Link to the class: “https://www.youtube.com/watch?v=gsMxcNk5kWw”
What is Universal Basic Income (UBI)?
- Universal Basic Income is a periodic, unconditional cash transfer to every citizen in the country.
- Here, social or economic positions of the individual are not taken into consideration.
- The concept of universal basic income has three main features. They are as following:
- UBI is universal in nature. It means UBI is not targeted.
- The second feature of UBI is cash transfer instead of in-kind transfer.
- The third feature is that UBI is unconditional. That means one need not prove his or her unemployment status or socio-economic identity to be eligible for UBI.
Why Universal Basic Income?
- As a form of social security UBI will help in reducing inequality and eliminating poverty. Thus it ensures security and dignity for all individuals.
- As human labour is being substituted by technology, there will be reduced wage income and reduced purchasing power. UBI will compensate for reduced purchasing power.
How UBI works?
- Under UBI, only those with zero income will receive the full benefits in net terms.
- For those, who earn additional income over the basic income, the net benefits will taper off through taxation.
- So even though the basic income is universal, only the poor will receive the full benefits.
What UBI means to the Government?
- There would be drastic changes in the way government spends its revenue generated from taxation and other sources.
- Currently, Government spends its revenue on various services as well as on subsidies.
- UBI would mean that government may move away from service delivery and empower its citizens to access services through cash transfer.