Debates and discussions are on in Switzerland about giving its people $2,500 a month for doing nothing.

A vote that would decide whether the government should replace the various welfare benefits with the introduction of an unconditional basic income is slated to be held in the country on June 5.

The initiators of the plan have suggested the sum of 2,500 francs ($2,500) for an adult and a quarter of that for a child even though they haven’t stipulated how large the payout should be.

Barring two things, the plan sounds good. Switzerland is identified as one of the world’s most expensive countries and the amount that is being planned to be given out as a grant would barely be able to get a recipient over the poverty line in the country where the poverty line is typically defined as 60 percent of the national median disposable income. But more importantly there is enough opposition ot the plans and hence probably would never happen.

With multiple votes every year on various subjects, plebiscites are a common part of Switzerland’s direct democracy. Though current polls suggest that the basic income initiative won’t get any further, it is taking place after the proposal gathered the required 100,000 signatures. While countries like Canada, the Netherlands and Finland have started initial studies about basic income grants last year and the idea of paying everyone a stipend has piqued interest in some other countries  as well.

The amount that has been mentioned would allow for a “decent existence” for the receivers of it, say the initiators. Despite this assurance calculations are that the sum would provide only 30,000 francs — just above the 2014 poverty line of 29,501 francs, on an annual basis.

According to the statistics office of the country, nearly one in eight people in Switzerland were below the level in that year. That figure is more than in France, Denmark and Norway. One in five of those over 65 in Switzerland were at risk of being poor.

“It’s not like you see abject poverty in Switzerland. But there are a few people who don’t have enough money, and there are some people who work and don’t earn enough,” said Andreas Ladner, professor of political science at the University of Lausanne.

Basic income is necessary as automation and robots increasingly eliminate jobs, believes former Greek Finance Minister Yanis Varoufakis who is among the proponents of basic income.

“A rich country like Switzerland has the great opportunity to try out this great experiment,” he said.

The conditions under which non-citizens would qualify is not laid out by the initiative.

The stipend would mean higher taxes, create disincentives to work and cause a skills shortage, says the government which opposes the proposal. With businesses warning they’ll move production to less pricey locations to reduce costs, the economy is already hamstrung by the franc’s strength.

“We’ve come to the conclusion that such an initiative could weaken our economy,” said Interior Minister Alain Berset.

With polls showing some 60 percent also opposing it, the view has struck a chord with the electorate.

(Adapted from Bloomberg)

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