An obstinate refusal to focus on welfare
Source: The Hindu
For Prelims:
- Key Welfare Schemes:
- Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)
- National Food Security Act (NFSA)
- National Social Assistance Programme
- Saksham Anganwadi and Poshan 2.0
- Mid-day Meal Programme
- Budget Allocations:
- Trend of reducing welfare allocations as a share of GDP since 2014-15
- Exception during COVID-19 pandemic years
- Economic Indicators:
- About 34% of the population survives on less than ₹100 a day
- Over 81 crore people require free foodgrains
For Mains (GS II - Governance, Social Justice and Development):
- Welfare Scheme Funding Trends:
- Continuous decline in budget allocations for major welfare schemes as a share of GDP
- Impact on rural employment, food security, and social assistance programs
- Nutrition and Health:
- High rates of child malnutrition and anaemia in women and children
- Declining budget allocations for nutrition schemes despite persistent challenges
- Education:
- Decrease in central expenditure on education as a share of GDP
- Implications for education quality and infrastructure
- Healthcare:
- Slight increase in budget allocation for health
- High out-of-pocket expenditure on health remains a concern
- Fiscal Policy and Welfare:
- Impact of corporate tax cuts on fiscal space for welfare schemes
- Balance between economic growth and social welfare
Highlights of the Article:
- The article critiques the current government's approach to welfare spending, highlighting a trend of reducing allocations for key welfare schemes.
- It raises concerns about the impact of these reductions on vulnerable populations and critical sectors like education, health, and nutrition.
- The author contrasts the current approach with that of previous governments, suggesting a need for increased focus on welfare to achieve development goals.
- The piece emphasizes the importance of welfare spending in addressing poverty, malnutrition, and inequality in India
UPSC EXAM NOTES ANALYSIS
1. Welfare Schemes and their funding
- Since 2014-15, two of the government's major welfare programs—the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and the National Food Security Act (NFSA) (Food Subsidy)—have experienced a consistent decline in their Budget allocations as a percentage of GDP, with the exception of the COVID-19 pandemic years, when the government heavily relied on these schemes to prevent a major crisis. MGNREGA ensures 100 days of employment for every rural household, while the Food Subsidy provides free foodgrains to roughly two-thirds of the population.
- Last year, the NFSA accounted for 0.72% of GDP, but this year, its share has decreased to 0.63% of GDP—a puzzling decision in a country where over a billion people struggle to afford a nutritious diet and where only about half of the population eats three meals a day.
- Similarly, the budget allocation for MGNREGA this year is 0.26% of GDP, down from 0.29% last year. Currently, the combined Budget allocation for these two schemes as a share of GDP is 25% lower than it was in 2014-15 when the NDA first came to power.
- With rural wages stagnating and MGNREGA persistently underfunded, it is no surprise that rural distress is intensifying across the country.
- Additionally, vulnerable groups such as widows, the elderly, and disabled individuals living below the poverty line were largely overlooked in the Budget.
- The National Social Assistance Programme, which provides financial support to these groups and families who have lost their primary earner, received no increase in its allocation this year.
- In fact, its budget allocation remains unchanged from last year in nominal terms. Its expenditure as a share of GDP has decreased by half since 2014-15, dropping from 0.06% to 0.03%.
- The program offers meager pensions of ₹200 per month to the elderly and ₹300 per month to widows—amounts that have not increased since 2006, despite numerous appeals from economists. Even with a poverty line of ₹30 per day, these vulnerable groups would still be living at least 66% below the poverty line if left solely dependent on state support
2.Welfare and nutrition Schemes
- Recently, the Women and Child Development Minister acknowledged in Parliament that over half of children under five in India are affected by chronic malnutrition. Additionally, anaemia rates among Indian women and children are 20% and 15% higher, respectively, than the global average.
- The welfare scheme, Saksham Anganwadi and Poshan 2.0, aims to combat child malnutrition and hunger. In 2021-22, the Anganwadi programme was integrated with the Prime Minister’s Overarching Scheme for Holistic Nourishment (POSHAN) Abhiyaan and a nutrition initiative for adolescent girls.
- However, despite these additions, the Budget allocation for this scheme has dropped by more than half since 2014-15, decreasing from 0.13% of GDP to 0.06% in the latest Budget.
- To address malnutrition and hunger among school children, the government operates the mid-day meal (MDM) programme, which benefits around 12 crore children nationwide. Despite its success in improving class attendance, educational outcomes, and nutritional levels, the funding for the MDM programme has been reduced by half as a share of GDP since 2014-15.
- Furthermore, the Ministry of Finance rejected a proposal to introduce a school breakfast program in 2021, citing a lack of funds, despite its demonstrated success in Tamil Nadu.
- Given the severe malnutrition crisis among children, it is crucial to expand the coverage of these programs and ensure that children receive more nutritious food.
- The share of central expenditure on education (primary and secondary) as a percentage of GDP has also declined this year, dropping to 0.22% from 0.25% last year.
- Although primary school enrolment rates are high, significant progress is still needed in education quality and basic infrastructure. Therefore, it is troubling that education’s share of GDP has decreased from 0.37% in 2014-15 to 0.22% today.
- The only positive note is the slight increase in the Budget allocation for health, with the share of GDP allocated to the Health Ministry rising from 0.25% in 2014-15 to 0.28% this year. However, this increase is insufficient in a country where high out-of-pocket healthcare expenses push millions into poverty annually.
- Overall, the Budget allocation for all these schemes and departments has decreased from 2.1% of GDP in 2014-15 to just 1.53% this year. It is worth noting that this share was nearly three times higher—4.31% of GDP—during the COVID-19 pandemic year of 2020-21, highlighting the critical importance of these schemes.
- One estimate suggests that the government has foregone over ₹8 lakh crore in tax revenue since it reduced corporate tax rates in 2019. It seems that the poor and vulnerable have borne the brunt of the reduced fiscal space resulting from these tax cuts.
- It is not surprising, then, that India ranks poorly on the Human Development Index at 132, and that, according to a recent report by the World Inequality Lab, the country is more unequal today than it was during British rule
3. Conclusion
The current state of social welfare programs in India reveals a troubling trend of reduced budget allocations, particularly in crucial areas like child nutrition, education, and social assistance for vulnerable populations. Despite the demonstrated need and the proven success of schemes such as MGNREGA, Poshan 2.0, and the mid-day meal program, their shrinking share of GDP reflects a concerning shift in priorities. This is compounded by the government’s decision to cut corporate taxes, which has further constrained fiscal space, disproportionately affecting the most disadvantaged segments of society. As a result, India's human development indicators have stagnated or worsened, with the country now facing deepening inequality and persistently high levels of poverty and malnutrition. To address these challenges, it is imperative that the government reassess its budgetary priorities, reinvest in social welfare schemes, and ensure that the benefits of economic growth are equitably distributed across all sections of society. Without such measures, the vision of a more inclusive and developed India will remain out of reach
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Mains Practice Questions
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