Speenhamland System of Basic Income

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Reading Notes from Michel Bauwens, 2005.


1. Patrick Dieuaide and Carlo Vercellone, 29/10/04 in Multitudes Online:

System of wage support for rural villagers at the end of the 18th cy in England, which is discussed at length in Karl Polanyi's Great Transformation, and by Yann-Moulier Boutang in his history of the salariat.

It was initiated at the time of the Second Enclosure Movement, which was destroying subsistence farming, creating misery, and causing rural revolts.

The support was organized under the control of the parish, indexed to the bread price, and it funded the difference between the wage and the survival needs.

It distracted the farmers from the protection of the commons, destroyed earlier protections, made them dependent, and created a vast pool of cheap labour. It was deducted from their salaries.

2. From the Wikipedia:

"The Speenhamland system was a form of outdoor relief intended to mitigate rural poverty in England and Wales at the end of the 18th century and during the early 19th century. The law was an amendment to the Elizabethan Poor Law. It was created as an indirect result of Britain's involvements in the French Revolutionary and Napoleonic Wars (1793–1815). The system was named after a 1795 meeting in Speenhamland, Berkshire, where local magistrates devised the system as a means to alleviate the distress caused by high grain prices. The increase in the price of grain may have occurred as a result of a poor harvest in the years 1795–96, though at the time this was subject to great debate. Many blamed middlemen and hoarders as the ultimate architects of the shortage.

The Speehamland scale read, "When a gallon loaf of bread cost one shilling:... every Poor and Industrious Man should have for his own Support 3s weekly, either produced by his Family's Labour, or an Allowance from the Poor rates, and for the support of wife and every other of his Family 1s 6d.... When the Gallon loaf shall cost 1s 4d then every Poor and Industrious Man shall have 4s Weekly for his own, and 1s and 10d for the Support of every other of his Family. And so on in proportion as the price of bread rises and falls."

The authorities at Speenhamland approved a means-tested sliding-scale of wage supplements in order to mitigate the worst effects of rural poverty. Families were paid extra to top up wages to a set level according to a table. This level varied according to the number of children and the price of bread. For example, if bread was 1s 2d (14 pence) a loaf, the wages of a family with two children were topped up to 8s 6d (102 pence).

The first formula was set at a time of high prices and possible over-charging, minimum wage inflation was deliberately muted compared to price rises. If bread rose to 1s 8d (20 pence) the wages were topped up to 11s 0d (132 pence). In this quoted example in percentage terms, a 43% price rise led to a 30% wage rise (wages fell from 7.3 to 6.6 loaves).

The immediate impact of paying the poor rate fell on the landowners of the parish concerned. They then sought other means of dealing with the poor, such as the workhouse funded through parish unions. Eventually pressure due to structural poverty caused the introduction of the new Poor Law (1834).

The Speenhamland system appears to have reached its height during the Napoleonic Wars, when it was a means of allaying dangerous discontent among growing numbers of rural poor faced by soaring food prices, and to have died out in the post-war period, except in a few parishes.[5] The system was popular in the south of England. William Pitt the Younger attempted to get the idea passed into legislation but failed. The system was not adopted nationally but was popular in the counties which experienced the Swing Riots during the 1830s." (https://en.wikipedia.org/wiki/Speenhamland_system)