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Budget 2021: a Budget for the future of work

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Later today, UK chancellor Rishi Sunak will give his Budget to the Commons. This will spell out many of his key priorities for employment in the UK, including an extension of furlough.  

Ahead of this, in previous weeks, the RSA has won headlines for our work urging the Chancellor to improve the world of work – now and in the future. (And we hope he’s listened!). Here is what we’ve said he should do, now and in the future. 

In the short term, fix sick pay 

Universal sick pay is a missing part of our fight against the virus. 

Our pre-Budget polling found 74% of Tory voters and 81% of Labour voters would like to see more generous sick pay – currently £95 a week in the UK – to cover the whole of a person’s income if they need to isolate. With RSA research finding that one-in-nine insecure workers went out to work within days of a positive test, due to the need to self-isolate, closing the sick pay gap is a big part of our continuing efforts to curb the virus. 

This is especially true of frontline workers. Our research in December found that almost half were at the point of ‘burnout’ - a situation which looks to have gotten worse since, according to the TUC.  

To fund sick pay – and finance a pay-rise for all key workers, especially the overlooked heroes in supermarkets, social care and sorting deliveries – we have suggested an ‘Amazon tax’ on digital sales as well as a ‘windfall tax’ on pandemic profiteers. Unusually for a tax rise, Conservative voters would be even more likely than Labour backers to support this idea. 

We also suggested mandating the Real Living Wage for all key workers (currently £9.50 outside London and £10.85 in the capital). The RSA’s analysis finds that 37% of social carers earn less than the Real Living Wage currently – and a £250 million benevolent fund for those struggling with mental ill-health and personal/family emergencies. 

In the medium term: retraining, retraining, retraining 

As the pandemic (hopefully) subsides, we need to see a huge focus on retraining. Many jobs will have been lost during the pandemic: some, hopefully, will come back, but there are likely to be many that won’t.  

And automation will make the situation worse, our analysis of official jobs data from October found. 

In our Blueprint for Good Work, we set out what we think the social contract of the future should look like, with retraining and lifelong learning at the heart of our plan.  

In particular, we said Job Security Centres – which bring together unions, employers, training providers and others – should replace Job Centres, giving more power to employees. We also think unions should play a key role in the welfare state, even providing benefits directly for their members, as they do in Scandinavian countries.  

In the long term: economic security for all 

Covid-19 has only exposed the frailty of our work and welfare systems. It's time for more security.  

At the RSA, we are cautious, evidence-based advocates of a Universal Basic Income – not because we are a lobby group for the idea, but because we think it’s the only idea of the magnitude to really address economic insecurity and its primary cause: a lack of cash.  

That’s why we’ve been working on pilots in Scotland – where First Minister Nicola Sturgeon is exploring a long-term shift to UBI – and how elements of UBI could be piloted in local English areas. 

Elements of a Universal Basic Income could be introduced now, but there’s no doubt that a fundamental shift from the UK’s system is needed long-term. This is especially true for the self-employed and growing ranks of those in the gig economy.  

For those worried about how to sell it – especially national and local politicians - we've also explored how to engage the public on the debate. Starting from the finding that the public tends to support the scheme by two-to-one, we show how ‘middle England’ and floating voters can be convinced of the idea. (TL:DR, focusing on ‘good work’ rather than a future world with robots is key).  

Obviously, we don’t expect the Chancellor to announce all of this later today. Nor is the responsibility that for the state alone. But we think this represents a good starting point for a better future of work. What do you think? 

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