Open Forum

New Delhi, 8 July 2015

Welfare Schemes

FUND UTILISATION CRITICAL

By Dhurjati Mukherjee

The proposal to reduce the number of Centrally Sponsored Schemes (CSS) to 30-odd from the current 72, has assumed significance against the backdrop of the 14th Finance Commission’s award, raising the transfer of taxes to States from 32 to 42 per cent. It is understood that the amount of funds in each CSS which States can spend on their discretion within the overall parameters of the main scheme -- known as ‘flexi funds’ – has also been proposed to be raised to 25 per cent from 10 per cent.

The proposal has the unanimous approval of a sub-group of Chief Ministers set up by Niti Aayog. Headed by Madhya Pradesh’s Shivraj Singh Chauhan, the panel divided the CSS into two groups – core and optional schemes. The former would include legislatively backed schemes, such as NREGA, Swachh Bharat, Sarva Siksha Abhiyan, National Rural Health Mission, Indira Awas Yojana, poverty elimination schemes etc. The funding pattern of these core schemes would be 60 per cent by the Centre and the remaining 40 per cent by the States while those for optional schemes, the Centre’s and the States’ share would be 50 per cent each.  

The impact of this decision has several consequences. First and foremost, it is widely agreed that the efficiency of the Central Government is much better than most, if not all, State governments. Keeping this in mind, if the monitoring is left to State governments, there is every possibility of more corruption and lesser benefits to the targeted population. Secondly, with the curtailment of Central funds, most of the State governments may not actually give their share of funds but resort to unfair manipulation.

The logic that with the increased fund allocation under the 14th Finance Commission, the States would have to use these for welfare schemes may theoretically seem quite appropriate.  But in reality, the increased funds would only be used for short-term populist measures to gain political mileage and not help the poor and the economically weaker sections per se. It is well known fact that if welfare schemes were strictly monitored, the benefits to the masses, mainly in the rural areas, would have been far greater.

There is justification on the need for economic and/or financial decentralization that is, devolution of funds to the lowest tier of the administration. But given the political reality of the country where there is large scale corruption, devolution should be accompanied with strict monitoring to ensure best results. It is a fact that gram panchayats have very little decision making power and everything is decided at the State level or at best at the district level – zilla parishad.

It is significant to mention here that recently the Comptroller & Auditor General directed all States Principal Accountant Generals to get the Social Audit conducted by an independent organization of all Centrally sponsored welfare schemes to see whether the benefits actually reach the beneficiaries and the resultant effects of these schemes. The States may not like such action to be taken by the Principal AGs as would reveal the political interference, corruption and other negative aspects that obviously hamper the effectiveness of such schemes. As a result, not a single State as of now has gone for such independent audit by a professional organization.

The role of the private sector in India, either at the national or at the village level, leaves much to be desired. It has a record of cheating the Government in various ways, extracting benefits through dubious means and resorting to wanton corruption, mostly for their own benefit, sometimes in connivance with politicians. It is difficult to rely on them even when the interests of the poor and the economically weaker sections are involved but, there being no alternative, this is being done for most of the welfare schemes.

At a time when the Government is talking about more transparency and accountability, it is time that this is translated into practice. The welfare schemes have been formulated for a certain section of society who needs special help to bring them into the mainstream of life and activity. In this connection, the recent socio-economic and caste census (SECC), released recently by the Finance Minister, reveals that over 49 per cent of the 17.91 crore households in rural India may be considered under various welfare schemes, depending on their specific deprivation.

The degree of deprivation poses an intractable challenge to the present NDA Government if it wants to improve the living conditions of the poor. For example, the dismal scenario is illustrated by the fact that over 51 per cent are dependent on manual labour while 30 per cent of rural households own no land and 2.37 crore households live in one-room kuccha houses constituting 13.25 per cent of 17.91 crore households.

In such a scenario, it is thus imperative that the benefits of the welfare schemes must reach those for whom these are intended for. Only then can the desired effects of improvement in the quality of life of the lower segments of society take place. If the implementation mechanism is not strengthened, India’s emergence as a major power in the international scene may be greatly jeopardized.

Importantly, the country’s orientation of the planning strategy needs to change too. Being governed by bureaucrats, who mostly come from urban areas and from well-off families, the country has, over the years, not paid sufficient attention to the impoverished rural mass. And over and above this, most of the welfare schemes do not reach the targeted beneficiaries. In such a situation, how can one think of rural transformation?

Let us remember that Mahatma Gandhi had a clear strategy of rural rejuvenation. Sadly, that is now only in theory. Most political parties swear by his name but his ideological stand is not adhered to. The urban bias in Indian planning has led to the neglect of rural areas where majority of the country’s population reside. The different welfare schemes, announced by the Government, need to be properly monitored so that the benefits – whether in the realm of education, health, sanitation or housing – reach the beneficiaries. If there is a genuine urge to improve the socio-economic fabric of our rural areas and improve the quality of life of the villagers, there is need for strong monitoring, either at the Central or State level. Mere talk of ‘inclusive growth’ by all governments is no reassurance. ---INFA

(Copyright, India News and Feature Alliance)