The Opportunities Party proposes $250 per week universal basic income

The Opportunities Party is proposing giving all New Zealanders $250 a week as part of a policy that includes a universal basic income (UBI).

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TOP Leader Geoff Simmons has launched a policy that includes a universal basic income. Source: 1 NEWS

As the economy continues to take a hit as a result of Covid-19, the idea of a UBI is gaining traction both here and overseas.

TOP leader Geoff Simmons told TVNZ1's Breakfast this morning it was a simple idea, which means parents, students and anyone else who doesn't get welfare would be entitled to the package.

TOP is proposing a UBI for both adults ($13,000 annually) and children ($2,080 per child annually), a 33 per cent flat tax on all income and to phase in a risk-free return method (RFRM) tax on assets. 

The party's pitch is about making the nation's tax and welfare system "modern, simple and fair".  

"People who are getting more than that ($250) keep that, but yeah, the real winners out of this are those who are earning because they don't lose the benefit as they earn," Mr Simmons said.

"Everyone is rewarded for effort."

Coupled with a flat rate income tax of 33 per cent, TOP reckons it would leave every working New Zealander with at least $3,920 more in their pocket after tax and full-time minimum wage earners would be $6,285 better off.

The UBI would also allow people to take on additional work without it affecting their entitlement, unlike the Jobseeker allowance, the abatement of which arguably discourages them from working and traps them in poverty, Mr Simmons said.

"You bring in a UBI plus a flat tax rate and it still is a very progressive system but it hugely simplifies our tax and welfare system," he said.

Breakfast host John Campbell asked if New Zealand's richest being entitled to more was a flaw in the scheme. In response Mr Simmons said the party was proposing an asset tax to "make up the difference in this costing".

"People on very high income would be paying more through that, the wealthiest New Zealanders would be paying more through that," he explained.

"This will massively simplify our tax and welfare system, could potentially make everyone better off."

In late March, Finance Minister Grant Robertson told RNZ he was considering a form of UBI, one likely to be a very time-limited payment scheme.

"We're obviously going to be in a situation where a large number of people are going to be relying on income support from the state for an extended period," he said, amid the coronavirus pandemic. 

Mr Simmons said the more people come into touch with the welfare system, the more they find out how punitive it is though.

"Our whole labour force is changing and this is why UBI is gathering such steam. Robots are taking jobs, wholesale around the world, the job market is becoming increasingly disrupted. Covid is just bringing that impact forward, we're just seeing it happen faster.

"All the people who don't get benefits at the moment - parents looking after kids, caregivers, volunteers, students, people trying to start businesses - all those people would get the UBI."