A roof over your head

As of next year, the Finnish Government is planning to introduce a radical new concept to improve the lives of its citizens: It is proposing that everyone will be paid a universal basic income. 

According to www.inhabitat.com, “When fully implemented, the universal basic income would provide every Finnish citizen with a monthly tax-free payment of €800. This would replace currently existing social benefits received through the Finnish welfare system. Any income earned beyond the basic income will be taxable. The idea comes from the Finnish Social Insurance Institution, also known as Kela. The basic income proposal includes a trial period in which the payment delivered to citizens is only €550 euros, while existing benefits such as housing and income support would not be affected.”

Technically it is not a new idea, because it has already been implemented as a social experiment in the Dutch city of Utrecht to see whether people would become even lazier or whether they would end up doing more productive, meaningful things. Utrecht authorities have teamed up with the University College Utrecht to carry out the research and track the behaviour of the recipients. The theory being tested is, if our living expenses are covered and we have no financial worries, we would be free to do the things we always dreamed of. But would this really work in practice? Or would people simply take the money and stay home all day, ending up as couch potatoes? 

The idea has been shot down by critics who claim it sounds too much like Communism for their liking, and I can see their point. If everyone gets the same monthly sum irrespective of their abilities, what would be the point of striving to study for qualifications or improving your skills? For those who don’t have much ambition to start with, there would be even less of an incentive to get off that couch.

On the other hand, in a world where the gap between the rich and the poor continues to widen, where in the same country you can have obscene wealth on the one hand and people struggling to pay their rent and buy food on the other, it is easy to see why some governments are trying to come up with a new economic model. In fact, the idea is even being discussed in Australia where it is sometimes simply not worth getting off unemployment benefits and finding a job, because the monetary difference is minimal. 

It will be interesting to see the conclusions of the Dutch research, although one also has to bear in mind that there are cultural differences, and what works in one country will not necessarily work in another. Because even though this system of social justice sounds completely fool-proof and there is no way it can be abused, since everyone is receiving the same amount of money, knowing the Maltese knack for ingenuity in these things, I’m sure that if it were implemented here, someone would figure out a way to screw the system.

Meanwhile, following the Caritas report on poverty, the government is finally discussing an important issue for those on the lower end of the income spectrum: raising the minimum wage to better reflect the realities of today’s cost of living. At the top of the list of expenses which are making it impossible for many people to live decently are the exorbitant rental fees which have shot up in the last few years. We tend to forget that while there are many who qualify for social housing and rent subsidies, there are many others who are not quite poor enough to get a flat on a housing estate, but not quite comfortable enough to afford a mortgage to buy their own home.

Sometimes it is because of a broken marriage after which a splitting of the assets leaves one or both parties with not enough to buy a new place, or else it is simply a case of never having saved enough money for a down payment to get on the property ladder. These are the people who slip through the cracks and will have to rent long-term. 

The problem is that what used to be just about affordable, at €300 to €400 per month (and even that made it a tight squeeze for those on a low wage), has become simply impossible as landlords are doubling their prices due to the influx of non-Maltese people who have come to live here, all looking for somewhere to rent.

Apart from those who are in well-paid industries such as iGaming, there are many others whose income may be average, but who are willing to flat-share. This means that property owners are basically renting rooms in order to split the rent, something which is quite common in other countries but which has only caught on recently here. But where does that leave a couple or a family which is obviously not willing to share their accommodation? As things stand, I have heard of people being informed that their rent was going to be raised with only a few days’ notice and it was a question of either take it or move out. 

This situation has led to the suggestion by Yana Mintoff Bland that the government should put a mechanism into place whereby rents cannot be raised by more than 5% of the average in a particular area for the next three years. The lobby group Alliance Against Poverty has backed this suggestion, pointing out that market prices are “pushing families into destitution.”

Unfortunately the surname Mintoff – combined with the word ‘control’ – gives people a bad case of déjà vu, so not surprisingly the idea was shot down by the Labour Prime Minister who knows he is already skating on thin ice with many voters. The last thing he probably wants is to be accused of bringing back state interference, rather than allowing the free market to operate under the principle of supply and demand.

However, the concept of rent-regulated housing is not such a far-fetched idea. In fact, it does exist in other places, for example in New York, where certain apartments which fall under specific criteria, are rent controlled, limiting how much the landlord can increase the rent.

So maybe it would not really be that terrible to at least consider some form of capping on how much rent can be increased, to protect those who are finding themselves being priced out of the rental market and facing eviction.

For, while there used to be a time where rental prices varied according to areas, with the most desirable parts of Malta obviously demanding higher rates than others, so you could pick and choose where to live according to your budget, this no longer seems to be the case.

From what I can see, prices have gone up sky-high across the board, no matter where one chooses to live. This is especially perplexing when one sees such a glut of empty properties, while yet more construction is taking place and average wages have remained at a level which is no great shakes. But as long as they continue to find tenants willing to fork out some €800 for an apartment, property owners are currently holding the upper hand, although it remains to be seen how long these artificially inflated prices will last.

Ultimately, if we are really going to consider ourselves a socially just society we need to start with the very basic right to affordable housing. It would be a refreshing change to start thinking about those who are on the lower end of the economic spectrum for a change, rather than always thinking up ways for those who already have more wealth than they know what to do with, to simply get even richer.

And it is high time the Labour government started living up to its name as a party which is supposed to be looking out for the workers.