#Budget 2023: What is India’s Welfare Expenditure?
Government websites list hundreds of schemes. DBT Bharat lists 310 schemes run by 53 departments. NPCI lists 8976 user codes for schemes on direct benefit transfers. How many schemes do the Centre and states manage, what is being spent and what is the quality of outcomes?
By Shankkar Aiyar | Published: 29th January 2023 02:09 AM |
On Friday a petitioner urged the Supreme Court to declare that citizens have a fundamental right to directly petition the Parliament to deliberate and debate on important issues of public interest. A bench of Justices K M Joseph and B V Nagarathna sought a response from the central government and listed the PIL (Karan Garg vs Union of India and Others) for hearing after two weeks.
The idea is not without precedent. Citizens in the United Kingdom can petition parliament — 10,000 signatures gets a response from the government and after one lakh signatures the petition is considered for debate in Parliament. The right to petition Parliament is a question will draw attention as it underlines public perception that debates in parliament do not address issues haunting people and that elected representatives are not representing the interests of those who elect them.
A good place to start would be public expenditure. For instance what is the sum total of all the money that is spent on welfare by the centre and the states? More importantly what is the level or quality of outcomes achieved with the use of tax payer monies? Arriving at the number of schemes by itself is a challenge. For sure, websites of union and state governments list out schemes, covering an array of insufficiencies and deprivations. The programmes could be managed by either the Union Government, the states or could be a collaboration of the Union and States governments.
For instance the Ministry of Social Justice and Empowerment lists schemes for scheduled castes, scheduled tribes, other backward classes, for manual scavengers, for those with disabilities and so on. The Ministry of Rural Development lists a host of schemes under acronyms such as MGNREGS, PMAY, NSAP, SAGY, DAY-NRLM, DDUGKY, et al. The pensioners’ portal lists 28 schemes for senior citizens.
Add to this list schemes administered by the states on their own or with the Union Government. A good way to triangulate the number of schemes administered by centre and states is to look at Direct Benefit Transfers on the DBT Bharat portal. Now this portal classifies schemes by department. As per DBT Bharat 53 departments of government of India administer 310 schemes using the Aadhaar based DBT system.
The DBT system operates through the National Payments Corporation of India, a not for profit platform managing DBT and payments via the National Automated Clearing House. Data reveals the stunning volume of schemes and transactions. As per NPCI data, there are 8976 user codes for schemes using DBT — some of which are under same or similar names. The classification of entries — all India and States — suggests that 587 of these codes are for payments administered by the union government and the rest by state governments.
It is possible that not all user codes pertain to schemes. Equally it is instructive to remember not all schemes use the direct benefit transfer route. Many of the government subventions or subsidies are payments made directly to the accounts of beneficiaries. So how many schemes do the various governments manage? Aniket Doegar, a social impact entrepreneur who runs Haqdarshak, a tech platform enabling last mile linkage to prospective beneficiaries, says the exact number is hard to establish and could be around 20,000.
So what is the total expenditure — union plus states — on these schemes? The budget documents for 2022–23 reveal that the Union Government had allocated Rs 4.42 lakh crore for 50 listed centrally sponsored schemes. What is the total expenditure of state governments on social and individual subventions and subsidies? The answer is in the black box of government data.
The debate is not about the need for welfare. That the middle class feels left out of the gravy train is a separate political question for parties to address. The need for intervention is reflected in the data — in the 800 million covered by the free ration scheme, by the coverage of 500 million for health care under Ayushman Bharat and by over 151 million persons on the rolls of MGNREGS. The question is what is the quantum being expended and whether the allocations deliver the intended outcomes.
Questions galore! Should there be so many schemes? Can the schemes be harmonized? The issue of who must deliver what has surfaced in the reports of the Sarkaria Commission and in the report of the Punchhi Commission which had a task force on Centrally Sponsored Schemes and Governance. More recently, in December 2021, Bibek Debroy who heads the PM’s Economic Advisory Council averred that spending needs to be aligned with responsibilities listed in the seventh schedule of the Constitution and mooted the creation of a body like the GST Council for expenditure reforms.
This week Parliament will convene for the Budget Session. The Union Budget is essentially a financial statement laced with political intent. This being the final full budget of the Modi Government as India heads for polls in 2024 the focus is on how the government designs spending for transfer of electoral dividends. That is important but what is more critical is a holistic assessment of the quantum and the quality of spending on welfare. Would it be too much to expect a national outcomes statement every budget on taxpayer monies spent by Union and state governments?
A nation which is the fifth largest economy and the largest democracy must surely do better in assessing whether it is achieving what it intended to achieve.
Shankkar Aiyar, political economy analyst, is author of ‘Accidental India’, ‘Aadhaar: A Biometric History of India’s 12-Digit Revolution’ and ‘The Gated Republic –India’s Public Policy Failures and Private Solutions’. You can email him at firstname.lastname@example.org and follow him on Twitter @ShankkarAiyar. His previous columns can be found here. This column was first published here.