Should a Universal Basic Income be granted to all migrant workers in this lockdown?
Tejas Sateesha Hinder
Issue 2 | June 27, 2020
The issue of migrant workers has plagued the world, and largely the South Asian Region, in lieu of the lockdowns issued, owing to the outbreak of the COVID-19 pandemic, which has resulted in suspension or closures of multiple institutions and businesses and rendered many migrant workers unemployed, without a regular income. This has had a backlash on migrant workers belonging to the lower middle class and the lower class, as it has led to significant liquidity crunches and financial issues. The problems stand to be the poor accommodation and sanitation facilities that are being given to these workers by State Governments and the Central Government in the absence of their regular income and their inability to go home in the absence of travel facilities.
This brings us to a very important question, which is, irrespective of the nature of occupation of these migrant workers, should a universal base income be granted to these workers? The answer to this question can always be in the form of opposing views, which is what is aimed to be outlined in this article.
Looking into why it becomes necessary at this moment, and how the same can be done, it is imperative to understand that this uniform income, which should be made non-taxable, should come in addition to the accommodation facilities that the government is granting to the individuals. The income when granted should however mitigate the sanitation facilities that the government is currently granting. This income should become the means to attain this form of sanitation, and at the same time should be sufficient enough to make savings, and send back the same home, as many of these workers are the sole breadwinners of the family. The calculation of this income however shouldn’t be so skewed and slimy, so as to ensure that it is only enough for the worker to meet his basic personal ends and expenses. In addition to this, it is important to understand that this income may act as a stepping stone towards attaining better accommodation facilities, which may be outside the purview of what is being granted by the government. What is being implied here is that it should not be a bare minimum wage to just support the living of the worker, as that does not make better the status quo in any manner. The governments should clearly demarcate between the classes of migrant workers while granting this income, so as to reach out to the really needy ones at this juncture. A significant backlash to this could be that the grant of this income would disincentivize a search for employment by these workers, and that native workers have also been laid out due to temporary slumps in businesses. A counter to this could be the nature and purpose of the basic income being granted to these migrant workers, for their basic sustenance, accommodation and quality of life, due to them being outside home, which is not the case with native workers. Generation of employment, temporary provision of facilities, or a temporary grant of an amount for the ones rendered unemployed can be a possible solution for native workers, but due to the aforesaid reasons, they do not deserve the same income as that of the migrant workers.
After ascertaining a liquidated amount to support these migrant workers, it becomes imperative to look into the manner in which the same can be granted. This amount should be given by the respective State Governments by diverting funds from the State Disaster Response Funds (SDRF). In States where insufficiency is created at some stage, funds need to be respectively diverted from the National Disaster Response Fund (NDRF), as the State contingency fund ought to be reserved for investing to fight this pandemic.
Let us now examine the criticisms to this model. This model imposes a burden on the tax payer who may, at this time be working with a lower wage, or be at the risk of being laid off two, due to which this taxes may seem unjustified on them, when they realize that a portion of it is going to individuals not involved in substantial employment. This incentive also portrays these migrant workers as burdens on the State and its economy, as they, at one end are not contributing as human resources and human capital, but at the same time are consuming resources of the state. This can considerably adversely impact the State and the middle class; the Statebecause of the increasing burden on resources without significant contribution, and the middle class and even upper classes because of the increased competition for resources with decreased supply coupled with lower contribution in the producing and processing sectors, owing to the lockdown. Due to significant decline in contribution of workers coupled with the lockdown impacting production and increased demand, there may even arise inflation in the market. Further, diverting funds from the SDRF and NDRF may put States in a disadvantageous situation in cases of natural calamities, such as the recent Cyclone Amphan, which may leave States devastated. In addition to this, diverting funds from the NDRF may add fuel to the fire.
On a concluding note, let us try and look at the way forward. At one end, we may have the permission to withdraw advanced EMF Money in advance in cases of temporary suspension of working institutions of migrant workers, granted. In addition to that, the Governments have to selectively categorize the individuals among these migrant workers on the basis of temporary loss or permanent loss of employment, and then on the basis of these two classes, differentiate the UBI, but keep it uniform across each class so created in the manner discussed previously, but at the same time ensure that the SDRF does not drop beyond a certain amount, which would be the amount required to tackle natural calamities to a certain extent. It doesn’t become an issue here because the State contingency funds are always in place for this purpose. When it comes to burden on the tax payer, the government should make clear its objective of supporting these workers through the tax, not charge an additional tax for this purpose, and try cutting down on expenditures not in need of immediate redressal. If required, governments may even attempt to borrow funds from well off NGOs through consent, which may aim to resolve problems that are not in need of immediate redressal as much as this pandemic is. Non-embezzlement should be ensured at the same time, and transparency with regard to the allocation of these funds should be maintained through mechanisms like the RTI at all times. In order to prevent possibilities of inflation, the government should aim to employ workers as much as it can in the production and distribution sectors, and make it mandatory for workers to do the same. This would also lessen the burden on the State, as it would not only cause a reduction in the UBI being paid, but also due to the increase in human resource and human capital.