Could a £2-a-day basic income be the key to protecting rainforests?

“At the beginning, there was a lot of fear and disbelief,” said Ketty Marcelo. “There was a perception from the communities that this was another scam, that it was only looking to steal information or our integrity.”

Indigenous communities in the Amazon have grown weary of people coming in from outside with plans that could mean them losing their land or way of life. When a team from Cool Earth , a climate action NGO, came to the Amazon communities of central Peru in October 2022, local people were hesitant. “These fears caused some families not to participate,” Marcelo said. “And we, as an organisation, were afraid this would be another project that would seek to impose activities without respecting the autonomy of the communities.”

But what developed instead was a collaboration between Cool Earth and two all-female Indigenous-led organisations – the National Organisation of Andean and Amazonian Indigenous Women of Peru ( Onamiap ), of which Marcelo is president, and the Organisation for Indigenous Women of the Central Selva of Peru (Omiaasec).

Together, they created a groundbreaking basic income pilot project to give £2 a day – with no strings attached – to 188 people across three Asháninka and Yánesha communities in the Avireri-Vraem reserve.

“It’s the world’s first basic income pilot for Indigenous peoples who live in rainforests with a link to protect the forest and fight the climate crisis,” said Isabel Felandro, the global head of programmes for Cool Earth, who leads the organisation’s work in Peru. “There are other basic income initiatives around the world but most are focused on humanitarian or social issues. In the communities we work with, their activities are very linked to the protection of the forest.”

She continued: “Poverty is the biggest driver of deforestation in these areas. These communities in very remote areas not only face a lack of access to basic needs – healthcare, food, education – but on top of that they face the climate crisis. There are more fires in the forest and more droughts. There are also a lot of illegal economies going into these places: illegal logging, illegal mining and drug cartels. Growing drugs is one of the main drivers of deforestation in the areas of the Amazon where we work.

“When people are in urgent need and want to take their children for medical care or to school, sometimes these cycles of poverty lead them to take on roles in those illegal activities, or to sell their land or allow their trees to be cut down. Giving them financial support gives them a choice to have a more sustainable way of living.”

The first cash transfer was made in November 2023. A total of 188 people each receive the equivalent of about £2 a day, or about £55 a month. Cool Earth worked with a tech company, AidKit, to facilitate the process, and the pilot will last for two years, with an equivalent of about £245,000 given in total, though the organisation plans to continue the support on an ongoing basis.

Marcelo said: “Our organisation has always been critical of how climate funds are allocated. Often the money gets stuck in bureaucratic processes and ends up in the hands of large consulting firms rather than reaching the communities most affected by climate change. But we’re now seeing a positive shift. Funds are being distributed directly to communities, enabling families to rebuild their livelihoods and protect their land.”

Three communities were selected because they were known to have an interest in conservation and reforestation. But each individual who receives the money is free to spend it however they choose. Giving money direct to individuals is seen as faster and more cost-effective than setting up long-term community projects, such as in agriculture.

Felandro said: “Cacao or coffee projects create a lot of work and bureaucracy for us. You can skip all [the complication of an agriculture project], give people the income and trust them to make choices to support themselves and their territories. We don’t want to create intermediaries or mass bureaucracy. We really give autonomy to people to spend the money how they want. There are no strings attached at all.”

Prior to the pilot, nine out of 10 people in the communities reported struggling with a lack of food, and early monitoring shows that has improved. Families have also been able to invest money and dedicate more time to growing crops (cacao, cassava, coffee) for food or to sell.

“We’re seeing very positive spending,” Felandro said. “It’s mostly to cover basic needs like food, healthcare or sending their kids to school. Some people are already buying seeds and investing in reforestation – they worry about droughts, so they’re reforesting around the spring to maintain their water supply – a communal activity. Fewer families are facing financial stress. With poverty, they had to prioritise other things. But now they can do more conservation activities and rainforest restoration.”

Marcelo said: “We’ve noticed positive changes. Before the pilot, sometimes you’re worried about how you’ll survive tomorrow, what you’ll eat, or if there’s no work. People no longer have to go to work for others, as day labourers, as often. They can devote more time to working on their own plots and spend more time at home with their children. Both the father and mother receive the transfers, allowing them to create small savings, which gives a greater sense of stability and wellbeing.”

Anahis, a 20-year-old Asháninka woman, is using her basic income funds to complete her computer science studies while also cultivating coffee on a small plot. “I used the first transfer to help my mum to make some purchases: mattresses, utensils, gas,” she said. “I also pay my monthly tuition fees. The pilot’s been very good. Trees are no longer being cut down, people are preserving the trees.”

The combined territory of the three communities spans 738 hectares (1,823 acres). Of that, 513 hectares are covered by forest. Tree numbers and deforestation levels will be evaluated at the pilot’s one-year and two-year points.

Dr Johan Oldekop, a reader in environment and development at Manchester University, who is not involved with the NGO or the pilot, said: “Cool Earth are right to focus on supporting Indigenous communities who are at the forefront of forest conservation and some of the most disadvantaged groups of people in the world. However, we have little and mixed evidence on the environmental effects of cash transfers around the world, with some data showing that it can lead to deforestation, as rural families invest cash transfers to expand agricultural production.

“Cool Earth’s pilot is potentially promising but it needs to be carefully evaluated to determine exactly if and how cash transfers can best help both rural communities and the environment in Peru.”

Cool Earth hopes the pilot will inspire others to replicate the model and establish basic income programmes for rainforest communities around the world. It is exploring potential collaborations in Papua New Guinea and in the Congo basin in Africa.

“We’re very confident direct cash projects are the way to go,” Felandro said. “This idea could apply to Indigenous communities in the whole Amazon and to rainforest communities in other regions of the world.”

Scaling up would require significantly more money. “We’d love to see a global fund for basic income,” Felandro said. “We call Indigenous communities the guardians of the rainforest. But they’re often not provided the agency to support the forest. This basic income pilot is about giving them that. The ideal goal is for governments to get involved. We have the Green Climate Fund , with governments and big companies putting money in, but only 0.01% of the money is really reaching Indigenous communities. With a basic income cash transfer, that money could go direct to communities.”