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The experience of cash transfer programmes and basic income pilots is that, for the most part, the money is spent on ‘private goods’, such as food for children, healthcare and schooling. What is more, studies have shown that, contrary to popular prejudice, receipt of a basic income or cash transfer leads to reduced spending on drugs, alcohol and tobacco, which can be seen as ‘therapy bads’ (or ‘compensatory bads’) for alleviating a difficult and hopeless situation. Four examples are worth reflection. In Liberia, a group of alcoholics, addicts and petty criminals were recruited from the slums, and each given the equivalent of US$200, with no conditions attached. Three years later, they were interviewed to find out what they had used the money for. The answer was mainly for food, clothing and medicine. As one of the researchers wondered, if such people did not squander a basic income grant, who would?8 Another study, reported by The Economist, took place in the City of London, known as the Square Mile, where a ‘hidden legion of homeless people’ emerges in the evening.9 Broadway, a charity, identified 338 of them, most of whom had spent over a year living on the streets. It singled out the longest-term rough sleepers, those who had been on the streets for over four years, asked what they needed to change their lives and gave it to them. The average outlay was £794. Of the thirteen who engaged, eleven had moved off the streets within a year. None said they wanted the money for drink, drugs or gambling. Several told researchers that they cooperated because they were offered control over their lives, rather than, in their eyes, being bullied into hostels. And the cost was a fraction of the £26,000 estimated to be spent annually on each homeless person, in health, police and prison bills.
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