Namibia, Basic Income Grant, BIG, Der Spiegel, Gates Foundation, U.S. Government, foreign aid, World Bank, International Monetary Fund, income security for all, Peaceful Positive Revolution,, Steven Shafarman
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Sunday, October 18th 2009

Ending poverty in Namibia, with income security for all

Ending poverty in Namibia, with income security for all

Namibia, in southwest Africa, is one of the poorest countries in the world, with a high rate of AIDS and many of its 2.1 million people living on less than $1 a day. But it may be leading the world in showing a way to end hunger and poverty.

The German magazine Der Spiegel has an article about the remarkable successes of a Basic Income Grant experiment in the village of Otjivero. I’ve been following the program since shortly after it began in January 2008, and I contributed money to help fund it. It’s scheduled to run through the end of this year, and the organizers hope it will become a model for the nation, the continent, and the world.

As the article describes, moreover, the program is doing much more than ending hunger and poverty. There have been dramatic improvements in health outcomes, school attendance, reduced crime and alcoholism, and a significant increase in entrepreneurial activity and employment.

This is one of the most hopeful and important breakthroughs in the world today, though it has not been reported by any American news outlet (there have been earlier stories in the BBC and Please circulate this news widely.

This is how our government ought to be investing our foreign aid dollars, and what the Gates Foundation, World Bank, International Monetary Fund, and other aid agencies and charities ought to be supporting. They should pay for expanding the Otjivero program to the whole country — and could do so for less money than they are currently spending on piecemeal programs.

The Der Spiegel article is here. (It’s in three parts: Part one is “How a Basic Income Program Saved a Namibian Village. Part two is “A Village of Entrepreneurs.” Part three is “‘I’m Doing Very Well.’”)

The Namibia pilot program was organized by a coalition of church, labor, health, and social justice organizations. The coalition’s web site has a good description of the program and its advantages compared with conventional aid programs reasons, here.

The coalition recently prepared a comprehensive assessment report that includes a  discussion of how it could be implemented nationwide. For your convenience, copied below are the executive summary and concluding remarks. The complete report is a 103 page pdf, here .

Similar ideas can be applied in any country, including the United States. That’s the subject of my blog,, and my book, Peaceful, Positive Revolution: Economic Security for Every American.

