Universal Basic Income

What is universal basic income?

• Universal Basic Income is a form of social security paid to individuals, not households, and it is paid to everyone. That’s how it becomes universal.
• It can be paid in kind (such as food or services) or in vouchers or can be a direct transfer into bank accounts to help reduce leakage.
• The government will offer about $15 a month (1,000 rupees), and only to families below the poverty line (BPL).
• It is paid at regular intervals, say monthly, not as a one-off grant.
• It is unconditional and paid without a requirement to work or to demonstrate willingness-to-work.
• Finland and Scotland are planning pilot runs. Switzerland rejected the plan.
• The virtue of this arrangement, it is claimed, is that it would eliminate poverty and yet leave some over to actually raise public investment.
• UBI is not framed as a transfer payment from the rich to the poor. Its basis is rather different. UBI gives concrete expression to the idea that we have a right to a minimum income, merely by virtue of being citizens.

Three key features of Universal Basic Income

The universal basic income  has three distinguishing characteristics.

First, it is universal and not targeted. How it make sense in Indian context?

• Less-than-satisfactory experience with targeting welfare services.
• it helps people who often fall in and out of poverty which excludes many deserving households from receiving subsidies.
• Reduces the burden of the bureaucracy in identification of deserving beneficiaries.

The second feature of any proposed universal basic income scheme is cash transfer in lieu of in-kind transfer. It is supposed to be less market-distorting than in kind transfers like food.

The third distinguishing feature is that it is unconditional cash transfer. http://43.205.139.81/highlights-of-economic-survey-2017-chapter-9The individuals would be free to use the cash as per their discretion and spend according to their own preferences.

Thus, the movement for a universal basic income has attracted support from both the left and right ends of the political spectrum.

Also read latest Economic Survey 2016-17 Chapter 9 is dealing with the concept of Universal Basic Income.