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Governments Asked to Guarantee Income - 2002-09-12

Governments are being called on to guarantee income for their citizens to live on, as a substitute for current welfare programs. Experts at a United Nations sponsored meeting in Geneva support minimum income plans.

The experts say the problem with traditional welfare is it keeps people trapped in poverty. They say they are not working. They point to a survey of 19 industrialized countries that shows welfare protection fell in 15 nations in the 1990's.

Guy Standing is the chairman of the Basic Income European Network, the group that organized the U.N. hosted conference. As bad as the welfare situation is in many Western countries, Mr. Standing says people in developing countries are even worse off. "Something like nine out of 10 people in developing countries do not have entitlements to any state benefits," he said. "And, what we find is that only a little over two percent of GDP [Gross Domestic Product] is spent on social protection in such countries."

Under the basic income system, everyone would receive an income - not just the poor, as in welfare programs. But people with higher income would pay more income tax. Backers of the basic income system say it would be far simpler than existing welfare programs and would pay for itself because it would involve much less bureaucracy.

Supporters of the basic income proposal say a number of projects guaranteeing individuals a minimum income have proven to be successful. Mr. Standing points to one such project in the U.S. State of Alaska. "The Alaska Permanent Fund which was introduced on a very small scale in 1976, but which has grown to the point where now, it provides every resident of Alaska with some thousands of dollars each year and each year it builds up. And they get that as a right," said Guy Standing.

Mr. Standing cites another example in Brazil where he says women are given money on the condition they send their children to school. "The evidence is very strong," he said. "It reduces female poverty. It increases child school attendance. It increases the educational performance of children. It reduces child labor and most unexpectedly, in a sense, is that it has resulted in an increase in female labor force participation. In other words, an increase in female employment."

Mr. Standing says there is little evidence of so-called lazy people stopping work if they receive a basic income. On the contrary, he says many surveys show people want to work and having a small income motivates them to seek jobs to their liking. More than 200 policymakers, academics and other experts from 28 countries are attending the three-day meeting at the International Labor Organization, the U.N.'s labor agency.