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The Finnish government has decided not to expand a limited trial in paying people a basic income, which has drawn much international interest.

Currently 2,000 unemployed Finns are receiving a flat monthly payment of €560 (£490; $685) as basic income.

"The eagerness of the government is evaporating. They rejected extra funding [for it]," said Olli Kangas, one of the experiment's designers.

Some see basic income as a way to get unemployed people into temporary jobs.

The argument is that, if paid universally, basic income would provide a guaranteed safety net. That would help to address insecurities associated with the "gig" economy, where workers do not have staff contracts.

Supporters say basic income would boost mobility in the labour market as people would still have an income between jobs.

Finland's two-year pilot scheme started in January 2017, making it the first European country to test an unconditional basic income. The 2,000 participants - all unemployed - were chosen randomly.

But it will not be extended after this year, as the government is now examining other schemes for reforming the Finnish social security system.

"I'm a little disappointed that the government decided not to expand it," said Prof Kangas, a researcher at the Social Insurance Institution (Kela), a Finnish government agency.

Speaking to the BBC from Turku, he said the government had turned down Kela's request for €40-70m extra to fund basic income for a group of employed Finns, instead of limiting the experiment to 2,000 unemployed people.

In a statement later, Kela stressed that the pilot would run its full course to the end of this year. "There are currently no plans to continue or expand the experiment after 2018," it said.

The pilot's full results will not be released until late 2019, once its impact on participants has been assessed.

Read more on this topic:

Another Kela researcher, Miska Simanainen, said "reforming the social security system is on the political agenda, but the politicians are also discussing many other models of social security, rather than just basic income".

Image caption Olli Kangas wanted the two-year trial to be expanded to people in work

When Finland launched the experiment its unemployment rate was 9.2% - higher than among its Nordic neighbours.

That, and the complexity of the Finnish social benefits system, fuelled the calls for ambitious social security reforms, including the basic income pilot.

OECD finds drawbacks

In February this year the influential OECD think tank said a universal credit system, like that being introduced in the UK, would work better than a basic income in Finland. Universal credit replaces several benefit payments with a single monthly sum.

The study by the Organisation for Economic Co-operation and Development said income tax would have to increase by nearly 30% to fund a basic income. It also argued that basic income would increase income inequality and raise Finland's poverty rate from 11.4% to 14.1%.

In contrast, the OECD said, universal credit would cut the poverty rate to 9.7%, as well as reduce complexity in the benefits system.

Another reform option being considered by Finnish politicians is a negative income tax, Prof Kangas said.

Under that scheme, people whose income fell below a certain threshold would be exempt from income tax and would actually receive payments from the tax office.

The challenge is to find a cost-effective system that incentivises people to work, but that does not add to income inequality, Tuulia Hakola-Uusitalo of the Finnish Finance Ministry told the BBC.

What do others say about basic income?

Some powerful billionaire entrepreneurs are keen on the idea of universal basic income, recognising that job insecurity is inescapable in an age of increasing automation.

Among them are Tesla and Space X CEO Elon Musk, Facebook's Mark Zuckerberg and Virgin Group boss Richard Branson.

US venture capitalist Sam Altman, who runs start-up funder Y Combinator, is organising a basic income experiment.

Y Combinator will select 3,000 individuals in two US states and randomly assign 1,000 of them to receive $1,000 per month for three to five years. Their use of the unconditional payments will be closely monitored, and their spending compared with those who do not get the basic income.

In 2016, Swiss voters overwhelmingly rejected a proposal to introduce a guaranteed basic income for all.

Supporters of the proposal had suggested a monthly income of 2,500 Swiss francs (£1,834; $2,558) for adults and also 625 Swiss francs for each child.

Update 26 April 2018: This article has been amended to clarify the future of the basic income pilot in light of a new statement from Kela.</s>Finland’s government has rejected calls for the expansion of its universal basic income trial, reports the BBC . Finland initiated the trial in 2017, which saw 2,000 unemployed Finns receiving a monthly payment of €560 (about $685), regardless of whether they found a job or not. Supporters of universal basic income say a UBI gives people a safety net that could encourage more of them to take risks to become entrepreneurs and provides income stability in an economy where unstable jobs like those found in gig work are becoming more widespread.

Finland’s Social Insurance Institution (Kela) was hoping to expand the trial to see how employed people reacted when they too received a regular monthly UBI payment from the government, but the Finnish government rejected the request for extra funds. The universal basic income trial will now come to an end later this year.

