A Universal Benefit Regime

Context: To minimize the pandemic induced economic impact on the most vulnerable population, it is imperative to create a scheme, with a sunset clause, of universal benefits.

Governments Digitised Relief Measures

• Cash transfer/PDS: 9 million households could have both run out of savings and not received any cash transfer from the government.

• 94% of eligible families had received extra PDS rations.
• JAM trinity: has helped lower transaction costs, reduce leakages, and reach beneficiaries quickly. 
• Aadhaar: prevented identity frauds. 
• Payments infrastructure enables DBT. 
• MGNREGA payments: improved more than threefold since 2015.
• Pilots for the One Nation-One Ration Card: have shown the possibility of inter-state portability.

Need for Universal Benefits Approach: The current pandemic has deteriorated the condition of vulnerable sections.

• Loss of pre-crisis income/jobs: Primary income earners in two-thirds of the households have lost their jobs or wages. 
• The average family has lost more than 60% of its pre-crisis income. 
• One in five primary income earners does not expect to find work in the near future.
• Rising debt: 40% of families are in debt and 24% of low-income households have run out of money and supplies.
• Loss of BPL status: above poverty line workers would not be able to avail of the benefits of BPL status.
• To enable accessibility: to cash relief transfer /free or subsidized rations with minimal paperwork. 

Way Forward

• Universalised PDS system : like Tamil Nadu and Chhattisgarh’s universalised PDS that provided strong coverage and equitable pricing.
• Voluntary opt-outs : by highlighting the real intended targets of the relief effort and the adverse impact on millions of people. 

• • • Like “Give up LPG Subsidy” campaign 
    • This could reduce the burden on the exchequer.

• Emphasis needs to be on including those who deserve : rather than making sure the wrong people are kept out. 

• Universal benefits with sunset clause: i.e discontinue relief once the pandemic ends and the economic shocks discontinue.