Gareth Morgan says targeted welfare payments are needlessly complex, resulting in greater costs and many not claiming the benefits they are entitled to.

Gareth Morgan's The Opportunities Party is proposing a youth Unconditional Basic Income which pays everyone aged 18-23 $200 a week.

The $200 payment - which would be after tax - worked out to $10,000 a year, and would go to everyone regardless of income or whether or not they were studying. Unlike other benefits it would not drop off if a young person moved into employment.

It would replace the student allowance, which currently is tied to parental income and maxes out at $177.03 after tax for single people under 24. It would also replace the first $10,000 of any other benefits and the student living costs segment of student loans.

MONIQUE FORD/STUFF TOP's proposal would replace the student allowance.

Morgan argued the financial security this would provide would bring down rates of youth suicide and financial stress.

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"We are supposed to be getting more affluent every year, but these stats just keep getting worse," Morgan said.

The policy would cost $3.39 billion per year but TOP say they could find this money by cancelling National's tax cuts, savings on student allowances, and with money from the Budget surplus.

"As soon as [Joyce] said he was going to give himself and myself a tax cut I thought 'Ha, I've found some money!'", Morgan said.

He said it was key to keep the amount earned under what someone would make on minimum wage so people still had an incentive to work.

SUPPLIED The Opportunities Party has a UBI plan for babies as well.

It was the party's third Universal Basic Income (UBI) policy launch, following one for babies and the elderly.

Morgan argued that targeted welfare payments were needlessly complex, resulting in greater costs and many not claiming the benefits they were entitled to.

Young people were feeling pressure from rising rental and housing costs, a job market in constant flux, and tertiary fees.

"This is the cohort that has been pretty badly neglected by the political regime for a number of decades. They are subject to a lot of stress - the transition from the nest is not easy," Morgan said.

"Students are very loud, but they are actually only 30 per cent of the cohort. 70 per cent of the cohort do not go through tertiary education."

Morgan noted that Maori make up a much larger proportion of the age group - 35 per cent - than Superannuitants, who are only about five per cent.

"This is a revolution. We are saying that people in an affluent society are owed the ability to live their life with dignity."

"There is just no way bureaucrats can design complex systems (big data or not) that can cope with all situations in a cost-effective manner. Targeted witch-hunt welfare is dead, long live the UBI revolution," the party said in a release.

TOP said there were around 20,000 people in the age bracket who were not in employment, education. training, or receiving any kind of benefit.

The party want to eventually roll out a UBI for everyone.

If they make it to Parliament Morgan wants his party to sit on the cross-benches, offering confidence and supply support to whichever government promises to implement the most of his policies.

National party campaign chair and Finance Minister Steven Joyce rejected the idea.

"It's just the wrong message you're sending to young people that somehow you get a universal income," Joyce said.

"Our biggest problem at the moment is making sure we bring the young people who aren't yet in work into work. We've got so many jobs around this country."

He said most young people would either go into university study or realise there was "stacks" of jobs out there for the taking.

'AN EXCELLENT IDEA'

Economist and Christchurch City Councillor Raf Manji said the policy was an excellent idea.

"Especially when we look at the fact that we have basically UBI for over 65-year-olds and that has worked very well over the years," Manji said.

Introducing wholesale UBI for everyone would be quite tricky, so introducing small pieces of it made sense.

"In a way we are taking the 24-65 year olds out of the UBI system, which is the time when people usually have steady work."

The changing job market and rising rents meant young people were particularly at risk.

"It basically comes down to us telling our young people that we are willing to invest in you."

He accepted the argument that the youth suicide rate could be brought down by providing financial security.

"It also tries to get rid of this horrendous benefit system which puts a lot of stress on young people."

New Zealand Union of Students Associations President Jonathan Gee said the policy was a step in the right direction.

"Means-testing for student allowances has proven invasive, inefficient and unreflective of the financial independence of many young people. We welcome policies that look toward universality," Gee said.

TOP are polling about even with other minor parties at around 1 per cent.

There is a five per cent threshold for making it into Parliament.

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