A February study by the Organisation for Economic Co-operation and Development (OECD) found that Finland’s income tax could increase by almost 30% under basic income and the poverty rate could go from 11.4% to 14.1%.</s>When the Finnish government embarked on a trial of basic income it was lauded as bold, evidence-focused and innovative. The country became something of a standard bearer in a worldwide push towards basic income projects. In failing to commit to widening the scope of the trial in 2019 beyond its current group, however, that reputation is under threat.

Universal basic income (UBI) in its purest form is a payment that every citizen receives on a regular basis, without condition and as of right, in and out of work. Universal credit is paid on a household basis, is means tested and conditional, for example on recipients proving that they are actively searching for and accepting offers of work. The Finnish trial is not universal, as only 2,000 unemployed people were selected for it, but it is a basic income.

Developing an understanding of basic income is a marathon, not a sprint. As 2019 parliamentary elections approach in Finland, it would appear that boldness is being replaced by timidity and politics. We know from past experiments that basic income has significant merits. While basic income is in vogue now, it is not new. When the data from a 1970s trial in Dauphin in Canada was crunched, the positive impacts on health, education and wellbeing were clear. Research from 2018 on Alaska’s dividend scheme suggested that universal payments do not undermine work, as critics have claimed.

With economic security further under threat by technological changes, new sources of economic security could become necessary: UBI is one. Developing a fully implementable and affordable national UBI scheme will take time. It is one reason the Royal Society for the encouragement of Arts, Manufactures and Commerce has proposed a basic opportunity dividend of up to £10,000 a person in any given 10-year period to provide people with the security to make different choices in their lives. This would be a stepping stone towards UBI. But trials are essential, too – which is why it is encouraging that the Scottish government is looking at hosting some.

Hopefully, the next Finnish government will review the evidence when it comes to renewing or extending the basic income trial after the election – the world is watching.</s>With high-profile champions such as Richard Branson, Facebook boss Mark Zuckerberg, and Tesla CEO Elon Musk, backing the idea of governments giving non-working people money (from working people) to do nothing - what could go wrong?

Well, two years after enthusiastically beginning its experiment with a universal basic income - in which people are paid an unconditional salary by the state instead of benefits - Finland is abandoning the project as government enthusiasm wanes and additional funding requests are rejected.

As a reminder, The Telegraph explains Universal basic income is a form of cash payment given to individuals, without means testing or work requirements. In some models this is at a rate sufficient to cover all living expenses.
• The lack of expensive means-testing leads to a higher proportion of the budget going to recipients. This would be more efficient
• The transparency of universal payments would drastically reduce the need to detect benefits fraud
• One scheme could replace the current complex arrangement of government benefits, rebates and tax rebates
• Work will always benefit recipients of this welfare, rather than the ‘benefits trap’ that leaves part-time workers
• Universal income may be inflationary and, in attempting to move all individuals out of poverty, it may simply raise the level of the poverty line
• It may reduce the incentive to work and studies have found some evidence to support this.
• A reduction in taxable income would reduce the government’s ability to cover other expenses, such as healthcare

Universal income as a policy dates from at least Thomas Paine’s 1795 Agrarian Justice. It is currently more closely aligned with left-wing politics, where it would be funded through income from nationalised assets.

Several countries have experimented with a universal basic income, including Finland, Canada, Kenya and the Netherlands.

And now Finland has killed the plan... (via The Guardian)

Since January 2017, a random sample of 2,000 unemployed people aged 25 to 58 have been paid a monthly €560 (£475) , with no requirement to seek or accept employment. Any recipients who took a job continued to receive the same amount. Furthermore, the government has also imposed stricter benefits plans, introducing legislation making some benefits for unemployed people contingent on taking training or working at least 18 hours in three months. “The government is making changes taking the system away from basic income,” Kela’s Miska Simanainen told the Swedish newspaper Svenska Dagbladet.

Of course, the liberal socialist gliterrati are up in arms over Finland's decision.

However, as we previously noted, as automation and AI destroy millions of middle-income jobs, permanently forcing (primarily male) workers from the workforce, Americans are beginning to reconsider their attitudes toward a radical policy tool that's popular among some segments of the left: Universal Basic Income.

According to CNBC, a recent poll conducted by Northeastern University and Gallup found that . In an association that's hardly a coincidence, the poll also showed that three-quarters of Americans believe machines will take away more jobs than they'll generate...

