Budget 2017: National Social Security System For Poor Likely
Providing Rs 1,500 a month to an estimated 200 million poor will cost the government about Rs 3 lakh crore, resources that may be difficult to come by. The debate is between a widely accessible universal basic income that may stretch the social security net too thin and targeting specific groups.
The government is considering an ambitious income transfer scheme that could form the basis of a national social security system though opinion is divided over whether it should be a universal basic income or more focused support limited to the most vulnerable.
The idea is being discussed as a means of addressing poverty and if a decision is reached, it could be announced in the February 1 budget by FM Arun Jaitley.
Providing Rs 1,500 a month to an estimated 200 million poor will cost the government about Rs 3 lakh crore, resources that may be difficult to come by. The debate is between a widely accessible universal basic income that may stretch the social security net too thin and targeting specific groups.
The government is committed to lowering the fiscal deficit to 3 per cent of GDP in FY18 though a committee is reviewing that road map. However, if resource generation rises in the wake of demonetisation and the upcoming rollout of the goods and services tax (GST), the government may be in a good position to back such a scheme.
The target group is said to include unemployed people with no source of income. One idea is to put the money in the hands of the woman of the household so that funds are better utilised.
Some policymakers are confident that Pradhan Mantri Jan Dhan Yojana accounts and the Socio-Economic and Caste Census of 2011 will facilitate a targeted scheme if a universal basic income cannot be provided.
The idea has been gaining ground across the world. Finland recently announced a basic income scheme for anyone seeking employment.
The UK government offers a jobseeker's allowance for the unemployed. Jammu & Kashmir became the first Indian state to commit to the idea of a universal basic income during its budget presentation last week.
The Economic Survey for the current fiscal year that will be released on January 31, at the start of the budget session, is likely to discuss the issue. Cost implications could limit its scope.