Unconditional Basic Income becomes a leading policy idea

Sensemaking / Unconditional Basic Income becomes a leading policy idea

The Unconditional Basic Income (UBI) could become a mainstream policy idea in 2017, with particular relevance for developing countries.

By Joy Green / 25 Jan 2017

With increased trends in automation and the “gig economy” pointing to labour market disruption and uncertainty, the implementation of various forms of Universal Basic Income (UBI) looks increasingly probable. This once-heretical idea of giving all citizens a baseline income that is enough to live on, without requiring anything in return, has acquired sharp relevance – for instance, there is a real prospect that a large section of the US’s working population could lose their jobs nearly overnight with the advent of driverless trucks. Advocates point out that a UBI could facilitate a transition to a humane version of the “gig economy”, while boosting entrepreneurship and civic engagement – and mainstream thought-leaders on both the right and left are pricking up their ears.

Pilot programmes are currently underway in Finland, Canada and… Kenya. Yes, Kenya. The most interesting application of UBI policy is actually in developing countries. A recent UBI pilot in India pointed to multiple benefits when an unconditional basic income is provided to the poor – from increased food security and welfare to higher levels of equity, emancipation, entrepreneurialism and economic activity. And in contrast to expensive rich-country UBI schemes, they are far more affordable, particularly if spending is switched from existing subsidies.

Most of the resistance to trying UBI more widely has been due to the perceived outlandishness of the idea. But as the debate moves rapidly towards centre-stage, UBI is fast becoming a more respectable idea. Could the UBI be a major step towards ending poverty, by providing a floor for everyone? The GiveDirectly pilot in Kenya aims to find out and expects their findings to shape the future of anti-poverty policy.

The UBI has the potential to massively disrupt the development sector in 2017 and beyond – with the figures showing that it would take $80 billion in cash transfers to move everyone above the poverty line, while the world spends almost twice that in global aid every year. With new pilots being announced and policy-makers showing interest in countries from the Netherlands to Namibia, INGOs should watch the developments carefully and consider what it means for their own programming. 

This article was first published in Bond's Development Predictions for 2017 series.

What might the implications of this be? What related articles have you seen?

Agree that UBI has a lot of potential in the developing world. Here's a great piece explaining the concept with different case studies that I highly recommend any interested in UBI, written by Scott Santens: https://medium.com/world-economic-forum/why-we-should-all-have-a-basic-income-7177d5b339ec#.pgeyrj6h4
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The ruling party in Scotland, the SNP, is interested in UBI and it looks like there will be trials conducted soon. http://www.independent.co.uk/news/uk/home-news/scotland-pilot-universal-basic-income-ubi-snp-fife-and-glasgow-scheme-a7505411.html In England the deputy leader of the Labour Party Tom Watson is leading an inquiry into the future of work and I think it's quite likely that it will recommend adopting UBI as a policy in the next Labour Party manifesto. Whether you think that is 'going mainstream' given the state of that party at the moment is another matter...
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In an interesting and timely update to this, it looks like the Indian Government is now seriously considering a UBI. Their Chief Economic Adviser, Arvind Subramanian, has called it 'an idea whose time has come', that merits 'serious discussion'. He notes its potential to reduce poverty 'in one fell swoop' and, more importantly, he thinks the sums add up. The main difficulty he forsees seems to be reaching the unbanked - which is potentially surmountable. See https://www.theguardian.com/global-development/2017/feb/06/india-weighs-return-cash-handouts-poorest-universal-basic-income-arvind-subramanian
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