A Labour MP has pledged to scrap Universal Credit and replace it with a new one-for-all payments system, if his party regains power.
Shadow Chancellor John McDonnell said Labour will introduce a 'Universal Basic Income' system if it wins the next election.
The scheme, which has just completed a two year trial in Finland, will see the current welfare state overhauled and replaced with a single payments policy to address poverty and unemployment.
It would mean an end to fit-for-work tests, an end to assessment periods, an end to means testing and more - benefit sanctions would become impossible.
How could it do this? Simple - it would be paid to everyone whether they were in work or not.
The plan is for a monthly, untaxed payment to give Brits the "freedom" to work, study, create new businesses and care for relatives, alongside "economic security".
However, it would not replace the state pension - in many ways it would be a state pension for all, regardless of your National Insurance contributions or age.
“Of course it’s a radical idea. But I can remember, when I was at the trade unions campaigning for child benefit," Shadow Chancellor John McDonnell explained.
“And that’s almost like UBI. You get a universal amount of money just based on having a child. UBI shares that concept. It’s about winning the argument and getting the design right.”
Here's what you need to know about it.
What is a Universal Basic Income?
The idea behind a Universal Basic Income system is to give every citizen a fixed, untaxed sum to live on, whether they are rich or poor, in work or unemployed.
Under Labour, pilot projects would give everyone in designated areas a certain amount of cash every week – regardless of their income.
This money can then be spent how they like, ie on rent or to start a new business venture.
The underlying idea is that it will be used to study, to become an entrepreneur or to leave work to care for a loved one.
Where would the trial run?
Shadow Chancellor John McDonnell said the Labour Party will trial UBI in Liverpool and Sheffield when it takes power.
Cities earmarked for pilot schemes include Liverpool and Sheffield, the shadow chancellor said.
"I would like Liverpool – of course I would, I’m a Scouser," he said.
"But Sheffield have really worked hard. I've been involved in their anti-poverty campaign and they’ve done a lot round the real living wage.
"I think those two cities would be ideal and somewhere in the Midlands."
McDonnell said: “I’d like to see a Northern and Midlands town in the pilot so we have a spread.
Has it been trialled before?
Yes - but not in England. Scotland is currently exploring the idea of a basic income to help lift people out of poverty and boost entrepreneurship.
The Scottish Basic Income Steering Group was set up in 2017 to assess whether it was feasible in the country - and the consultation will end in 2020.
The Government is currently under pressure to implement - or at least trial - the scheme, which would give every adult an 'initial' £2,400 a year.
It would then give the least well-off (around 20% of households) £20.22 a week, the second least well-off £14.89 a week, and under a tiered system, the fifth worst off will receive £8.28 a week.
The initial amount would be raised to £4,800 over successive parliaments, according to campaigners at the Royal Society of Arts (RSA), which would eliminate destitution in Scotland, which affects around 52,875 households a year.
Finland has also just completed a 24-month trial of the scheme, however its model was slightly different - focusing on those out of work only.
The Finnish Government paid 2,000 unemployed people £490 (€560) a month for two years, instead of unemployment benefit.
The basic income was paid with no strings attached. Recipients weren't required to seek or accept jobs but still received the payment if they found a job. However, it said the findings of the experiment weren't fully convincing.
The largest pilot launched to date is running in Kenya and is funded and implemented by the non-profit organisation GiveDirectly.
It provides a basic income for 21,000 villagers and will be monitored for the next 12 years.
Finland intended to pilot a similar trial in 2017 but was unable to apply the cash to every community and resident.
How much is it?
Different Universal Basic Income models pay differently - it would all depend on how it would be funded.
Under a scheme in the UK, it could be tested in low-income areas, including one in which a whole community gets basic incomes.
All the means-tested benefits – apart from housing benefit – would be taken away and every adult would pocket, for example, £100 per week.
They would also get an additional £50 for each child they have.
However, it could be more than this.
In 2018, campaigners put forward a proposal for the idea of a single payment for all people in the UK.
Rather than a string of different benefits, the Royal Society for the encouragement of Arts, Manufacturers and Commerce (RSA) said it would make sense to give everyone a universal income.
This would be £3,692 a year for all qualifying citizens between 25 and 65, while pensioners would be paid £7,420 over the age of 65.
It's essentially a pension for everyone - at £71 a week - without having to make the National Insurance contributions first.
Then there would be a basic income for children aged 0–4 of £4,290 for the first child and £3,387 for other children aged 0–4.
There would be a reduction for a third child or more, potentially to zero.
This, it said, would be comparable to the benefits available to low-income households before their child begins school.
Once in education, the payments would then fall, as parents would be able to work more hours.
How would it be funded?
Labour has given little insight into how it proposes to fund the scheme under the party's leadership, however the RSA has previously proposed several ways in which it could work.
It's suggested that the policy could be funded by a charge on people earning more than £75,000 a year.
The RSA estimates that removing benefits, tax reliefs and allowances (excluding those relating to disability and housing), the Government would save a total of £272billion.
A Universal Basic Opportunity Fund (UBOF), which would cost around £14.5 billion a year, would, under its model, be funded by either a "modest increase" in taxes on top earners or through levies on large corporations, to create a British sovereign wealth fund.
The report proposed that the Government borrow £200 billion while interest rates are “historically low” to establish the fund, which would be “potentially able to pay itself back through economic growth engendered by investment in human capability”.
RSA’s Action and Research Centre director Anthony Painter said: “The simple fact is that too many households are highly vulnerable to a shock in a decade of disruption, with storm clouds on the horizon if automation, Brexit and an ageing population are mismanaged.
"Without a real change in our thinking, neither tweaks to the welfare state nor getting people into work alone, when the link between hard work and fair pay has broken, will help working people meet the challenges ahead."