The cost of providing Universal Basic Income is too expensive, thus even if it is anticipated to reduce the burden on healthcare services and social institutions, its ability to serve its intended purpose is in danger due to cost growth.
Basic income, also known as universal basic income (UBI), is a recurring cash transfer made to every person of a nation or territory, regardless of their resources, income, or employment status. It is an action made to combat poverty and narrow the income gap that currently exists in a nation. Each Universal Basic Plan is unique according to its size or structure. This acts as a safety net by boosting work-related wages. It achieved enormous popularity in 2017 and is the most ambitious social policy. There is a lot of uncertainty about this plan. While some see it as a replacement for welfare, others simply see it as useful in conjunction with the current programs.
The pros of the scheme
Laborers who have a guaranteed salary are more likely to advance in their careers or return to school to further their education and develop their abilities.
The advantages of current social programs are currently obscured by a large number of officials and bureaucrats. As a result, the needed aid cannot be provided to the actual recipients. However, with a single fixed sum, the complexity of the processes will decrease and all advantages will be given to the person directly.
Many things are necessary for the economy to function but are not considered economic activities. These efforts will receive acknowledgment if there is a basic income.
A guaranteed income promotes people’s mental health by reducing the stress brought on by financial uncertainty, poverty, and scarcity.
The cons of the scheme
More money than the actual amount will be needed to provide a basic income. So choosing the ideal UBI level will be difficult.
As people will view this income as extra and not use it optimally, there is a chance that the use of alcohol and tobacco may rise.
A free income would significantly decrease the amount of voluntary work available in a nation like India. This will push up labor expenses and negate India’s benefit of having inexpensive labor costs.