The Hindu : Short shrift to social sector

Online edition of India's National Newspaper
Tuesday, Mar 04, 2003

Opinion

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Short shrift to social sector

CONTRARY TO THE claims of the Union Finance Minister, Jaswant Singh, the 2003-04 budget contributes very little to a direct attack on poverty and it pays inadequate attention to Government activities in the social sector. In other areas such as rural development, the Finance Minister has even decided to cut back on allocations to specific programmes, which is an ill-considered decision considering that the after-effects of the 2002 drought will be felt most strongly during the first quarter of the 2003-04 fiscal year.

The budget documents reveal that spending on the social sector in the current fiscal has almost uniformly been less than originally budgeted for. The year 2002-03 will end with Central Government expenditure on Plan programmes in the social sector about 5 per cent less than the budgeted Rs. 26,823 crores. The shortfall cuts across all social sectors. Spending, according to the revised estimates, has been less than budgeted in the areas of elementary and secondary education, health, drinking water and sanitation and tribal welfare. Unfortunately, elementary education is where the gap between budgeted and actual spending is the largest in the current financial year. These shortfalls could be due to two reasons. Either the individual Ministries have not been able to plan their spending properly or the Finance Ministry has chosen to cut back on allocations as part of a general attempt to control spending this year. Whatever the cause, the shortfalls reflect poorly on Government priorities since even today Central Government spending on the social sectors aggregates to less than one per cent of the gross domestic product (GDP). The one area, not included in the budget category of the social sector, which has seen a remarkable increase in spending in 2002-03 but where funding is unfortunately budgeted to return to the earlier low levels in 2003-04 is rural employment. The drought persuaded the Centre to increase expenditure on the Sampoorna Grameen Rozgar Yojana steeply, with the revised estimates showing outlays on rural development at as much as Rs. 15,195 crores compared to the budgeted estimate of Rs. 10,289 crores. There has, however, been no increase in cash outlays with the entire increment representing the cash equivalent of the additional cereals supplied to the States for the SGRY. It should be a matter of concern that allocations for the SGRY are to drop to the "normal" levels (Rs. 10,289 crores) next year. The monsoon of 2003 may be a normal one but under-employment among rural workers will not then disappear. With food stocks still twice the buffer norms it would have been possible to continue with an expanded SGRY.

The budget does provide for an 11 per cent increase in total outlay on the other social sector programmes in 2003-04, with the Central Plan expenditure rising by 13 per cent. A number of Ministries — health, education, drinking water, tribal welfare and women and child development — have received larger allocations for 2003-04 than what they have spent in 2002-03. But it will be up to these Ministries and the Finance Ministry to ensure that the pattern of expenditure falling short of allocations is not repeated next year. Only two new initiatives have been announced in the budget. One is the expansion of the Antyodaya Anna Yojana, the programme that provides cereals at highly subsidised prices to rural households surviving below the poverty line. The widespread success of the AAY in less than two years has persuaded the Finance Minister to provide an additional allocation of Rs. 507 crores in 2003-04. But the question is whether this is sufficient to take coverage by the AAY to the targeted 25 per cent of the rural poor households. The second initiative is the proposed group health insurance scheme, with the Government promising to subsidise premium payment of the poor. A group scheme is perhaps the only way in which the under-privileged can be covered by health insurance. But the public sector corporations, which now have to go solely by commercial considerations because they are competing with private companies in the insurance sector, will be less than enthusiastic about fulfilling the new social mandate that has been entrusted to them. It would therefore be quite an achievement if the target of a coverage of 5 million poor families is met in 2003-04.

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