The economic slowdown has dented the UPA government's inclusive growth agenda in the last two years with the finance minister P Chidambaram focusing on fiscal management. But, the interim budget presented on Monday by finance minister P Chidambaram showed a renewed focus outlining the gains for India's deprived by following the Amartya Sen-Jean Dreze development path --- invest gains from economic growth for poor.
In fact, the spending on social sector, especially health, education and rural development had increased by 4.5 times since the UPA government took over in 2004-05. As a result, Chidambaram claimed 140 million people were taken out of poverty.
The Congress led UPA government increased its total plan expenditure --- half of which is spent for social expenditure --- from Rs 1,32,291 crore in 2004-05 to Rs 5,55,322 in 2013-14.
"Ten years ago, there were 51,511 kms of rural roads under Pradhan Mantri Gramin Sadak Yojana (PMGSY), today we have 3,89,578 kms. Ten years ago, the Central government expenditure on education was Rs 10,145 crore; this year, we have allocated Rs 79,451 crore. Ten years ago, the Central government spent Rs 7,248 crore on health; this year, it will spend Rs 36,322 crore," the finance minister said.
The plan allocation for the next financial year (2014-15) has remained same in the interim budget with Chidambaram increasing allocation for key social sector ministries such as health, education, minority affairs, women and child development, tribal affairs and housing and poverty alleviation.
In the hindsight, it appears that the Centre increased funds but failed to adequately restructure its funding pattern to cope with the changing ground realities. The UPA finally brought in a change with introduction of flexi-fund to be initiated from the next financial year.
Chidambaram announced a Venture Capital Fund for Scheduled Castes, a national agro-forestry policy 2014, a mechanism for marketing minor forest produce, Rs 100 crore to promote community radio stations and health ministry new technologies to people --- a JE vaccine, a diagnostic tool for Thalassaemia and a Magnivisualiser for detection of cervical cancer.
He also declared Rs 1,200 crore as Additional Central Assistance to north-east, Uttarakhand and Himachal Pradesh, reiteration of the UPA's committee to unique identification number or Aadhaar project to empower the poor and renewed focus on skill development to make the most of demographic dividend. The states will get Rs 338,562 crore in 2014-15 as against Rs 1,36,254 crore in 2013-14 as result of restructuring of the Central sponsored schemes (CSS).
Yamini Aiyar director of Accountability Initiative that tracks the government's spending said the UPA increased its social sector allocation from 5.33% of the GDP to 7.09 in 2012-13, which was significant, and moved from "patronage" based citizen-state dynamics to a framework of rights and responsibilities. "We have seen little in terms of moving from intent to implementation…the UPA has done almost nothing to initiate this transformation," she said.
Ajay Chhibber, director general of Independent Evaluation Office, a body set up by the Planning Commission to evaluate social sector schemes said people wanted quality in implementation of welfare schemes and gave example of school education, where parents are shifting from government schools to private ones.
Like schools, the UPA's massive rural health expansion programme was also hit by quality of service resulting in health costs becoming one of the main reasons for indebtness. The National Sample Survey Office study said that a person in India has to bear 62% of health cost from his or her pocket.
The government had initiated some corrective steps with the Union Cabinet approving free medicine scheme for the poor and starting medical colleges attached with district hospitals. However, its impact will be visible much after the 2014 general elections.
One of the biggest social security programme introduced was Mahatma Gandhi National Rural Employment Guarantee Scheme, in which about Rs 2,00,000 crore has been allocated since 2005. MGNREGA, introduced during UPA-1, did not find mention in Chidambaram's interim budget speech.
Chhibber said the impact of massive increase in spending was not visible as the government programmes focus on expenditure rather than outcome. "Most of the schemes are run in the way it was done 20 to 25 years ago. The schemes are increasing without much focus on its implementation and outcome," he added.
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