Five years ago the government funded the launch of online marketplaces in which anyone could sell their spare hours to local employers. Amy Sutton, 24, from west London, is one of thousands of “slivers-of-time workers”. With a history of depression going back six years, she needed employment that would fit around the good days. At her mother’s urging she registered with an agency offering slivers-of-time work. She told its website her hourly rate, set her personal rules about the bookings she would do and then input some hours of availability for the following day.
A six-hour booking stuffing envelopes at her local council arrived in a text. Amy texted back her “Yes” code and other bookings followed; an hour of targeted public health outreach, a few hours for a charity. The system ensured that payment was transferred to her account the following week. As her confidence developed, she allowed the bookings to get longer. Now she is applying for a conventional job.
I have been programme director of slivers-of-time working (sliversoftime.info) since its inception. We have done okay, but we haven’t cracked the problem of labour market rigidity on anything like the scale intended.
There\’s a couple of things that would aid in developing this.
1) Abolish the current welfare system. Move to a citizen\’s basic income. Then there\’re none of the problems about losing benefits for a few hours work here or there. This is one of the major problems with such highly informal and part time employment in the formal economy. The marginal tax and benefit withdrawal rates.
2) Abolish all of the stupidities about \”rights\” for temporary workers. As with a citizen\’s basic income we won\’t need any such rights for anyone anyway this shouldn\’t be a problem.
You want to sell a few hours of your time? Go right ahead. You don\’t? Great, have at it. But we can only do this if we free the entire system from the assumption that you\’re either working or not working.
The administration of benefits tends to be a world in which people are expected either to have a job or to be on their way to one. There’s little comfort for those who want to find their way in the grey zone between the two.
Quite.
“The administration of benefits tends to be a world in which people are expected either to have a job or to be on their way to one.”
The administration of benefits is a world in which affairs are arranged to suit the convenience of the administrators of benefits.
If this idea was genuinely government-funded it must be one of the very few that have actually achieved a degree of success.
As with a citizen’s basic income we won’t need any such rights for anyone anyway
This is a curious statement. A CBI (in fact one of the points of it) makes losing your job a much worse event than under the current system.
Tim adds: Eh? A cbi means that you’ve got enough to live on (just) whether you’re in work or not and whatever the reason you’re not in work. And you don’t have to hang around 8 weeks waiting for benefits to come in as you get paid it every week anyway. A cbi increases the worker’s power and bargaining position precisely because no one can tell them work or starve.
No, that would be a CBI at a completely unaffordable level. At any practical amount it will not be enough to live on (unlike the benefits it replaces, particuarly as I believe the idea is to scrap all the ‘free’ stuff such as NHS) and so therefore it makes a job that much more important. This is one of the reasons why it is meant to be so incentivising compared to, say, housing benefit.
Tim adds: most of the proposals I’ve seen are that a cbi should be at or about the pension guarantee level. 113 or so a week. Not riches, to be sure, but livable. Most especially if you can have a few hours here or there without losing any of it. And as for getting rid of the NHS, no I’ve not seen that. NHS, education system etc would all remain as is (although of course there are other ideas for replacing/changing those…..but the cbi is not dependent upon them nor those ideas upon the cbi).
I have a feeling that you’ve been seeing some of the anti-cbi propaganda (They’ll abolish the NHS!) rather than any of the actual proposals.
Well there are different proposals, but one (purported benefit in some ways) of a CBI is its people spend the money, not the state.
I think £113/week rather makes the point – that would be much more expensive than current social protection expenditure, and given there would be no housing benefit or disability benefit etc I think in many cases it would be a rather smaller amount than is currently given.
“particuarly as I believe the idea is to scrap all the ‘free’ stuff such as NHS”
Eh? I’ve never seen that proposed. The papers I’ve seen propose a CBI at the level of the pension guarantee (as Tim says) and also retain means-tested housing benefit.
