:
 Adequate: a level of income that is indispensable to live a life in dignity and to fully participate in
society.
 Accessible: providing comprehensive coverage for all people who need the schemes for as long as
they need the support
 Enabling: schemes that promote people's empowerment and participation in society and facilitate
their access to quality services and inclusive labour markets.

6. Guaranteed Minimum Income
Good for Everyone
 MIS ensure that people who need them can remain active in society, help them reconnect to
the world of work and allow them to live in dignity.
 MIS are more likely to speed up integration into sustainable and quality employment, while
inadequate Minimum Income Schemes are likely to lock people in a cycle of dependency and
undermine pathways to social inclusion and cohesion.
 They are indispensable for more equal societies and to ensure social cohesion, which is
beneficial for the whole of society.
 Minimum Income Schemes represent a very small percentage of social spending and have a high
return on investment, while the cost of non‐investment has enormous negative impacts for
individuals concerned and high long‐term costs for society.

7. Guaranteed Minimum Income
Good for Everyone
• As the basis for high quality social protection systems, they act as ‘economic stabilizers’:
countries with high quality social protection systems are better able to resist negative
impacts of crisis and help to reduce damaging inequalities which undermine social cohesion.
• They are cost effective economic stimulus packages, as the money involved immediately re‐
enters the economy and often in areas experiencing the impacts of market failure.
• Because of the interaction between benefits and wage levels, adequate Minimum Income
schemes can play a positive role to help ensure decent wages and reverse the destructive
trend of rising numbers of ‘working poor’ in Europe.

8. Guaranteed Minimum Income
Minimum Income in EU?
 All countries in EU have MIS. IT and EL recently have national schemes.
 Intolerable variety in eligibility, governance, levels of payment, coverage, take‐up
 Adequate in fight against poverty (60% median income)? NL, DK, IE, AT, MT and
LU reach more than 60% AROP for some family types. But link to accessible
essential services (housing) is key
 In BG, RO, LT, HU, EL, PT and SK, for single persons MI does not even reach 40% of
AROP
Tested against reference budgets? 10 baskets of goods and services necessary to
reach an acceptable standard of living and to participate in society: adequate
housing, food, health care, personal care, clothing, mobility, leisure, rest,
maintaining social relations, and safety in childhood

9. Universal Basic Income
 Key Principle: The wealth of the society is collectively developed and
everyone should have the right to benefit from the wealth created.
 Key Attraction: It is for everyone, so only a minimal set of conditions are
needed. It helps to address power imbalances between people who have
financial needs and those providing the service and should help get rid of
punitive conditionality
 Key Achievement: Has generated a key public discussion and has caused us to
look a new at welfare systems
 Key Test: Will it contribute to the fight against poverty and inequality?
 Key Question: Is it the best use of available resources. Impossible to answer
in the abstract but needs a fully developed proposals in order to engage in a
response to this question

10. Finish Basic Income Experiment
Some Reflections
 Basic Income supporters have many different motivations which will impact on the design, so in
the abstract it is hard to be ‘for or against’ basic income
 The experiment was more about less conditional benefits than about universal basic income, so
it raises as a many questions as answers
 A minimal reduction in bureaucracy and conditionality seems to have a disproportional positive
impact on peoples level of trust and wellbeing
 The impact on jobs or paid working time is surprisingly smaller than might be expected.
However, from my experience of working on the ground the choice of whether to take or
continue in a job or not is not so economically determined as is generally believed. More
Important factors are: how it fits with other aspects of your life, how you are treated in the job,
what are the future prospects, does the job improve your chances to do something
worthwhile…..
 How can you ensure such social experimentation are ethical? Does it give reliable results – once
the advantage is spread to others does the results remain the same? Is the problem ‘poor
wages’ or ‘lack of motivation’?

11. Cooperation at EU level
Why Cooperation is needed at EU kevel
 Addressing poverty and exclusion constantly appears as a high expectations of European citizens of the EU
 Common high‐level social standards essential for the future of the EU and cohesion
 The alternative to cooperation on social standards is competition on social standards
Key EU actors have developed common positions
European Parliament, Committee of Regions and European Economic and Social Committee, EAPN, Social
Platform, ETUC
EU policy framework ‐ Key milestones
 1992 Council Recommendation on sufficient resources and social assistance
 2008 Commission Recommendation Active Inclusion ‐ 2013 Social Investment Package
 2010 Year against poverty + Launch of Europe 2020 strategy; target reduce AROPE by at least 20 million
 2017 European Pillar of Social Rights, including right to adequate minimum income

12. Cooperation at EU level
Key current developments
 Benchmarking of Minimum Income Schemes integrated in the Semester process
 Common EU framework for Reference Budgets to allow better comparisons and transfer of learning
 Emerging Platform of National Public Authorities responsible for Minimum Income Schemes
 Presidents Political guidelines – Hearing of Commissioner designate Schmit ‐ Action Plan on the
European Pillar of Social Rights
 German Presidency Initiative, Framework for Minimum Social Standards (Minimum wages – minimum
income)
The need to go further
 The slow pace of progress makes the case for a stronger legal instrument ‐ EU Framework Directive –
Treaty base: Art 153, 1h
 Wide spread public awareness and mobilisation on this topic is needed

13. Thank You
Fintan Farrell
Email: fintan.ff@gmail.com