Steven Shafarman



In January 2008, the Basic Income Grant (BIG) pilot project
commenced in the Otjivero-Omitara area, about 100 kilometres
east of Windhoek. All residents below the age of 60 years receive
a Basic Income Grant of N$100 per person per month, without
any conditions being attached. The grant is being given to every
person registered as living there in July 2007, whatever their
social and economic status.
This BIG pilot project is designed and implemented by the Namibian
Basic Income Grant Coalition (established in 2004) and is
the first universal cash-transfer pilot project in the world. The
BIG Coalition aims to practically pilot the Namibian Government's
NAMTAX recommendation of a BIG for Namibia. Thus the
BIG Coalition regards this project as the first step towards a BIG
for all. The BIG Coalition consists of four big umbrella bodies in
Namibia, namely, Council of Churches (CCN), the Namibian
Union of Namibian Workers (NUNW), the Namibian NGO Forum
(NANGOF) and the Namibian Network of AIDS Service Organisations
(NANASO). Funds to start the pilot project were raised
through voluntary contributions from supporters of the idea
from all sections of Namibia's society, and by support from
people, churches, organisations and donors in other countries.
The BIG pilot project will run for a period of 24 months up to
December 2009.
The effects of the BIG pilot project are evaluated on an on-going
basis. Four complementary methods were used. First, a baseline
survey was conducted in November 2007. Second, panel surveys
were conducted in July and November 2008. Third, information
was gathered from key informants in the area. Fourth, a series of
detailed case studies of individuals living in Otjivero-Omitara
was carried out.
This report presents the socio-economic results after the implementation
of the BIG for 12 months. The key findings include
the following:
➢ Before the introduction of the BIG, Otjivero-Omitara was
characterised by unemployment, hunger and poverty.
Most residents had settled there because they had
nowhere else to go, their lives were shaped by deprivation
and they had little hope for the future.
➢ The introduction of the BIG ignited hope and the community
responded by establishing its own 18-member
committee to mobilise the community and to advise residents
on how to spend the BIG money wisely. This suggests
that the introduction of a BIG can effectively assist
with community mobilisation and empowerment.
➢ As the BIG was only introduced in one particular location,
there was a significant migration towards Otjivero-
Omitara. Impoverished family members moved into
Otjivero, attracted by the BIG, even if migrants themselves
did not receive the grant. This points to the need
to introduce the BIG as a universal national grant in order
to avoid migration to particular regions, towns or
➢ The migration to Otjivero-Omitara affected the data obtained
for this study. Per capita income from the BIG
dropped from N$ 89 per month in January 2008 to N$ 67
in November 2008. We thus analysed the impact of the
BIG, taking the influence of migration into consideration.
➢ Since the introduction of the BIG, household poverty has
dropped significantly. Using the food poverty line, 76% of
residents fell below this line in November 2007. This was
reduced to 37% within one year of the BIG. Amongst
households that were not affected by in-migration, the
rate dropped to 16%. This shows that a national BIG
would have a dramatic impact on poverty levels in Namibia.
➢ The introduction of the BIG has led to an increase in
economic activity. The rate of those engaged in incomegenerating
activities (above the age of 15) increased from
44% to 55%. Thus the BIG enabled recipients to increase
their work both for pay, profit or family gain as
well as self-employment. The grant enabled recipients to
increase their productive income earned, particularly
through starting their own small business, including
brick-making, baking of bread and dress-making. The
BIG contributed to the creation of a local market by increasing
households' buying power. This finding contradicts
critics' claims that the BIG would lead to laziness
and dependency.
➢ The BIG resulted in a huge reduction of child malnutrition.
Using a WHO measurement technique, the data
shows that children's weight-for-age has improved significantly
in just six months from 42% of underweight
children in November 2007 to 17% in June 2008 and
10% in November 2008.
➢ HIV positive residents' access to ARVs was hampered by
poverty and a lack of transport before the BIG was introduced.
The BIG enabled them to afford nutritious food
and gain access to the medication. This was further enhanced
by government's decision to make ARVs available
in Otjivero, freeing residents from the need to travel to
➢ Before the introduction of the BIG, almost half of the
school-going children did not attend school regularly.
Pass rates stood at about 40% and drop-out rates were
high. Many parents were unable to pay the school fee.
After the introduction of the BIG, more than double the
number of parents paid school fees (90%) and most of
the children now have school uniforms. Non-attendance
due to financial reasons dropped by 42% and this rate
would have been even higher without the effects of migration
towards Otjivero-Omitara. Drop-out rates at the
school fell from almost 40% in November 2007 to 5% in
June 2008 and further to almost 0% in November 2008.
➢ The residents have been using the settlement's health
clinic much more regularly since the introduction of the
BIG. Residents now pay the N$4 payment for each visit
and the income of the clinic has increased fivefold from
N$ 250 per month to about N$ 1,300.
➢ The BIG contributed to the reduction of household debt
with the average debt falling from N$ 1,215 to N$ 772
between November 2007 and November 2008. Savings
increased during that period, which was reflected in the
increasing ownership of large livestock, small livestock
and poultry.
➢ The BIG has contributed to a significant reduction of
crime. Overall crime rates – as reported to the local police
station – fell by 42% while stock theft fell by 43%
and other theft by nearly 20%.
➢ The introduction of the Basic Income Grant has reduced
the dependency of women on men for their survival. The
BIG has given women a measure of control over their
own sexuality, freeing them to some extent from the
pressure to engage in transactional sex.
➢ The criticism that the BIG is leading to increasing alcoholism
is not supported by empirical evidence. The community
committee is trying to curb alcoholism and has
reached an agreement with local shebeen owners not to
sell alcohol on the day of the pay-out of the grants.
➢ The BIG is a form of social protection, which reduces
poverty and supports pro-poor economic growth. As a
national policy it would greatly assist Namibia in achieving
the Millenium Development Goals to which the country
has committed itself.
➢ The costs of a national BIG in Namibia are substantial.
The net costs will be between N$ 1,2 – 1,6 billion per
year, equivalent to 2,2 – 3% of Namibia's GDP. There are
various options to finance such a national grant. A moderate
adjustment of VAT combined with an increase in
income taxes is one option. This would benefit all middle
and lower income households in terms of available incomes.
Other financing options include a re-prioritisation
of the national budget and the introduction of a special
levy on natural resources.
➢ An econometric analysis revealed that Namibia's tax capacity
exceeds 30% of the national income. The current
collection rate is below 25% and thus Namibia's excess
capacity to raise tax revenue significantly exceeds the
net costs of a Basic Income Grant. This makes the BIG
affordable in Namibia.
➢ A national BIG would have several medium to long-term
benefits. Based on the developments in Otjivero-Omitara,
it is safe to argue that the BIG will reduce poverty
and unemployment, increase economic activities and
productivity, improve educational outcomes and the
health status of most Namibians.


