Finland starts paying 2,000 unemployed people a basic income
Finland has become the first European country to pay its unemployed citizens a basic income as part of a two-year trial that leaders hope will improve quality of life.
As of this month, 2,000 randomly picked citizens receiving unemployment benefits will be given £480 every month until December 2018, without any restrictions or conditions attached.
They will not have to show they are looking for work and will receive the money regardless of any other income they earn.
According to official data, the average private sector income in Finland is 3,500 euros per month
The country’s Ministry of Social Affairs and Health said the experiment “aims to find out whether basic income promotes employment”.
Under Finland’s generous and complex social security system, a unemployed person might turn down a low-income or short-term job in the fear of having their financial benefits drastically reduced.
The scheme’s idea is to abolish the “disincentive problem” among the unemployed by discouraging fears “of losing out something” said Olli Kangas from the Finnish government agency KELA, which is responsible for the country’s social benefits.
“It’s highly interesting to see how it makes people behave,” he added.
“Will this lead them to boldly experiment with different kinds of jobs? Or, as some critics claim, make them lazier with the knowledge of getting a basic income without doing anything?”
The basic income experiment is one of the measures by Prime Minister Juha Sipilä’s centre-right government to tackle Finland’s employment problem.
The country’s unemployment rate was 8.1 percent in November, with some 213,000 people without a job – a figure unchanged from the previous year.
The scheme may later be expanded to other low-income groups such as freelancers, small-scale entrepreneurs and part-time workers.