By M K Dhar
With a mammoth Planning Commission and an army of experts at its disposal, it is surprising that the Government has still not been able to determine the criteria for identifying people living below the poverty line, who are entitled to relief under many welfare schemes. It took intervention by the Supreme Court to question the arbitrary methods used to identify those vulnerable sections who are actually poor and forgotten, though very much qualified to be uplifted form slums and relieved of hunger and starvation. The government spends huge public funds of raising the living standards of the most vulnerable and neglected people, without knowing whether they actually benefit. The Apex Court has even questioned why there should be a cap on the beneficiaries of subsidy or outright dole.
Based on the 2004-2005 income-expenditure survey, there are five estimated poverty ratios: 21.8 per cent; 27.5 per cent by the Planning Commission; 78 per cent from the Arjun Sengupta committee; 42 per cent from the World Bank and 37.24 per cent from Suresh Tendulkar. It has been found that poor households spend about 61 per cent of their earnings on food, irrespective of the poverty ratio. When there is no unanimity on this issue, it is surprising that the Planning Commission should have filed an affidavit before the court based on the Tendulker Committee report which pegs the monthly income poverty line at Rs 446, while the Lakdawala Committee had fixed it at Rs 356. Fixing the daily poverty line at Rs 26 for rural and Rs 32 in urban India is astonishing because the national daily minimum wage is Rs 100 (In Delhi it is Rs 200) and for Rs 26 it is not possible for a manual worker to even get a square meal — leave alone the 2,400 calories needed for him to survive, based on the ICMR standards.
The many anti-poverty measures have now become more targeted, like various subsidies, health, housing, pensions, help to children and adolescent girls to ensure their survival. To administer these schemes, a just and transparent system of poverty estimation and identification of the deserving is necessary without any scope for arbitrariness or discretion of those administering them. Unfortunately, the Planning Commission, with its army of experts, advisers and evaluators has used arbitrary and non-transparent methods to decode the criteria and estimates of poverty, which are now being questioned by the Supreme Court.
The Rural Development Ministry had in a 1992 survey, determined an income criteria of Rs 11,000 a year, leading to an assessment that 52 per cent of the people of the country were below the poverty line and hence deserving of relief. But this estimate was rejected by the Planning Commission with the result that no independent surveys have been conducted since then. Injecting discretion and arbitrariness in such matters encourages corruption and waste and the really deserving being left out, who continue to languish in poverty. The states indulge in arbitrariness in these matters and target such schemes especially at their political supporters and not necessarily the real poor and deserving.
The confusion over the issue and the Supreme Court’s direction have caused further embarrassment to the Government, which is already flooded with complaints that there is monumental corruption in the administration of the many schemes on which over Rs 100,000 crores are being spent each year. Apart from Minister Jairam Ramesh, some members of the Planning Commission too have questioned the arbitrary way of fixing poverty criteria. Though the general growth of the economy and increase in employment opportunities has raised rural incomes, the increase in national wealth has been offset by the corresponding increase in population and the number of poor, which remains more or less the same. One should not be misled by the advertisement campaigns by some chief ministers, such as, those of Uttar Pradesh, Bihar, Madhya Pradesh, Chhattisgarh and Rajasthan projecting as if poverty has been eradicated from their respective states.
To hide the failure of making a dent in poverty and make life bearable for nearly half the population, the ruling parties indulge in subterfuge and deception, present a rosy picture of their administration and blackmail the Centre over allocating more funds to them and not “discriminate” against them. This is a constant refrain of Mayawati and Nitish Kumar, in particular, and allocation of funds for their so-called welfare schemes is used as a weapon against the Centre and to perpetuate themselves in power on the basis of a sentiment of alleged discrimination by the Centre and the ruling party and to protect their vote-banks. The fact remains that there is misuse of the funds allotted to them by the Centre and the relief does not reach the intended beneficiaries. People belonging to castes supporting the chief ministers who own scooters, TV sets, refrigerators, gas-stoves and other household goods are classified as poor and given money by way of relief, while the miserable labourers working in their fields are denied the same.
As regards the battle within the Planning commission, member Mihir Shah regrets the lack of decision by government in the number of beneficiaries and their identification. The socio-economic census, currently under way will decide which households will automatically be excluded (income-tax payees, professionals etc) and which will be included (such as, those without shelter). The rest will be ranked, according to indicators of deprivation and provide the basis for prioritizing households for different programmes. To be entitled to food security, a person should fulfil two or three prescribed criteria, than an official cut off income. There is need to have programme-based lists, creatively using different parts of the data that will be generated by the socio-economic census, which should be completed by the end of the year. There will be no need for a Below Poverty List.
For instance, the government programmes for housing the urban or rural poor and for people with disabilities, could use different parts of the date base. This date that would emerge from the socio-economic census would be verified in the gram sabhas, so that the people have the opportunity to verify their personal data, which would also be placed on a website. The reason for the “shoddy affidavit” field before the Supreme Court is that it was prepared by those who have no political stakes. It is symptomatic of major differences within the government in the food security programme, with a powerful section wanting to reduce the numbers.
While BPL cards are provided by the states to the beneficiaries based on the field-level census, the fiscal support from the Centre to the schemes and those beneficiaries is decided on the basis of the Planning Commission’s poverty cut-off line. This force the states to bear the cost of subsidy if it wants to support the full number of people in the BPL list as per the census. In a sense, the Commission, by not responding to the specific questions that had been put to it by the Supreme Court, tried to mislead it. It has chosen to be silent on two crucial issues: one, on a request for the upward revision of the poverty line and, second, on not using the caps in determining BPL. There is force in the argument that there is need to assess the socio-economic characteristics of the households to identify the real poor, rather than simply drawing a line between the poor and the non-poor on the basis of income and expenditure to allocate resources for poverty reduction.
Inflation too has pushed many below the poverty level by reducing their consumption of food articles and expenditure on health and education. The Reserve Bank of India has relied on the sole instrument of interest rate hikes to make money dearer, but this has not worked. The general view is that inflation has been of the cost-push variety which cannot be attributed to excess demand and hence cannot to be tackled through making money dearer to reduce demand. Cost-push inflation is attributed to two factors: one, food price increases arising from demand-supply imbalances in agriculture and, two, high global commodity prices including oil and metals.
However, advocates of sharp rate hikes claim that inflation was persisting due to a wage-price spiral driven by inflationary expectations. While this may be partly true — though not borne out by the facts on the ground – it has not killed inflation, but it is gradually impacting the growth of the economy and has triggered a problem of insolvency among debtors. Demand reduction is already impacting industrial production, which is very bad for the economy. There is problem with management of food economy as well and there is no reason why people should go hungry when food production, has established a record. The Government appears confused and seems to have lost its grip over the situation, which further compounds the misery of the poor. [NPA]
