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Finland becomes first country to pay the unemployed a fixed income

Finland will now pay its unemployed a fixed income Credit: AP

Finland has become the first country to start paying its unemployed a fixed monthly income.

Citizens without work in the Scandinavian country will now be entitled to £478 a month from the Finnish government agency KELA.

The move is part of a social experiment to try to reduce poverty, boost employment and cut government red-tape.

Those chosen to participate will receive the fixed income monthly, with no obligation to report how they spend the money.

KELA spokesman Olli Kangas said the scheme's idea was to abolish the "disincentive problem" among the unemployed.

Finland's current unemployment stands at 8.1% Credit: PA

The new trial also aims to discourage people's fears "of losing out something."

In Finland, a jobless person may refuse a low-income or short-term job out of fear of having financial benefits reduced drastically under the country's generous but complex social security system.

"It's highly interesting to see how it makes people behave," Kangas said.

"Will this lead them to boldly experiment with different kinds of jobs? Or, as some critics claim, make them lazier with the knowledge of getting a basic income without doing anything?"

Rates of unemployment in Finland, a nation of 5.5 million, stands at 8.1% with some 213,000 people without a job.