The Washington Post reported yesterday that the IRS expects the per-child subsidies that passed in the American Rescue Plan in March are expected to start going out in July:
The Internal Revenue Service on July 15 will start delivering a monthly payment of $300 per child under 6 and $250 per child 6 or older for those who qualify. The monthly benefits will be deposited directly in most families’ bank accounts on the 15th of every month — or the closest day to that date, if the 15th falls on a holiday or weekend — for the rest of the year, without any action required. (my emphasis added)
For roughly 88% of eligible beneficiaries, there is no administrative burden beyond being surprised at the bank account being higher on the 15th of the month than it otherwise would be and trying to figure out why.
No action is required for money to show up via a social welfare program. This is markedly different than the maze of paperwork and validation steps that most of our other social welfare programs require. For the vast majority of recipients of this benefit, there is no administrative burden. Instead, the federal government which has the data, expertise and deep institutional knowledge of how to read the law and determine eligibility is taken on the cost of figuring out who is eligible and who is not. This approach means that far more people who are eligible for the benefit will receive the benefit.
Structuring public programs so that it is easy or hard to access can greatly determine both the success and failures of those programs as well as the political support for those programs. Social Security is a program where the federal government takes on the vast majority of the burden of tracking income and determining the size of checks for eligible participants. Conversely, Medicaid is a program where the individual is expected to routinely navigate a thicket of eligibility requirements on a recurring basis to determine eligibility even if the individual has filed relevant information to other arms of the government in the same time frame.
Decreasing administrative burden can be critical to improving program experience.