Historically, proponents of a UBI tie it to a 'source of funds' (such as tax revenue). Our argument is that the UBI should be a 'source of funds' (via money creation). To understand why, we need to recognise the basic flaw in our current system. This flaw relates to how new money is created and allocated.

Most money is now created when banks make loans. The borrowers then spend the new money into the economy, driving economic activity to meet their needs. This money then circulates through business and government to employees in the form of wages, and other income for investors, providing them with the money they need to survive.

This process is fundamental to how our economy now works. But for most of human history, it worked differently.

Once, it was the birthright of all humans to live off the land. Since the invention of 'money', 'property rights' and 'paid work', this is no longer possible. Now, all people in a modern economy need money to survive.

Most people get money from doing paid work, or borrowing it. However, only around 50% of the population at any time can do paid work (so they can earn or borrow money), the rest must rely on savings, family support, welfare, charity (and crime) to meet their basic needs.

While this system has benefited the huge majority, it has left a substantial minority destitute (12-14% of the population), mainly: kids, the disabled and aged, their unpaid carers, and some between jobs. That's around 3.2 million Australians. This is not a static group: the kids grow up, the disabled age and the aged die, while their carers and those between jobs find other paid work... only to be replaced by a new group.

The problem arises because welfare benefits must be kept below the poverty line to encourage people who can do paid work to take the available jobs. This has the unfortunate side effect of forcing many people into poverty - those who cannot do paid work, who also have no savings or family support.

Looked at this way, 'poverty' is mainly a system problem. The system itself denies a large ever-changing group of people who cannot do paid work for a time, the money they need to survive.

We've invented this system, so we can correct its inherent flaw.

The solution is to also create money to pay a UBI, to restore each person's birthright to access the resources they need to survive. It would avoid the 'poverty trap' by allowing people to earn more to better themselves. It would provide a floor to stand on, not a ceiling to achievement.

The system would then comprise: 'money', 'property rights', 'paid work' AND a 'UBI'.

Our proposal shows how this can be done without increasing taxes or debt, or taking from other programs, or disadvantaging current or future welfare recipients - all with little risk to inflation, the labour market, or adverse behavioural changes.