The BIG pilot project in Otjivero-Omitara has shown
the wide-ranging benefits of a universal income grant in
addressing poverty. The findings contained in this report
document the social and economic changes that
occurred during the past 12 months – some of them being
nothing less than spectacular.
The Basic Income Grant is more than an income support
programme. It provides security that reinforces human
dignity and empowerment. It has the capacity to
be the most significant poverty-reducing programme in
Namibia, while supporting household development,
economic growth and job creation. A BIG has various
developmental impacts. A grant of N$ 100 per person
per month would generate a net benefit of over N$ 900
million a year reaching the rural communities in Namibia.
It can be argued that this would work as an engine
for local economic development. The poor would have
the ability to spend larger amounts on locally produced
goods and services. This would create more viable and
sustainable opportunities for employment in the rural
areas. Furthermore, if people are constantly confronted
with economic insecurity, they will not be able to engage
in entrepreneurial activities. The BIG would therefore
provide income security, which has the ability to
free resources for entrepreneurial risk taking. A BIG is
not an added burden at a time of economic crisis, but
an appropriate intervention that will stimulate demand
- particularly for basic consumer goods.
The BIG is a form of social protection which reduces extreme
poverty and supports pro-poor economic growth.
As a national policy it would greatly assist Namibia in
achieving the Millenium Development Goals to which
the country has committed itself. These goals include
the eradication of extreme poverty and hunger, the pro-
motion of gender equality, the reduction of child mortality,
combating diseases like HIV/AIDS and malaria,
and ensuring environmental sustainability. The empirical
results in Otjivero-Omitara have shown that a BIG
will have a positive impact in all these areas.
While the BIG alone cannot solve all of Namibia's social
and economic problems, it will certainly make a substantial
contribution. One of our findings in Otjivero-
Omitara was that the grant has reduced the dependency
of young women on men for their survival. The
BIG has given women a measure of control over their
own sexuality, freeing them to some extent from the
pressure to engage in transactional sex.
There is no doubt that the cost of a BIG is substantial -
ranging from 2.2% to 3.0% of national income. As
shown by the calculations in this report, Namibia has
the capacity to mobilise the necessary resources
without undermining financial stability. On the contrary,
over time, as Namibia benefits from the long term
growth impact, the Basic Income Grant will become increasingly
more affordable. Moderate adjustments to
VAT and income tax, alternatively royalties levied on
natural resources, or a shift in budget priorities or a
combination of these interventions, will make a national
BIG an immediate option for Namibia. Its implementation
is thus merely a question of political will.
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    5 Responses to “Ending poverty in Namibia, with income security for all”

    1. Floost Says:

      In truth, immediately i didn’t understand the essence. But after re-reading all at once became clear.

    2. Alanna Hartzok Says:

      This is good news about the BIG and this Namibian village! Combining the BIG with ecovillage model and, eventually, land value capture for public finance of infrastructure and the BIG gives an integrated, holistic, and very positive development approach. Note there is an ecovillage training institute for Africa in Dakar, Senegal. Suggesting that two people from this village in Namibia be funded to go through the ecovillage training program.

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    4. Ending poverty in Namibia, with income security for all | Says:

      [...] The German magazine Der Spiegel has an article about the remarkable successes of a Basic Income Grant experiment in the village of Otjivero. I’ve been following the program since shortly after it began in January 2008, and I contributed money to help fund it. It’s scheduled to run through the end of this year, and the organizers hope it will become a model for the nation, the continent, and the world. Read more… [...]

    5. Ending poverty in Namibia, with income security for all | Income … | namibia today Says:

      [...] claims that the BIG would lead to laziness and dependency. … View original here: Ending poverty in Namibia, with income security for all | Income … Share and [...]