OPINION: Labour is flirting with a "universal basic income" – a radical and intriguing idea that is having a moment in several countries around the world.

There are plenty of questions about such a policy, but it merits a close look. It is also a sign that the Opposition is not all grim poll numbers and populist witterings, but that it is looking to produce bold ideas.

On the other hand, Labour is only "considering a limited trial of a universal basic income-type system in a town or region". (Count the qualifiers there). Perhaps Gareth Morgan, who backs a similar model, is right to say, in his blunt way, that Labour will not "have the balls" for such a big change.

Prime Minister John Key, for his part, is certainly wrong to call the idea "barking mad" and to give it a $38 billion price tag. That is just absurd gamesmanship – the cost of the policy depends entirely on its details, which can vary greatly. Various Right-wing heroes, including the economist Milton Friedman, have endorsed a version of it.

What is a universal basic income? In a nutshell, the idea is that all adults get a regular cash payment, perhaps around $200 a week. These usually replace most of the current welfare apparatus, as well as the pension. To balance the ledger, everyone pays a higher, flat rate of tax on income – the usual estimate is around 30 to 35 per cent. Morgan's model also included a tax on capital, including the family home.

Why do this? What would it achieve? For many people in work, the effect could be minimal – the two sides often more or less cancel each other out.

But Labour, and a growing cadre of international experts, fear that technology is beginning to threaten a much greater proportion of the workforce, much more frequently, than it has done before. A guaranteed income would be a lifeline for those cast out of such jobs.

The change would also remove the "tax trap" for those at the very bottom – the reality that benefit levels taper off as people get into work, leaving them barely better off. Under the guaranteed income model, it's always worth taking on a few more hours. The shaming and punitive work-testing aspects of the dole disappear too.

A minimum income would recognise the value of domestic work: parents at home would, along with everyone else, receive the payday. It might also encourage innovation by giving entrepreneurs a small safety net while they try a new venture.

All of that adds up to something, but it isn't enough to be convincing yet. The questions around a universal income are serious. The fiscal cost is one. The political hurdles are another – a reduction in the pension, say, would be hard to justify as well as electoral dynamite. Whether devastating technological upheaval is really coming is also in doubt – people have been afraid of that for centuries, remember.

The effect on the poorest is crucial too. Economist Brian Easton has written that, with a universal income, either "the required tax rates are horrendous or the minimum income is so low" it won't eliminate poverty. If that's the choice, it's no choice.

Labour deserves some credit for starting a useful debate. But if it wants it to go any further, the party needs to get beyond the "dole for everyone" caricature and prove that the serious critics have it wrong – that there's a feasible way to really make it happen.