A recent report by the United Nations Development Programme (UNDP) has pointed to the need for an immediate introduction of a Temporary Basic Income for the world’s poorest people, which it says could contribute to slowing the current surge in COVID-19 cases by enabling nearly three billion people to stay at home.
The report, Temporary Basic Income: Protecting Poor and Vulnerable People in Developing Countries, estimates that it would cost from US$199 billion per month to provide a time-bound, guaranteed basic income to the 2.7 billion people living below or just above the poverty line in 132 developing countries.
The report concludes that “the measure is feasible and urgently needed, with the pandemic now spreading at a rate of more than 1.5 million new cases per week, particularly in developing countries, where seven out of ten workers make a living through informal markets, and cannot earn money if they are at home”.
According to the report, many of the huge numbers of people not covered by social insurance programmes are informal workers, low-waged, women and young people, refugees and migrants, and people with disabilities; and they are the ones hardest hit by this crisis.
UNDP reports that it has carried out assessments on the socio-economic effects of COVID-19 in more than 60 countries in the past few months, and the evidence shows that workers who are not covered by social protection cannot stay at home without an income.
According to the report, a Temporary Basic Income would give such persons the means to buy food and pay for health and education expenses. It is also financially within reach: a six-month Temporary Basic Income, for example, would require just 12 percent of the total financial response to COVID-19 expected in 2020, or the equivalent of one-third of what developing countries owe in external debt payments in 2020.
The report suggests that one way for countries to pay for a Temporary Basic Income would be to repurpose the funds they would use this year to service their debt. Developing and emerging economies would spend $3.1 trillion in debt repayment this year, according to official data.
According to the UN, COVID-19 has exacerbated existing global and national inequalities, and has created new disparities that are hitting the most vulnerable people the hardest. With up to 100 million more people being pushed into extreme poverty in 2020; 1.4 billion children affected by school closures, and record-level unemployment and loss of livelihoods, UNDP predicts that global human development is on course to decline this year for the first time since the concept was introduced.
In Guyana’s case, mere days after the new Government took office, it announced a $4.5B relief package for households. Just recently, Vice President Bharrat Jagdeo told the media that all steps are being taken to ensure the funds are disbursed in a “transparent and rapid manner.”
He had noted that there are large numbers of people out there who need assistance from the Government, through either help for food to feed their families or some cash assistance. He had explained that the issue before Government now is whether it could use money from the treasury, or it would have to raise the sum in the interim before there is a budget through borrowing, and once the budget is passed, repay that loan.
The Government must be commended for taking this initiative, which we are certain would go a far way in providing a great relief to families; as, for many months now, citizens are feeling the squeeze. Even with the COVID-19 cases skyrocketing over the past few days, persons are being forced to risk their lives, as they have to venture out to work in order to support their families.
Once the disbursements are made, the Government would need to take certain measures to enforce curfews in regions that are experiencing a sharp rise in COVID-19 cases.
As stated by UNDP Administrator Achim Steiner, bailouts and recovery plans cannot only focus on big markets and big business. A temporary financial assistance might enable governments to give people in lockdown a financial lifeline, inject cash back into local economies to help keep small businesses afloat, and slow the devastating spread of COVID-19.
