UK universal basic income possible at 2010 spending levels - think tank

Universal basic income could be achieved in the UK at the same level of benefit spending seen in 2010, according to a report from the Compass think tank.

Tax-free payments of £60 could be paid to every adult, with £175 for those over 65 and £40 for each child under 18, the Compass report suggested, would cost roughly £28bn. This level of spending would be equivalent to levels before the austerity cuts began under David Cameron's coalition government.

The scheme would improve funding for a citizens wealth fund, the report also suggested, which could become a growing source of finance to gradually improve basic income payment levels, ensure durability of basic income scheme and help deliver an anti-poverty social security system.

The gains of the program would mainly go to the poorest sector of the country, balancing out inequality.

Overall, 75% of households would benefit from the changes, except for the richest 25% who would lose money, the centre-left thinktank said.

According to the plan, child benefit and the state pension would be scrapped, with the UBI rendering it redundant. Although, most other elements of the benefits system would remain.

The report comes a week after the launch of a similar plan from the New Economics Foundation (NEF) suggesting the government scrap the personal tax allowance and replace it with a cash payment of £48 a week.

NEF also recently calculated that the government's austerity policies since 2010 have left the UK economy £100bn smaller.