Unsurprisingly 65% of Democrats want to see a universal basic income and 54% of people between the ages of 18 and 35 do. In comparison, just 28% of Republicans support UBI.

While proposals for universal basic income programs vary, the most common one is a system in which the federal government sends out regular checks to everyone, regardless of their earnings or employment. That system is being tested in Canada as well as Stockton, California, which recently emerged from bankruptcy but remains mired in poverty.

Perhaps Finland's failure will wake some of the free shit army up that it can't end well.</s>The Finnish government has decided not to expand a limited trial in paying people a basic income, which has drawn much international interest.

Currently 2,000 unemployed Finns are receiving a flat monthly payment of €560 (£490; $685) as basic income.

"The eagerness of the government is evaporating. They rejected extra funding [for it]," said Olli Kangas, one of the experiment's architects.

Some see basic income as a way to get unemployed people into temporary jobs.

The argument is that, if paid universally, basic income would provide a guaranteed safety net. That would help to address insecurities associated with the "gig" economy, where workers do not have staff contracts.

Supporters say basic income would boost mobility in the labour market as people would still have an income between jobs.

Finland's two-year pilot scheme started in January 2017, making it the first European country to test an unconditional basic income. The 2,000 participants - all unemployed - were chosen randomly.

But it will not be extended after this year, as the government is now examining other schemes for reforming the Finnish social security system.

"I'm a little disappointed that the government decided not to expand it," said Prof Kangas, a researcher at the Social Insurance Institution (Kela), a Finnish government agency.

Speaking to the BBC from Turku, he said the government had turned down Kela's request for €40-70m extra to fund basic income for a group of employed Finns, instead of limiting the experiment to 2,000 unemployed people.

Read more on this topic:
• Could this be the future of welfare?
• Will Finland's basic income trial help the jobless?

Another Kela researcher, Miska Simanainen, said "reforming the social security system is on the political agenda, but the politicians are also discussing many other models of social security, rather than just basic income".

When Finland launched the experiment its unemployment rate was 9.2% - higher than among its Nordic neighbours.

That, and the complexity of the Finnish social benefits system, fuelled the calls for ambitious social security reforms, including the basic income pilot.

The pilot's full results will not be released until late 2019.

In February this year the influential OECD think tank said a universal credit system, like that being introduced in the UK, would work better than a basic income in Finland.

The study by the Organisation for Economic Co-operation and Development said income tax would have to increase by nearly 30% to fund a basic income. It also argued that basic income would increase income inequality and raise Finland's poverty rate from 11.4% to 14.1%.

In contrast, the OECD said, universal credit would cut the poverty rate to 9.7%, as well as reduce complexity in the benefits system.</s>LONDON - The Finnish government has decided not to extend a basic income trial which has drawn much international interest, reported British media.

Finland's two-year pilot scheme started in January 2017, making it the first European country to test an unconditional basic income.

A random sample of 2,000 unemployed people aged 25 to 58 have been paid a monthly 560 euros (S$907), with no requirement to seek or accept employment. Should they find a job during the two-year trial, they still get to keep the money.

The government has turned down a request for extra funding from Kela, the Finnish social security agency, to continue the experiment, reported The Guardian.

"The eagerness of the government is evaporating," Olli Kangas, one of the experiment's designers told the BBC.

Payments to current participants will end next January and the Finnish government is now examining other ideas to reform its social security system.

It has also introduced legislation making some benefits for unemployed people contingent on taking training or working at least 18 hours in three months.

"The government is making changes taking the system away from basic income," Kela's Miska Simanainen told the Swedish newspaper Svenska Dagbladet.

The initial plan was for the experiment to be expanded in early 2018 to include workers as well as non-workers early in 2018, but that did not happen.

Without workers in the project, researchers are unable to study whether basic income would allow people to make new career moves, or enter training or education.

Professor Kangas told the Finnish public broadcaster YLE: "Two years is too short a period to be able to draw extensive conclusions from such a big experiment. We should have had extra time and more money to achieve reliable results."

The pilot's full results will not be released until late 2019, reported BBC.

Prof Kangas told BBC News another reform option being considered by Finnish politicians is a negative income tax.

Under that scheme, people whose income fell below a certain threshold would be exempt from income tax and would actually receive payments from the tax office.

Finland's unemployment rate of 9.2 per cent, higher than its Nordic neighbours.

