A Springboard for New Citizens: Universal Basic Capital and a Citizen’s Day

Julian Le Grand

doi:10.31389/lseppr.8

Abstract

In recent years there have been several proposals from academics, think tanks, and politicians for a universal grant of basic capital (UBC) to be awarded to every citizen. There has been one UBC programme that was actually implemented: the British Child Trust Fund, started in 2003 by a Labour Government and abolished by a Coalition Government in 2011. This paper discusses the case for a UBC, focusing attention on its potential for helping young people to attain long-term positive outcomes in several dimensions of life, from employment to health. By looking at the experience of the Child Trust Fund, the paper also highlights lessons for how a UBC should be implemented in practice. It proposes a Citizen’s Day: a coming-of-age occasion, marked by a ceremony at which a substantial UBC is awarded, along with the right to vote. JEL Number: I 13

Highlights

The idea behind a universal grant of basic capital (UBC) is simple
This version of the UBC idea formed the basis of the Child Trust Fund, a policy introduced in the United Kingdom in 2003 but abolished in 2011
The Institute of Public Policy Research (IPPR) has recently returned to the basic UBC idea with their Commission on Economic Justice proposing a ‘universal dividend’: a grant of £10,000 to 25 year-olds financed by the income generated from a sovereign wealth fund [6]

Summary

Introduction

The idea behind a universal grant of basic capital (UBC) is simple. The state makes a one-off grant of a sum of money or other financial asset to every citizen. The grant is made at birth, at the age of majority, or at some later point in their young adult lives.

Results

Conclusion