Davala - Basic Income

Basic Income

Also available from Bloomsbury

The Precariat, Guy Standing

A Precariat Charter, Guy Standing

The Rediscovery of India , Meghnad Desai

Basic Income

A Transformative Policy for India

Sarath Davala, Renana Jhabvala,
Soumya Kapoor Mehta and Guy Standing

Bloomsbury Academic

An imprint of Bloomsbury Publishing Plc

Contents

AAY Antyodaya Anna Yojana

ANM Auxiliary Nurse Midwife

APL Above Poverty Line

ASHA Accredited Social Health Activist

AWW Anganwadi Worker

BPL Below Poverty Line

CCT Conditional Cash Transfer

DBT Direct Benefit Transfer

FES Final Evaluation Survey

HIV/AIDS Human Immunodeficiency Virus/ Acquired Immuno-Deficiency Syndrome

ICDS Integrated Child Development Scheme

ID C ard Identity Card

IES Interim Evaluation Survey

LKG Lower Kindergarten

LMP Local Medical Practitioner

MGNREGS Mahatma Gandhi National Rural Employment Guarantee Scheme

MPUCT Madhya Pradesh Unconditional Cash Transfer Pilot

NBA Nirmal Bharat Abhiyan (Total Sanitation Campaign)

NCAER National Council of Applied Economic Research

NSS National Sample Survey

PDS Public Distribution System

PFES Post-Final Evaluation Survey

PHC Primary Health Centre

PL Poverty Line

RBI Reserve Bank of India

R s . Rupees

SC Scheduled Caste

SEWA Self-Employed Womens Association

ST Scheduled Tribe

TB Tuberculosis

TVCT Tribal Village Cash Transfer Pilot

TV-FES Tribal Village Final Evaluation Survey

TV-IES Tribal Village Interim Evaluation Survey

UKG Upper Kindergarten

UNDP United Nations Development Programme

UNICEF United Nations Childrens Fund

UPA United Progressive Alliance (Congress-led coalition government)

WHO World Health Organization

Note on statistics in text

Most statistics from the evaluation surveys that are cited in the text are rounded to the nearest complete number, with the exception of values that are half (.5), which are rounded to the nearest one decimal point. All statistics are given to one decimal point in the report to UNICEF cited in the text as Jhabvala et al., 2014.

The main proposition underpinning this book is that a modest basic income, paid monthly in cash, individually and without conditions, would be a means of achieving three development objectives that taken together would be transformational .

Although we believe that a basic income along these lines is affordable and technically feasible, we do not go into the arguments in any depth in this book. Resolving those issues is for other occasions, and will depend ultimately on political decisions on priorities. All we set out to do in this book is assess the results of what has been in several respects a unique experiment or set of pilots.

As far as we are aware, there has been no pilot anywhere that has considered the impact of a basic income cash transfer and a collective organization, both separately and in combination. The reasoning behind the decision to design the pilots in this way was that the positive effects of a basic income would be enhanced if a collective body was operational in the community at the same time.

In total, about 6,000 men, women and children in nine villages in Madhya Pradesh received a basic income, most paid every month for about a year and a half. Many opened bank or cooperative accounts for the first time. The exact figures and the methods used are described in the course of the book. The point here is to emphasize the three complementary development objectives.

Any social policy should be assessed by whether or not it contributes to the recipients personal development, that is, their well-being or welfare, by whether or not it contributes to economic growth in a sustainable way, and by whether or not it contributes to emancipation, that is, personal and societal freedom. And in doing so, any social policy should be assessed by ethical principles, which are defined in .

It is our contention, first, that a basic income has the potential to promote a substantial improvement in welfare, and is therefore consistent with the best traditions of Indian policy since 1947, however patchy actual achievements in practice might have been. Improved welfare means improved living standards, in health, access to healthcare, sanitation, schooling, nutrition and so on. And it should mean most improvement for the most disadvantaged and improvement for communities as well as for individuals.

However, a policy of this kind should not be judged or assessed solely or even predominantly in terms of welfare. It is the underlying hypothesis that a basic income could also contribute powerfully to growth, by raising productivity, incomes, and work and labour. As such, it would be wrong and unfair to describe it as simply a welfare policy, to be contrasted with alternative uses of spending that might be presented as promoting economic growth. It is a growth-enhancing measure in its own right, and one that would be beneficial for ordinary Indians of all social categories.

The conventional juxtaposition of welfare and growth is too crude, and should be avoided. The contention is that a basic income would be a means of stimulating economic production, raising the quality and quantity of work, and doing so in an inclusive, sustainable and relatively equitable manner.

The third aspect of social policy tends to be overlooked in societies where the privileged are materially and psychologically distant from the disadvantaged. Great inequalities of wealth, income, status and opportunity invariably produce disdain by the privileged for the plight of the disadvantaged and vulnerable. The proposition that unfolds through the following is that a basic income is emancipatory.

It is a means of enhancing and in some cases reclaiming personal freedom, particularly of women and those who normally receive lower priority in social policymaking, including all those with disabilities and the elderly. For some, it is a means of reclaiming a degree of freedom that they had lost years ago. This is the case with the notorious naukar system, the pattern of debt bondage prevalent in Madhya Pradesh.

The several forms of emancipation are diverse, and are both individual and collective in character. Freedom evolves through the actions of structurally free people, so the emancipatory effects comprise a powerful argument for moving in the direction of a basic income, a road to be taken. Another way of looking at it is that any policy that is not emancipatory in some ways should be shunned.

Taken together, policies that promote personal development, growth and emancipation are, potentially at least, transformational. The idea of transformation encompasses a surge of hope, at the level of individual women and men, at the level of families and households, and at wider levels of community.

Transformation means setting a new course with different structures of decision-making and different types of aspirations and expectations. It means altering states of mind as much as material conditions, altering consciousness of what is possible and what is desirable, and defining anew what is normal.

Social policies also operate in several time dimensions. The pilots that are the core of the book were time-bound, for practical reasons. So are all pilots. So it is sensible to be aware of the limitations and the dynamics that such experiments invariably entail. An impact on some spheres of behaviour and some attitudes may be almost immediate. Others take time to unfold. Effects on some attitudes may take quite a long time. In some cases, a short-term effect may wear off. In others, an effect may be shown for a few individuals or families, leading to demonstration effects, whereby others copy or even surpass those early pioneers.