The CBI coupled with a tax threshold of £10,000 provides for a massive incentive to work: a marginal tax rate of 0% for each extra hour worked per week. That’s got to be better than the foul 90%+ rates of the current system.
“I think £113/week rather makes the point – that would be much more expensive than current social protection expenditure”
Not really, since you’re forgetting to factor in the savings: the army of civil servants and quangocrats to be dispensed with when everyone gets £113 a week wired into their bank accounts by standing order.
In any case, the taxation system can be adjusted to make the whole thing fiscally neutral. That also ignores the economic benefits of having people incentivized to do fulfilling work of value rather than at present paying millions of people to do nothing.
“A cbi increases the worker’s power and bargaining position precisely because no one can tell them work or starve.”
So a load of idle slackers get £113 of my money and they even have to pretend that they’re doing anything to earn it? At least with the current system, there’s a pretence of looking for work.
(Correction: “they don’t even have to pretend…”)
The CBI coupled with a tax threshold of £10,000 provides for a massive incentive to work
Minor point, but I would replace all tax thresholds with the CBI, i.e. have a completely flat rate income tax (equal to the corporate tax rate) and no extra income taxes on earned income (aka NI). Makes the deduction of tax from payrolls, bank interest, share dividends etc much simpler.
So a load of idle slackers get £113 of my money and they even have to pretend that they’re doing anything to earn it? At least with the current system, there’s a pretence of looking for work.
Ian, we pay these people the money anyway. I’d prefer CBI, as while it doesn’t force them to pretend to look for work, it does remove the tax/benefit disincentives to work. We’ll still have some slackers, but I think we will have more people working. Another point is the cost imposed by the slackers pretending to look for work. My father used to work in recruitment for a local council, and saw plenty of time-wasters just looking for the rejection letter so they could keep their job seekers allowance.
A CBI greatly reduces the need for government to know or care about personal circumstances. No more disincentive to save or invest for retirement. Circumstance-based fraud, such as claiming benefits while secretly working, or the boyfriend who pretends not to live at the address so the “single mother” can claim more, disappear, as does all the cost of trying to prevent it. It automatically rewards marriage (more correctly co-habitation) without penalising single parents.
The only downside I can see could be the total cost of the scheme, but we could adjust the rate to make it more affordable if required. For example £113 for pensioners, less for those of working age.
If you make the CBI the same as basic pension and have no means test you solve the when to retire issue. If you make averyone under 16 receive the same amount as an education voucher you go a long way to solving the school issue. Total cost c£350bn approx 25% GDP. Half current govt spending. If you take a tithe on it for local authorities (incl school voucher) you solve the rates issue. Pay 10% NI on everything (no upper limit) so that at 10x CBI no net benefit but NI and CBI linked in people’s minds. Set tax allowance at 1X CBI, effectively taking home £11k before income tax, then have 10% to 5x CBI, 20% to 10x CBI and 30% thereafter. Set CBI to increase with 3 year moving average of nominal GDP to keep safety net at fixed proprtion of GDP. Making it a CBI means no payments to non citizens (big issue with EU but worth a referendum on!) which would price british citizens back into part time jobs, reduce the black economy and deter benefits tourism. If you are serious phase it in over 3 years and promise no one will be worse off, they can elect to stay on the current system for now. A final twist, make the mother of a child eligible to claim half of the father’s CBI. If he already has another family, they get half of the half. Paying for your own offspring would have a powerful effect on baby mothers and multiple fathers.
“The CBI coupled with a tax threshold of £10,000 provides for a massive incentive to work: a marginal tax rate of 0% for each extra hour worked per week.”
But you’ve already tinkered by having a means-tested housing benefit, ie it’s not 0% marginal tax rate. Mark meanwhile is allowing new mothers 1.5 CBIs, and I imagine all this kind of stuff would bedevil any CBI if it was ever introduced (I’m a supporter but we need to realise that it has many drawbacks and pitfalls).
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