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Universal income

Universal Basic Income will ensure that no one will sleep hungry. If properly implemented, abysmal poverty will be history. More importantly, Universal Basic Income will restore the human dignity of the poor who have to queue up and face awkward questions for each and every Government benefit they receive

Devendra Saksena | New Delhi |

Universal Basic Income
Devendra Saksena

Reservation is like the proverbial tiger, easy to mount but almost impossible to dismount. With more and more castes clamouring to join the reservation bandwagon and the castes already enjoying reservation determined to prevent their entry into the charmed circle, the Government faces a dilemma of imponderable dimensions. Add to it the opposition of the ‘general’ castes to the very idea of reservation (with its attendant privileges) and you have a sure-fire recipe for social strife.

Introduced as a temporary measure at the time of Independence, reservation appears to have become a permanent fixture, much resented by those out of its purview. The sequence of events after the recent Supreme Court judgment in the Bhaskar Karbhari Gaikwad case are illustrative of the deep-rooted divisions brought about by reservation.

First, the facts of Gaikwad’s case. Gaikwad, who was from the Scheduled Castes, was working as a storekeeper in 2006, when his seniors recorded an adverse confidential report against him. He promptly lodged an FIR against his seniors alleging that the adverse remarks were made not because of lack of performance but because of his caste.

Ten years later Gaikwad lodged another FIR naming senior officers who had not acted on his first complaint. The case travelled up to the Supreme Court which held: a) If a complaint is registered against a person under the Scheduled Caste and Scheduled Tribes (Prevention of Atrocities) Act, 1989 (Atrocities Act), a preliminary enquiry should be made within seven days; b) The accused should not be mandatorily arrested till completion of the preliminary enquiry; c) If the accused was a Government Servant, it would be mandatory for the police to seek permission from a superior officer for the arrest of the person. If the accused was not a government official permission from the SSP would be required for making an arrest under the Atrocities Act; d) Anticipatory bail could be granted at the discretion of the court for offences under the Atrocities Act.

All hell broke loose as Dalit organisations called a Bharat Bandh against the Supreme Court’s judgment; dozens lost their lives and public property was vandalised. Thereafter, Dalit organisations and Dalit MPs practically blackmailed the Government into amending the Atrocities Act to nullify the Supreme Court verdict. In retaliation, on 6 September, non-Dalits organised a Bharat Bandh against the amendments in the Atrocities Act, which again disrupted normal life and caused damage to public property.

The political class has to take the entire blame for this sorry state of affairs. All political parties speak with a forked tongue, voting for reservation in Parliament but organising protests outside. One can understand their compulsions; they have to please both Dalits and non-Dalits but, in this process, they have fragmented Indian society.

Reservation in education, jobs and legislature has definitely improved the status of SCs/STs, but the majority of SCs/STs still live in abject poverty; it seems that few have cornered most of the benefits, passing on their affluence and power to their progeny.

Again, despite the rigorous provisions of the Atrocities Act, brutalities on SCs and STs continue unabated, with an overwhelming majority of cases under the Atrocities Act being dismissed or settled by compromise.

Cases under the Atrocities Act are not pursued seriously by the Government; for example, the trial in the much-publicised Una Case has just begun i.e. two years and three months after the crime was committed.

Reservation for Other Backward Castes (OBCs) is a still more contentious issue, which many see as benefiting middle income castes. Friction against OBC reservation also emanates from the belief of other intermediate castes like Jats, Gujjars and Patels that they too deserve reservation. The left-out castes have often agitated to be allowed to enter the hallowed portals of reservation with the existing beneficiaries doing their best to keep them out.

On their part, OBCs contend that reservation of 27 per cent granted to them is inadequate because according to the 1931 Census OBCs constitute 52 per cent of the total population.

Caste-related statistics have such a huge potential for mischief that the Government has not released caste-related data from Census 2011, even after seven years.

Perhaps, the time has come to appraise the extent to which reservation has helped its intended beneficiaries and whether something more needs to be done to better the lot of the deprived sections of society. Universal Basic Income, which guarantees to each individual a minimum income that is sufficient to provide basic goods and a life of dignity could be a powerful instrument to reduce inequality in our society. Universal Basic Income is like a Fundamental Right, unconditional and universal: it requires that every citizen should have a right to a basic income to cover their needs. Universal Basic Income would mean providing support in the form of cash transfers so that each individual gets the wherewithal to purchase goods of his choice.

A number of objections can be raised vis-à-vis Universal Basic Income. It could be said that Universal Basic Income would reduce the incentive to work and make workers lazy. Even Gandhiji had said: “If I had the power I would stop every Sadavrata where free meals are given. It has degraded the nation and it has encouraged laziness, idleness, hypocrisy and even crime.”

However, it cannot be assumed that people would stop working if they had a guaranteed small income. Rather, the deprived sections would get some much-needed capital which they could use for generating more income.

Another objection that could be taken is that given our vast population, the cost of implementation of Universal Basic Income could be too high. A back of the envelop calculation shows that this may not be true.

Union Budget 2018 has allocated approximately Rs 12 lakh crore for about 1000 central sector and centrally-sponsored subschemes in India, accounting for more than 5 per cent of our GDP.

If State schemes are also considered, the number of schemes and expenditure would be still larger. Taking the number of the desperately poor at 30 crore (the official figure is near 25 crore) and the per capita Universal Basic Income at Rs.30,000 per year, we can replace most of the schemes by direct cash transfers, still leaving about Rs. 3 lakh crore for other essential schemes. Universal Basic Income will ensure that no one will sleep hungry. If properly implemented, abysmal poverty will be history.

More importantly, Universal Basic Income will restore the human dignity of the poor who have to queue up and face awkward questions for each and every Government benefit they receive. Universal Basic Income will also plug the leakages and corruption which have become endemic to all Government schemes. It may also be appreciated that most of the central sector schemes have been running for at least 15 years and half of them have completed 25 years without substantially achieving their stated objectives.

The concept of Universal Basic Income was first mooted in the 16th century by Sir Thomas More in Utopia. It was picked up in the 18th century by Thomas Spence in England and Thomas Paine in America. A variant of Universal Basic Income is in operation in Alaska for the last 40 years with encouraging results. However, in a referendum held in 2016, the Swiss rejected the concept of Universal Basic Income. Finland implemented Universal Basic Income in 2016 but withdrew it that year itself. Our Economic Survey for 2016-17 had discussed Universal Basic Income in a forty-page chapter, but that is the last we heard about it.

With Jandhan, Aadhaar and Mobile (JAM) in place, there would not be much logistical difficulty in implementing Universal Basic Income but a consensus would be required and much groundwork would need to be done. All stakeholders would have to be taken on board and a scheme acceptable to all would have to be hammered out. However, the result would justify the effort because once the poorest of the poor are taken care of, much of the friction in our society would disappear. With a slightly more level playing field, we could deliberate on the future of reservation so that in future, reservation is implemented in a way that will reduce social inequality and yet moderate the social conflict brought about by reservation.

The alternative is frightening.

Left unattended, inequalities combined with a perceived sense of deprivation would permanently fragment our society and the Gandhian ideal of a casteless and classless society would never be realised.

(The writer is a retired Principal Chief Commissioner of Income-Tax)