Using the Opportunity Fund
Our case-studies detail how the Fund could be utilized by a range of people
By Anthony Painter, Jake Thorold and Jamie Cooke
Follow Anthony, Jake and Jamie on Twitter @anthonypainter, @thorold_jake and @JamieACooke
This article is an extract from the RSA report Universal Basic Opportunity Fund: Pathways to Universal Basic Income
The case studies below are fictionalised accounts that consider what the basic opportunity dividend might mean in a number of real life situations (adapted from Thriving, striving, or just about surviving? Seven portraits of economic security and modern work in the UK).
Flexi-worker — Martin, 44
Martin left his job in the public sector around three and a half years ago to start his own business as a self-employed photographer. When Martin was first starting out on his own, he and his partner suffered the loss of their first baby soon after childbirth, which made him more aware of the safety net he had given up when he transitioned away from being an employee.
It was at this point that he decided to take his basic opportunity dividend. There would have been no paid parental or compassionate leave without it and he couldn’t afford to take time out, so would have had to return to work straight away. However, the £5000 each that he and his partner were able to draw down have given them breathing space and enabled Martin to build his business through a difficult time. He now anticipates using the second tranche to fund some targeted marketing to help secure a less volatile income from the business and may even see whether he can train an apprentice to build his business further as a result. The support he was able access through the Universal Basic Opportunity Fund helped them get over a trauma and put their household finances on a more stable setting — paying more in tax in the process.
Steady Starter — Kathryn, 35
Kathryn has been working in local government for the past 19 years. Kathryn’s job on a day-to-day basis involves making calls to follow up with local residents who are in arrears, to work out a way of collecting the council tax owed. While these calls are routine, every day feels different because her interactions with residents will vary. Kathryn regularly feels a sense of accomplishment, especially when she is able to make contact with residents that have been difficult to reach and to support them onto repayment plans.
Recently, the Council has become a verified provider of the opportunity dividend. And it has linked the payment to a ‘work security’ scheme. To residents struggling with their rent, she can help them claim the basic opportunity dividend, take them off Universal Credit temporarily, provide them with access to support for basic skills needed in more secure work sectors including care work, and give them some breathing space. Support of £5000 per member of a household per year for up to two years in ten makes skills development, the management of household finances and obtaining more regular hours on decent pay more likely. It’s a helping hand as Kathryn sees it.
Striver — Adam, 23
After finishing his A-levels, Adam decided to find a job rather than go to university or college. He first started working in a bank, progressing from frontline roles in customer service to an analyst of mobile banking. Around two and a half years ago, he began working for a railway company managing trains. He was drawn to the job because of the employment benefits and opportunity to travel for work.
While he’s not worried about job security right now, he recognises it may be an issue in future. “I don’t think any job is secure. I don’t worry about it on a daily basis, but it is in the back of my mind that this job won’t be around forever.” Adam reckons that automation will affect his industry within the next decade. He comes across a level 4 transportation planning apprenticeship. The pay is quite a bit lower than what he’s on now and probably too much of a stretch. However, he phones up to enquire about it anyway and is reminded that the Basic Opportunity Fund can help support him while he trains. It makes the difference — just a few extra grand a year for a couple of years, and though it’s a three year apprenticeship, that makes it doable as far as Adam is concerned.
High Flyer — Alan, mid-40s
Alan works for a small business specialising in computer sales. He was attracted to the job because of the financial incentive and the opportunity to travel. Alan enjoys a high degree of autonomy in his job, which he values more at this stage in his career. To Alan, having autonomy in work means having independence. “It means deciding what I get to do, which jobs I want to take on, and which contracts and relationships. It’s about having choice.”
Alan decides that it’s time to set up on his own despite the fact that he is supported in his current role. He goes to see a local business adviser who discusses how Alan can use the Basic Opportunity Fund as venture capital — to support his family during an inevitable decline of earnings for a couple of years. The financial support also comes with business advice and support funded by the local LEP (local enterprise partnership). Alan knows that he’ll have to pay a bit more tax as a higher rate tax payer once the two years is up until the basic opportunity dividend is paid back — much like he had to do to pay back his student loans. He’s fine with that. This support makes all the difference while he’s building his new business from the ground up.
Chronically Precarious — Kafui, 34
Kafui works for a clothing and jewellery store in one of London’s busy train stations. She has been a sales associate at the store for the past six years, but has been working in retail for much longer. While studying for a degree in pharmaceutical science, she first held a job as a carer but turned to retail in the hopes that it would be easier to balance with school. Kafui is on a permanent contract, and is paid an hourly wage of £8.30. There are no bonuses or commissions for sales, and staff are expected to regularly purchase discounted clothing to wear to work in an attempt to attract customers.
She looks to balance her hours alongside responsibilities for caring for her child. However, this flexibility and reduced income leaves her struggling to pay the bills, and carrying worries over the economic security of her family. As the sole breadwinner she is responsible for all income, and so variances in her wages can have a huge impact.
Kafui has decided to take her opportunity dividend in order to take up the chance to pursue a Masters. This would allow her to seek new opportunities within the pharmaceutical industry, particularly as her daughter is getting older. She can continue to work at the store during her studies, with the dividend providing her with greater security and flexibility during that period, allowing to her blend studying with fewer hours and more time to fulfil her childcare responsibilities. She sees she dividend period enabling her to transition into a higher earning position, with benefits for her and her family in terms of economic security and mental wellbeing.
Acutely Precarious — Polly, 23
As a care worker, Polly rises early to make it to her first call at 7am. She helps clients wash, dress and take their medication in the mornings and then squeezes in some paperwork before heading home for a break at noon. She eats her dinner and then returns for a second shift from 4pm to 10pm, although she’ll often clock out later. She has been in the job for a year and a half and feels passionate about the work.
Polly is recognised for doing her job well; she has been asked to train new recruits and has been given the opportunity to undertake a paid NVQ in health and social care. However, when asked if she plans to progress, Polly responded, “I don’t see myself staying for long enough to want a promotion. We are under-staffed and underpaid.” She is on a minimum wage and is the sole breadwinner; her partner is waiting for a disability living allowance, but is unsure if it will be granted, so they rely on her income to make a living.
When Polly is at work, she is required to complete her calls, and thus her tasks, within a certain amount of time. She finds that the time constraints are unrealistic, however, and often finishes late. There isn’t enough support from management, nor respect for her time.
Polly is not concerned about job security because the company cannot afford to let anyone go. Yet, job security does not mean economic security for Polly.
Polly uses her opportunity dividend to provide her with basic security as she looks to find a new workplace that is more rewarding, supportive and economically secure. It helps give her support to look for better conditions in her current workplace, with less fear that she will suffer economically. The dividend also allows her additional finances while she completes her NVQ, and support while her partner waits for the decision on their disability allowance. The dividend can smooth the transition process into a new workplace where her skills are better recognised and rewarded, and give her the confidence to make use of what she has achieved in her career and studies. She expects to make a greater contribution, with less stress and earn more in the process.
This article has provided a series of case-studies to illustrate how the Universal Basic Opportunity Fund may benefit a wide-range of people in different circumstances.
We ask why the time is right for Universal Basic Income in another article — Why Universal Basic Income?
To find out more about our research, please contact Anthony Painter
For full references and bibliography please visit the RSA website to download the full report