That, and the complexity of the Finnish social benefits system, fuelled the calls for ambitious social security reforms, including the basic income trial.

The widely publicised basic income trial was aimed primarily at seeing whether a guaranteed income might incentivise people to take up paid work by smoothing out gaps in the welfare system.

Supporters argue that a universal basic income would provide a safety net and boost innovation, creativity and personal well-being, as well as helping the unemployed find temporary work, reported The Telegraph.

It would counteract the insecurity of increasing number of short term contracts offered employees and boost labour mobility by encouraging workers to take the risk of moving jobs.

US venture capitalist Sam Altman, who runs start-up funder Y Combinator, is organising a basic income experiment. Y Combinator will select 3,000 individuals in two US states and randomly assign 1,000 of them to receive US$1,000 per month for three to five years.

Their use of the unconditional payments will be closely monitored, and their spending compared with those who do not get the basic income, reported BBC.

In 2016, Swiss voters overwhelmingly rejected a proposal to introduce a guaranteed basic income for all.

Supporters of the proposal had suggested a monthly income of 2,500 Swiss francs (S$3,389) for adults and also 625 Swiss francs for each child.</s>Finland is to scrap a pioneering universal wage scheme that paid people a flat monthly fee rather than unemployment benefits.

The Finnish Social Insurance Institute - known as Kela - introduced a two-year trial of Universal Basic Income (UBI) in January last year, which saw the government pay citizens a monthly stipend of €560 (£490).

The trial was heralded as a possible solution to a future in which there will be increasing amounts of automation and rising inequality.

Across the country, 2,000 unemployed people between the ages of 25 and 58 were randomly selected for the experiment, which received international recognition for its potential impact on social security and was a European first.

Facebook CEO Mark Zuckerberg and his Tesla and SpaceX counterpart Elon Musk were among the high-profile supporters of UBI, but the Finnish government has announced it intends to scrap the project.

Under a full roll-out of UBI, all citizens - not just those looking for a job - would have been guaranteed the same monthly payment.

Its backers say it would help tackle poverty and inequality as people would not have to worry about making ends meet - and it would encourage the unemployed to find work.

But the government has rejected a request from Kela for additional funding to expand the trial to encompass a selection of people currently in work, and has decided to cancel the project once the trial ends in January 2019.

Miska Simanainen, a researcher at Kela, told Swedish newspaper Svenska Dagbladet that the government would now pursue changes that would "take the system further away from a basic income".

His colleague, Olli Kangas, told the Finnish broadcaster YLE that the scheme required a longer trial before any final decision was made.

"Two years is too short a period to be able to draw extensive conclusions from such a big experiment," he said.

"We should have had extra time and more money to achieve reliable results."

In December, Finnish MPs voted through legislation to make some unemployment benefits contingent on people taking part in training or some form of work for at least 18 hours over the course of three months.

Finance Minister Petteri Orpo has told Swedish newspaper Hufvudstadsbladet that he was considering a number of alternatives to UBI, including a universal credit system similar to the one introduced in the UK.

In the meantime, Kela has pledged to remain in touch with the 2,000 people involved in the UBI trial to analyse its long-term impacts.</s>Europe’s first national government-backed experiment in giving citizens free cash will end next year after Finland decided not to extend its widely publicised basic income trial and to explore alternative welfare schemes instead.

Since January 2017, a random sample of 2,000 unemployed people aged 25 to 58 have been paid a monthly €560 (£475) , with no requirement to seek or accept employment. Any recipients who took a job continued to receive the same amount.

The government has turned down a request for extra funding from Kela, the Finnish social security agency, to expand the two-year pilot to a group of employees this year, and said payments to current participants will end next January.

It has also introduced legislation making some benefits for unemployed people contingent on taking training or working at least 18 hours in three months. “The government is making changes taking the system away from basic income,” Kela’s Miska Simanainen told the Swedish newspaper Svenska Dagbladet.

The scheme – aimed primarily at seeing whether a guaranteed income might incentivise people to take up paid work by smoothing out gaps in the welfare system – is strictly speaking not a universal basic income (UBI) trial, because the payments are made to a restricted group and are not enough to live on.

But it was hoped it would shed light on policy issues such as whether an unconditional payment might reduce anxiety among recipients and allow the government to simplify a complex social security system that is struggling to cope with a fast-moving and insecure labour market.

