Guy Standing and Ian Orton
12. Concluding reflections
The state of debates on cash transfers as development policy, and basic income in particular, is at a fascinating and fertile stage. At around the time this paper was being written, the parliament of Mexico City issued its new constitution committing it to introducing a basic income.
Shortly afterwards, the Finance Minister of the Indian State of Jammu and Kashmir issued his budget, in January 2017, announcing his intention to phase in a basic income; it may be targeted but his rationale was clear. The Federal Government was contemplating doing so at national level, and issued its annual Economic Report, tabled alongside the Budget at the end of January, 2017, in which a special chapter discussed the pros and cons of a basic income.
There may be a long way to go, but the very fact that a central government of the biggest country in the world is considering it testifies to a new legitimacy. The Indian Finance Minister shortly afterwards stated that within a year more piloting of a basic income would be undertaken.
The momentum behind basic income continues to gather pace and grow exponentially elsewhere too, with a significant national pilot in Finland organised by its national social insurance institution KELA, currently underway Pilots in Utrecht and Ontario are afoot, and there has been significant deliberative consideration of the proposal with the national (failed) referendum on the adoption of a basic income in Switzerland in 2016.
The scholarly debates over the past two decades have settled some issues, raised others and left a few in a stated of unresolved controversy. Conditionality has had a relatively ‘easy ride’, partly one suspects because economists have been fascinated by the intellectual challenge of doing sophisticated econometrics on fancy pilot designs.
But conditionality ultimately is unacceptable on moral grounds; it is paternalistic and erodes personal freedom. It is not acceptable for economists involving themselves in conditional policies to raise their hands metaphorically and say that the moral and ethical issues are not their concern.
Targeting is surely discredited beyond redemption. All forms of targeting have been found to be costly, inefficient, inequitable, usually regressive and subject to stigma and high levels of exclusion and inclusion errors, among their other drawbacks. Universalistic schemes have been shown to be more effective in reducing poverty and inequality, and more potentially transformative.
In general, recognising that cash transfers can also build resilience to shocks of vulnerable individuals and communities, by improving the health and nutritional status of children, and connecting families to government services and community support services in stronger ways, they have become central to development policy. But universal schemes do all of this more effectively than targeted, conditional schemes.
Basic income as a policy must be integrated more systematically in strategies to respond to natural disasters, economic crises and the aftermath of wars and incidents of civil strife. There has been real progress in this direction. There is now almost a consensus that this is the way to accelerate recovery from the almost-daily horrors that afflict the 21st century.
Finally, it is clear from a review of the many evaluation studies and pilot designs that certain topics have received far more attention than others. Thus, understandably, we know much more about the impact on income poverty, and also on the links to nutrition, health and schooling, than on more intangible effects such as freedom. There has also been less attention to those with disabilities, and to vulnerable ethnic minorities, than to women with children. What evidence there is on all these issues and groups is remarkably clear. Universalistic cash transfer schemes work.
Endnotes
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