Could paying everyone benefits – rich and poor – be the best way to tackle poverty?

Traditional wisdom suggests that if you give a man a fish, he’ll be fed for a day. Teach him to fish, however, and he’ll be able to eat for a lifetime.

But what if we tried giving a man money, so that he can buy what he needs most?

Policymakers are now considering this radical option as a solution to poverty, and as an alternative to the welfare state.


Historically, policymakers have tackled poverty by providing people with specific goods and services, so-called “in-kind” benefits, or through attempts to improve their skills.

For decades, economists have made the case for a third way – giving money to those in need. Such schemes go by different names, but the most well-known might be the “basic income”, which would see governments give a fixed amount of money to every person, regardless of earnings.

The idea is starting to gain traction. In the past year, plans to introduce pilots have gained traction in Germany, Holland, Finland and Canada. A basic income policy has been put forward as a radical answer to streamline the British welfare state.

Now, GiveDirectly, a charity that gives money to people in Kenya and Uganda, is gearing up to launch its own basic income trial. For the first time, the idea of a basic income – which has existed for centuries – will put be put to a rigorous test.

Michael Faye, a GiveDirectly co-founder, says that “there is often an implicit assumption that the poor can’t be trusted to make decisions for themselves”. As a result, governments have relied on large, bureaucratic systems to help those in need.

Perversely, these can create poverty traps, as recipients of aid often face losing access to welfare payments if they get a new job, or increase their earnings. The complexity involved means that many people are often better off working less.