Sign In
Learn bits
Health & Medicine
Mahesh

25/08/22 10:30 AM IST

UNIVERSAL BASIC ‘INSURANCE’

In News 
  • As the importance of social security came into focus after the major waves of the COVID-19 pandemic, the debate on universal basic income (UBI) began to resurface in policy circles across the globe.
Why UBI? 
  • The insurance penetration (premium as a percentage of GDP) in India has been hovering around 4% for many years compared to 17%, 9% and 6% in Taiwan, Japan and China, respectively.
  • Thus insurance can become a need-based safety net for the poor.
  • The economy largely remains informal, data of that informal sector are now available both for businesses (through GSTIN, or Goods and Services Tax Identification Number) and for unorganised workers (through e-Shram, which is the centralised database of all unorganised workers).
  • The social registry portal, ‘Kutumba’, developed by Karnataka is a good example of social security data.
Types of Security Nets 
  • The first type of safety net is basically a social assistance programme meant for the most income-deprived sections of society.
  • The second is an active safety net which works like a trampoline so that those who fall on it are able to bounce back to ‘Basic Living Wages’. The second type of safety net is a scheme with a higher outlay.
  • The third is a proactive safety net which acts like a launchpad so that those who fall on it will not only bounce back but will also move up beyond ‘Basic Living Wages’.
  • The third type of social security net is the most desirable option but requires immense resources and institutional capacity.
Concerns 
  • Lack of political will
  • Huge fiscal pressure
  • Free cash to people may increase the inflation rate
  • Difficulty in reducing subsidies on exiting schemes
  • No guarantee that cash will be spent on productive assets.
Source- The Hindu 

More Related Current Affairs View All

05 May

Key objectives of caste count

'The Union Cabinet has decided that the next Census will include questions on caste to its enumeration of India’s population, for the first time in almost a century. ' T

Read More

05 May

2 new genome-edited rice varieties

'Agriculture Minister Shivraj Singh Chouhan recently released two genome-edited varieties of rice, the first achievement of its kind in the country.' These two varieties, which

Read More

05 Mar

First-ever comprehensive survey of India’s river dolphins

'Prime Minister Narendra Modi released the results of the first-ever comprehensive population estimation of riverine dolphins – Gangetic and Indus dolphins – done in In

Read More

India’s First Ai-Driven Magazine Generator

Generate Your Custom Current Affairs Magazine using our AI in just 3 steps