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CYPRUS: Significant step toward a Basic Income Guarantee

The national parliament of Cyprus has introduced a policy with a name that translates as “guaranteed minimum income” or “minimum guaranteed income.” The name sounds like a Basic Income Guarantee (BIG). It is not, but it appears to be a significant step in that direction. The law was enacted 10 July 2014, and the first recipients started signing up on 14 July 2014. According to the Cyprus Daily, the law provides a minimum income of 480 Euros for Cypriot citizen, “irrespective of whether they are unemployed, pensioners or self-employed. … For every additional family member over 14, including the wife or husband, 50% of the initial amount of €480 (240) will be added to the benefit. For members under 14, an additional 30% (€144) will be added.” According to Cyprus Mail, the government arrived at those amounts using figures including the average cost of rent in Cyprus, cost of living and entertainment and others.

The guarantee is means tested—making it closer to the Negative Income Tax than to the Basic Income form of BIG. Income must be “less than the real needs of the household,” and wealth must be less than $100,000 Euros for each member of the household. The new guaranteed minimum replace most existence state benefits in Cyprus. When the government proposed the idea of a “guaranteed minimum income” last year, the prime minister said it would come with a work expectation. Available reports so far make no mention of whether the final version included work requirements or how strict they are. However, the combination of benefits, the effort to meet basic needs through cash benefits, and the ability to keep them whether employed or not is a significant step in the direction of a true basic income guarantee, a step that few if any Western industrialized nations have yet taken.

For more information on the new law see:
InCyprus, “Guaranteed minimum income approved.” The Cypress Daily: InCyprus.com, 11 July 2014

Cyprus Mail, “Large family benefits not to be impacted by GMI.” Cyprus Mail, July 22, 2014

Cyprus Mail, “Our View: Public sector cuts could finance better welfare system.” Cyprus Mail, July 22, 2014

Applicants sign up for Guarantteed Minimum Income -Cyprus Mail

Applicants sign up for Guarantteed Minimum Income -Cyprus Mail

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