Olli Kangas, an expert involved in the trial, told the Finnish public broadcaster YLE: “Two years is too short a period to be able to draw extensive conclusions from such a big experiment. We should have had extra time and more money to achieve reliable results.”

The idea of UBI – appealing both to the left, which hopes it can cut poverty and inequality, and to the right, which sees it as a possible route to a leaner, less bureaucratic welfare system – has gained traction recently amid predictions that automation could threaten up to a third of current jobs.

The Finnish finance minister, Petteri Orpo, told Hufvudstadsbladet he was looking into trialling alternative welfare schemes, including a universal credit system similar to that being introduced in the UK, when the basic income pilot ends.</s>Finland has decided not to extend its trial in universal basic income, the first welfare experiment of its kind by a European government that gave citizens an unconditional monthly payment.

The government rejected a request from Kela, the country’s social security agency, for additional funding to expand the innovative two-year pilot program, meaning it will come to an end in January 2019, the reports.

The program, which Finland inaugurated in January 2017, saw 2,000 jobless people receive €560 ($685) per month without requiring them to work or seek employment. Recipients who found a job continued to receive the payments. In 2015, Finland’s unemployment rate had hit a 17-year high of 10%, prompting calls for welfare reform.

But in December 2017, the Finnish parliament introduced legislation requiring jobless people to work at least 18 hours every three months to qualify for unemployment benefits, signaling that the welfare regime could be shifting in the opposite direction.

Advocates of universal basic income (UBI) programs, which have become more popular in recent years, argue that guaranteeing a baseline pay for adult citizens can help alleviate social issues like crime, poverty and chronic unemployment. But critics contend that UBI programs are costly and ineffective. Other countries including Holland, Canada, and Kenya have also experimented with basic income schemes.</s>There was bad news for Finnish freeloaders this week. Their government will no longer pay them to do nothing.

The country’s two-year experiment with a universal basic income was scrubbed. That won’t mean much to people around here, but it is a blow to the concept of Government as Sugar Daddy.

That should mean something to people in America, where the thought of money for nothing is gaining popularity.

Tech giants like Mark Zuckerberg and Elon Musk have expressed support of universal basic income. They say it’ll be needed when robots take over the workforce in 15 years and nobody has a job.

Politicians like Bernie Sanders are on board, saying it’s a step toward income equality and fairness that is missing in our capitalist economy.

So why did Finland pull the plug on a program that was paying 2,000 unemployed people $685 a month whether they found work or not?

Frankly, the explanation is dull, complicated and left nobody happy.

Proponents said the program wasn’t comprehensive enough to gauge its merits. Critics say it would have required a 30 percent tax increase on an already over-taxed population to be viable.

As Margaret Thatcher said, socialism is great until you run out of other people’s money.

In the U.S., a universal basic income would be funded by eliminating the existing social safety nets (unemployment, Medicare, Social Security) and using that money to pay everyone.

The figures vary, but $10,000 to $15,000 a year per person is ballpark, more if you have kids.

There are practical problems, like whether there would be enough money to cover the plan (doubtful), and how big a border wall would we need once the government start giving money away (I recommend 50 feet with machine gun nests at the top).

But the biggest problem is one of principle.

A guaranteed government income takes away the incentive to work, and work is more than just an economic factor.

It’s a vital part of what makes a society work. It teaches responsibility, self-reliance, industriousness.

I realize all that sounds very 1950ish, like Ward Cleaver explaining to Beaver why he should open a lemonade stand if he wants to buy a new BB gun. But those traits are fundamentals for success in life.

Instead of encouraging them, modern culture is diminishing their value. It’s more important to find yourself.

As Nancy Pelosi said in pitching Obamacare, it would create “an economy where people could be an artist or a photographer or a writer without worrying about keeping their day job in order to have health insurance.”

Look, I hate getting out of bed at 5 a.m. to report to coal mine as much as the next guy, but there’s something to be said for busting your butt to provide for yourself, your family and future generations.

Taking an entry-level job used to be considered getting your foot on the ladder of success. Sure, you were at the bottom, but with hard work you could climb to the top.

Now too many people consider it beneath them to work at a convenience store or fast food joint when they should be painting or taking pictures of whippoorwills in the forest.

As Finland was discovering, a universal basic income may sound like a great idea. The only thing it guarantees, however, is that it will bring more problems than it’s worth.

David Whitley can be reached at dwhitley@orlandosentinel.com
The Finnish government decides not to expand a small two-year trial of universal basic income.