Quality, not quantity
If we make a bold attempt to make real deposits which will be valuable to parents after 20 years, we can have a great chance of stabilising the population of the country, says Naveen Jindal.india Updated: Mar 06, 2011 12:36 IST
By setting up the Jansankhya Sthirata Kosh or Population Stabilisation Fund (PSF), the Ministry of Health has recognised the urgent need to stabilise the country’s runaway population growth. There are many reasons why parents, especially from the under-privileged section of our society, want more than two children: they feel not all of their young ones have a chance of survival or if they have a single child, he/she might not have the wherewithal to care for them in their old age.
In this article, I would like to suggest an idea for population stabilisation that can address the problem of financial insecurity of old people and can lead to a more stable and manageable population. The plan can also be economical to the nation, if seen from the principle of opportunity cost.
It has been estimated that a lower middle class family needs about R10 lakh to take care of a child till he/she is 20 years old. This cost may be borne by parents, the government or society. However, if the same resource (R10 lakh) is used for strengthening our education and health systems and other social infrastructure, it can become an opportunity cost for thousands of others.
So for example, if a family has three children, they would need R30 lakh for bringing them up. On the other hand, if we spend R1 lakh on a couple who agree to some form of sterilisation after the birth of their first/second child, in the long run, we would save R10/20 lakh, which otherwise would have been spent on the one/two unborn children.
This investment of R1 lakh can be parked with the National Pension Scheme or any other financial institution. It can be expected to grow to over R10 lakh in 20 years. At the end of 20 years, the financial institutions could use this amount to pay an interest to the parents. One can reasonably expect them to get more than R1 lakh a year for the rest of their life. After the younger/surviving spouse turns 60, the scheme may permit access to the capital as well. The annual payment to the parents would be made irrespective of the status of their children and be a reliable form of old age security. The government’s PSF has done useful research and it too suggests a similar kind of deposit to benefit couples who opt for sterilisation.
The point that I wish to emphasise here is the nature of that deposit. I recommend that the government makes a deposit in the name of the parents (jointly or survivor) and to begin with, it can provide this incentive amount for a target of one lakh below poverty line couple every year. A rough estimate shows that if the total fertility rate is three and we are successful in sterilising one lakh couple after the first/second child is born, then the nation will save R20/10 lakh per couple respectively. The money that will be saved can then be spent in the form of increased outlay for services like health, education and infrastructure that would provide a better quality of life to the young citizens of India. If we make a bold attempt to make real deposits which will be valuable to parents after 20 years, we can have a great chance of stabilising the population of the country.
Naveen Jindal is Lok Sabha MP The views expressed by the author are personal