Finland's universal basic income test yields mental health benefits

The country's cash drop is a bold social experiment...

Finland has embarked on a social experiment, handing out a guaranteed €560 per month tax-free for two years to 2,000 random unemployed citizens - without factoring in their savings, access to funds, or any other data.

These individuals will be given these tax-free payments for 24 months regardless of their employment status and they are not required to report how they spend the money.

The country is testing "universal basic income" - it allows people who are not working to engage in casual, part-time, or freelance work without losing social welfare payments.

Marjukka Turunen, the head of legal department of Finland's social insurance agency, has said that in its early stages the programme is having a positive impact. Speaking to Kera News in the US, she said that one of the offshoots of the scheme has been mental health benefits, including reduced stress levels.

"The idea here is to give these people this financial security so that they can free their minds and not worry all the time about the money, the basic needs. They can now fulfil them with this basic income, because [of] the problem in our unemployment benefit system.

"It’s not worthwhile for you to take on, for example, a part-time job because we have incentives, traps in our social security system that sometimes, when you take on a part-time job, you get less money into your hand than you would if you [get] full unemployment benefits," she commented.

“If [we] were to give people $1,500, there would be no incentive at all to go and seek out jobs for many people because you can easily survive with that here in Finland ... We tried to figure out the amount that would be accurate and enough for these people to seek out jobs but not passivate themselves for staying at home and just not doing anything," Ms Turunen added.

One of the advantages of the programme is that the single pay-out model reduces bureaucracy and streamlines the payment process by replacing a series of individual social welfare payments.

"There was this one woman who said, ‘I was afraid every time the phone would ring, that unemployment services are calling to offer me a job'...

"She said that she cannot take on a job because she’s taking care of her elderly parents at home. This experiment really has an indirect impact, also, on the stress levels and the mental health and so on," the Finnish official told the Texas outlet.

Unemployment in Finland has hovered just above 8% for the past year.

Canada, Iceland, and The Netherlands have considered similar programmes.