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).

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.

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.

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.

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, 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.

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.

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.

The administration of benefits is a world in which affairs are arranged to suit the convenience of the administrators of benefits.