Book review scheduled to appear in Canadian Journal of Development Studies

Making the difference! The BIG in Namibia: Basic Income Grant Pilot Project Assessment Report, April 2009
Namibia NGO Forum, Basic Income Grant Coalition, 2009. 103 pages.

URL:  www.bignam.org/Publications/BIG_Assessment_report_08b.pdf
ISBN: 978-99916-842-4-6


My unequivocal recommendation: download this study, read it and assign it to your students.  If like the rest of us, you are forever negotiating multiple deadlines, then at least read the Executive Summary (pp. 13-17). If your curiosity is piqued, but time is still of the essence, there are one sentence long excerpts in boxes in the margin of most of the pages (pp. 18-97) that summarize the report in greater detail.  This report of the first year’s results of a Basic Income Grant (BIG) pilot project in a Namibian village emphatically reflects the values that are embodied in much of today’s development curriculum: agency, community, engagement, empowerment, equity, inclusion, respect. If you want a real life example of US President Obama’s mottos (“Hope” and “Yes we can”) in action, look to Namibia and not to Washington. Namibia has seized the day.

In 2002, I heard a report from Guy Standing, then at the ILO, on Namibia’s universal pension plan for all citizens 60 and over.  Having long been a supporter of a universal Basic Income Grant (BIG) and a critic of the unethical refusal of the world’s ‘haves’ to even discuss serious efforts to deal with the profound inequality of income at all levels: global, national and local, I was inspired to propose a ‘pie-in-the sky’ five year national pilot project to be funded by global financial transfers.  I suggested a basic income grant of one US dollar per day to be paid to all residents of Mali [“A Planet-Wide Citizen’s Income: An Espousal” (2005) http://mfrankman.googlepages.com/BI_LCS.htm].  I likened this to a clinical trial in which Millennium Development Goals (MDGs) efforts elsewhere in Sub-Saharan Africa could be regarded as the control or placebo.

At the same time, unknown to me, efforts spearheaded by a broad-based civil society coalition (http://bignam.org) were going on in Namibia to introduce a village-level 2-year pilot project which would be monitored by a research team of well-known South African social scientists. The principal funding for this endeavor is from the Namibian government, hence not only don’t the grant recipients have to meet conditions (other than having been residents of the village 6 months prior to the start of the pilot), but, perhaps more significantly, the government doesn’t have to satisfy preconditions dictated by the changing whims of providers of external funding.

Commencing in January 2008, an unconditional grant of N$100/month (US$13/month) was given to all residents of Otjivero-Omitara under the age of 60 [those 60 and above already were receiving a monthly old age pension of N$370].  In all, there were 930 recipients of grants, with the grants for children being paid to their caregiver. The transformational effects of the basic income appear to have surpassed all expectations.  The school fees (N$50 per year) are still in place, but enrolment has increased markedly. Clinic fees (N$4 per visit) continue to be charged and people are turning up and proudly paying them. The town’s clinic recorded a five-fold increase in its monthly revenues.  The universal BIG simultaneously brought benefits both to the sick, many of whom previously had no choice but to let ailments go untended, and to the clinic.  The situation of HIV-positive residents improved in two ways:  through a greatly improved diet and through a monthly visit of a doctor who previously only provided antiretrovirals (ARVs) at a 100km distant clinic which could we reached only at great cost. As more individuals were able to afford to visit the local clinic, the number of people receiving ARVs rose from 3 to 36 in a 9 month period.

The report includes numerous comments from people and officials in the town.  One teacher remarked that the children now come to school well-fed (and hence alert), washed and wearing school uniforms, whereas previously they had no money for soap, for uniforms and for school fees.

The startling progress made in Namibia in one year strongly suggests that the ‘clinical trial’ is successful and that Namibia itself and the rest of Africa should follow suit.  To illustrate: using the WHO standard, 42% of the children of Otjivero-Omitara measured prior to the start of the study were malnourished. Six months after the start of the pilot project, the malnourished in the same age cohort had dropped to 17% and at the one year mark none of those present at all 3 stages of the study were malnourished.  The report notes that the pervasive begging for food prior to the start of the trial had disappeared after the first year of the monthly provision of the BIG. Even reported crime diminished.  As people were able to pay for food, cases of stock theft and ‘illegal hunting and trespassing’ fell, the latter from 20 incidents to 1.

The record of improvement is considerable despite 11% net immigration to the town after the eligibility of residents was established.  In-migrants received no BIG, but were able to share BIG proceeds received by various households, in the same manner as nationwide senior pensions have long been shared.

With the World Bank continuing to insist on elaborate administrative-intensive targeting for its pet conditional cash transfers (CCTs), the contrast with the Namibian BIG pilot is particularly significant.  Parents and children do not have to be convinced that schooling is important, but they need to have the discretionary income be able to make the required payments.  The primary school principal in Otjivero-Omitara reported that drop-out rates fell from 30-40 percent before the introduction of the BIG to zero one year later. Moreover, at the beginning of 2009 for the first time a group of 9 students were able to leave Otjivero-Omitara to attend a secondary school.  Associated with the BIG was an increase in the number of children in the crèche from 13 to 52.
 
Microcredit is conspicuous by its near total absence.  Discretionary income provided by the modest monthly BIG was quite sufficient to allow the creation of numerous businesses. Rather than sanctifying ‘free markets’ and ‘free trade’ based on one comment by Adam Smith about the invisible hand, we would do well to remember that he also said the division of labor must always be limited by the extent of the market. The BIG Pilot Project especially extended the local market: while mean household wage income increased by 19% in one year, mean income from self-employment expanded 4-fold to almost equal wage income. For the community as a whole average mean income, excluding the BIG, increased by 29% in one year. After the introduction of the BIG one young woman began baking 100 rolls per day. She reported a monthly profit of N$400, four times the value of the BIG.  As the study notes, rather than becoming dependent on the BIG, many poor people chose to diversify their incomes.
The moral of the Otjivero-Omitara BIG pilot project clearly seems to be that putting money in the hands of the poor is likely to give rise to effects that cumulatively ramify throughout the lives of households, the community and the nation. The people of Otjivero-Omitara did not have to take a 16 point Grameen Bank type pledge including “We shall not live in dilapidated houses.” People knew what needed attention once income came their way: the average number of rooms in households increased from 2.6 to 3.2 in six months and one-fifth of the home roofs were improved.

The good news for Namibia, given the fickle and often recalcitrant nature of national and international aid providers, is that estimates in the report suggest that a 2-4% increase in tax burden relative to Namibian GDP is judged to be sufficient to extend the pilot BIG to the national level, which the authors of the study recommend. Given that much of Sub-Saharan Africa has been lagging behind in the achievement of many of the MDGs, the early successes in Otjivero-Omitara merit replication elsewhere and might well convince donor countries to loosen both their purse strings and their conditionalities.


Myron J. Frankman, McGill University, July 4, 2009
myron.frankman@mcgill.ca