An enterprising approach to a basic income

There’s been much discussion about the idea of a Basic Income. This blog sets out a proposal for a version of a universal-payment-for-everyone-at-age-16 which aims to invest in people’s potential in a really explicit way. In particular, it aims to encourage an approach to enterprise, which could generate a range of benefits.

Prince William test

I first came up with this idea many years ago, in response to a challenge from someone that a ‘Basic Income’ would not pass what was described at the time (around 2000) as the Prince William test.

I’m really not sure if the Prince William test is an actual thing — but as I understand it, the Prince William test is applied to all areas of public policy which seek to provide universal benefits of one kind or another. It works like this: the proposed policy idea needs to go through a simple gateway before being progressed at all. The gateway question is this: Will the proposal benefit Prince William? If the answer is ‘yes’ then it is deemed an inefficient use of scarce public resource and should be shelved; if ‘no’, then it is worth pursuing — at least until the next stage.

Basic Income

The Basic Income is an income unconditionally granted to all on an individual basis, without means test or work requirement, and irrespective of any other income received— as elaborated further here.

The concern which was expressed at the time was that the concept of a Basic Income does not pass the Prince William test: Prince William (and anyone else not in need of this additional income) would receive the benefit — and, thus, public money is wasted. Any process of disqualifying people, or enabling some kind of opt-out, would undermine the concept of a ‘universal’ benefit and/or would be administratively burdensome. (There is considerable research on the case for and against a Basic Income, including data from the various versions of the policy which have been implemented in different countries. I have no intention of considering the pros-and-cons of these. Further information can be found on the website cited above.)

Investing in potential

The case I made for a Basic Income was modeled around the idea of investing in everyone’s potential. It relates to a form of Basic Income which involves a one-off payment (at age 16 or 18) to every citizen, rather than a recurring monthly or annual payment.

Based on my version of this Basic Income proposition, everyone would receive a Basic Income (even Prince William) — but when receiving it, the person in receipt of the fund would be asked to say how they propose to use it. This is not an application process: the income/fund would be available to everyone, regardless of the answer to the question — but everyone would be asked the question. It could take the form of a simple on-line tick-box, after which the funds would be paid into a relevant bank account or, as indicated below, directed to some other option.

Delayed income option

Let’s call it a simple choice: instant or delayed gratification — to take the money immediately (in effect, as cash) or to opt to take the money as a form of investment into one of a number of pre-selected options.

The pre-selected options for investment might be: education or training; a business venture; or a charity (the option one would hope that Prince William might choose). And I would also suggest that there is a ‘Don’t know’ (or ‘Don’t know yet’) option, where the recipient could opt to re-direct their one-off income into a high-earning investment account, to be accessed at a later stage.


All of the above could be managed using the highly user-friendly ‘’ site. One can imagine how easy it might be simply to re-direct funds to another part of the same website — for example to ‘student finance’, to the Charities Aid Foundation, or to some kind of charity portal set up specifically for this purpose.

Investing in my business

The neat thing, as I see it, is that the process I have outlined should not add an administrative burden so much as introduce a new incentive for business development. Imagine being told at age 16 (or at age 18, if deemed more sensible) that you are being given a down-payment on your future business ideas — a sum of, say, £15000. Imagine further that there might be a system set-up which enabled you to put that income into a high-earning account and which directed you to a list of other young people in your town that were looking to do the same thing……

Plenty of scope for variations on this and, I hope, a useful contribution to the Basic Income debate.