Experimenting Unconditional Basic Income in India Evidence from SEWA’s Pilot Study

1. Experimenting Unconditional Basic Income in IndiaEvidence from SEWA’s Pilot Study

2. What is SEWA? SEWA is a trade union of women workers in the informal sector

3. About SEWA

4. Location of Madhya Pradesh where the Basic Income experiment was conducted

5. Why is SEWA interested in Unconditional Basic Income? CLOGGED PIPES and Poor delivery of Welfare

6. Why is SEWA interested in Unconditional Basic Income? • Provides an income to invisible and unpaid workers who contribute to economy – women, children, disabled and old people working at home • Cost-effective. To reach one rupee to poor, India spends Rs. 3.65 in administrative costs. (India Planning Commission figures) • Most efficient method of delivering welfare. No leakages • Enhances liquidity of the poor households: liquidity increases consumption of food, regularity of medicines and reduces small borrowings. • Stimulates local economic growth • Allocation Vs Utilization ratio of Government social spending will be very high

7. Why Unconditional? • Conditionalities are the biggest obstacle to the welfare reaching the intended beneficiary • Eliminates delays, long procedures, middlemen and corruption at the delivery end. • Global research showing that Conditional CT, if they succeed at all, can achieve narrow objectives, but Unconditional CTs have much broader impact on the development needs of people in the long-run. • Conditionalities are difficult to implement. They leave all the discretion in the hands of the bureaucracy.

8. SEWA’s Unconditional BI Experiment Main Features

9. Main Features

10. Amount Transferred

11. Profile of Beneficiaries

12. This presentation will concentrate only on findings of the Tribal Study

13. Tribal Villages in the Experiment

14. Tribal Village Economy and Cash • substantial part of economic transactions are barter and non-cash in nature • Workers often get paid in grain. • Local grocery shops accept wheat or corn in place of cash • Some occasions where cash is a big necessity are weddings, ritual ceremonies, medical emergencies, food emergencies, and lately the payment of school fees, etc. • Extreme scarcity of cash; when households borrow cash, it is at interest rates ranging from 2 % to 10% per month. • Often big debts are repaid through labour which is when it becomes bonded labour; employment in brick-kilns

15. Barter Transactions Ice-cream Seller in the village

16. Agriculture – the main occupation

17. Combined with wage labour

18. Also livestock -rearing

20. The Research Study • Baseline, Midline and Endline • Modified Random Control Trial Methodology • 100 Case-studies (tracking families and village communities over 18 months)

21. Main Findings of the Study

22. Significant Effects of Unconditional Basic Income on Households • Work and Employment: shift from Wage Labour to Own Farming • Reduction in Small Borrowings • Livestock : Increased substantially • Bought medicines more regularly • Food and Nutrition: Eating better • House Repairs and new houses constructed

23. Wage Labour vs Own Farming Baseline BI Endline BI Baseline Non- BI Endline Non- BI Shift in proportion of time spent on own farm vs as wage labourer

24. Livestock Increased Substantially Non- BI village BI Village Increase in the total number of small livestock (fowl & goats) Source: Tribal 3 surveys Jan and June 2012, and Jan 2013

25. Increase in Food Sufficiency

26. Increase in Food Intake Increase in percent Non- Cash Transfer Cash Transfer Food Item Source: Tribal End line Jan 2013

27. Reduction in Debt Source: Tribal Interim Evaluation Survey 2012

28. Reduced Dependence on Money-lenders percentage Non- Cash Transfer Cash Transfer Main source of financial support during crisis

29. Source: Tribal Survey 2012-13

30. Regularity of Medicines Improved Non- Cash Transfer percentage Cash Transfer

31. Housing Non- Cash Transfer Cash Transfer Source: Tribal FES January 2013

32. Draupadibai’s New House: Pooling of money within families • -Draupadibai has 4 girls and 1 boy. Each month she received Rs.1350 which included her husband’s money too. Her husband works in a brick-kiln as a bonded labourer. • -Three months after Basic income transfers began, the family decided to build a new house on their farm near the pond. Before that they were living in a hut far away from the village in the forest. • -On the whole they spent about 15,000 rupees. They had saved 3000 rupees from the Basic Income money and started the work. Three of her husband’s relatives (masons) stayed with them for 2 weeks and helped them construct the new house. • After the masons did the basic structure and the roof, she and her husband did all other work. After that my husband went away to work in a brick kiln. • She did the entire plastering outside on her own slowly.

33. Village Level Changes • Fishermen’s cooperative • Transportation: Tata Magic comes to the village everyday • Two New Shops • Collective decision taken by the entire village to contribute 100 rupees from each family for marriage ceremonies in the village • Collective decision not to use pond water for irrigation in order to save it for the cattle

34. A new Fishermen’s Co-operative started in the village

35. A newly renovated house

36. Fish is easily available in the village

37. Tata Magic that goes to Mhow began to come everyday

38. One of the two new shops

39. Basic Income can be a powerful tool to minimise poverty

40. It can be a means of providing economic citizenship to the marginalised: unpaid, underpaid and invisible labour

41. Unconditional Basic Income is not just a welfare story or a poverty-alleviation story But it is a Growth Story too

42. Thank you