From cash transfers to farmers as applied in several states and now copied by the Narendra Modi government, to the proposed ‘Nyuntam May Yojana’ (NYAY) scheme just announced by the Congress party for the bottom 20% of the population, the idea seems to be that governments can improve conditions of life and work for their citizens not by providing public services, but simply by distributing cash.
Congress’s scheme is laudable in shifting public attention back to the urgency of policies to deal with those in extreme poverty. The basic principle of the government’s responsibility to guarantee all citizens a minimum income or standard of living is also one that definitely should be supported. But how best can such a goal be achieved?
The difficulties of a scheme like NYAY are obvious. Indeed, some have already been highlighted by the ruling government, which has done nothing for people experiencing poverty in the past five years and has reneged on most, if not all, of its promises to the people. The most important issues relate not to the overall costs but to the problems of targeting and identifying beneficiaries and the concern that this may lead to the reduction of other very important social spending.
But suppose we take up the spirit of the scheme, which is worth doing and considered a workable alternative to the current proposal. This combines major policy moves in three areas to provide universal basic services, universal employment guarantees, and universal pensions. Together, these have the advantage of avoiding all the concerns with targeting, creating more employment of all sorts, and providing life with dignity for all citizens rather than a designated group.
