Saturday December 7, 2019
Home Lead Story Is NYAY Going...

Is NYAY Going To Be A Game Changer for Congress?

The concerns about funds being used for harmful purposes cannot be ruled out. It is due to these challenges many policymakers suggest that instead of making welfare payments to poor households in the form of unrestricted cash transfers the government should focus on in-kind transfers.

0
//
Congress on Friday promised to create one crore jobs across the southern state
Congress state units given more power for 2019 battle- wikimedia commons

By Amit Kapoor & Manisha Kapoor 

The idea of launching Nyuntam Aay Yojana, a cash transfer scheme that intends to provide Rs 72,000 per year to the poorest 20 per cent Indian families, by the Congress Party if it comes to power, has stirred a debate among the policymakers about whether the move is economically viable or is just a tactic by the Congress Party to garner votes in the upcoming general elections.

The discussions are foreseeable, provided that this intervention to ensure basic income to the poor households will cost the country somewhere between 1.5 per cent to 3.4 per cent of GDP, a number higher than the government’s expenditure on healthcare and education. The implementation of NYAY means an additional cost between Rs 3.6 lakh crore to Rs 7.2 lakh crore per year.

To put things in perspective, the expenditure of the proposed scheme is 2.2 times the budget of all centrally sponsored schemes. The party claims that they have worked out all the fiscal calculations before launching the scheme. However, this will be a major dent in India’s budget expenditure and will explode the fiscal deficit from the current 3.4 percent to 6.8 percent.

money
An impact evaluation study by UNICEF in Sub-Saharan Africa showed that with the exception of temporary price rise during payment period, cash transfers has no impact on the prices. Pixabay

Apart from fiscal prudence, the other immediate concern surrounding the scheme is the identification of beneficiaries and the database that will be used for this. There is no official income database available with the government at the individual level and since most of the poor work in unorganised rural areas, there is no direct way of verifying their incomes such as through a payroll or income tax.

The proponents of the approach state that a good starting point could be Socio Economic Caste Census of 2011 if one goes by multi-dimensional aspect of poverty. However, one can’t ignore the fact that even if the scheme defines poverty by assets and not income for quick exclusion rules, the data is outdated. A scheme targeted at reducing poverty can’t use data that is seven-eight years old. Even if one ignores that, it should be noted that there are major methodological issues with how data was collected. This is reflected in the discrepancies that exist in the data collected through SECC and other governmental data. A fresh survey for the identification process will lead to possibilities of corruption as in other targeted schemes. For instance, various studies have shown that many people who are not below poverty line have BPL cards.

One should also keep in mind that there exist significant disparities across Indian states and districts in terms of income levels and affordability of basic needs such as education, healthcare etc. Therefore, the same amount that means a lot to a person living in a low-income state or a state that has good access to public facilities such as public hospitals, schools etc would not be enough for a person trying to make a living in a high-income region. As a result, a prerequisite for such a scheme is a detailed regional level survey on income characteristics of Indian states and districts.

money

To put things in perspective, the expenditure of the proposed scheme is 2.2 times the budget of all centrally sponsored schemes. The party claims that they have worked out all the fiscal calculations before launching the scheme. Pixabay

Another major concern surrounding the scheme is its inflationary implications. It is argued that the act of transferring cash to the target population will boost their purchasing power, which would lead to an increase in demand for goods and services and, thus, push prices upwards. Advocates of the approach have tried to argue that studies around the world present a lot of evidence to the contrary.

An impact evaluation study by UNICEF in Sub-Saharan Africa showed that with the exception of temporary price rise during payment period, cash transfers has no impact on the prices. However, these evidences should be considered with a pinch of salt. They rest on the assumption that the money will be spent on useful goods, that will help the local economy in becoming more productive. Though this will not be the case always.

Also Read: Food Unites People Across The Globe

The concerns about funds being used for harmful purposes cannot be ruled out. It is due to these challenges many policymakers suggest that instead of making welfare payments to poor households in the form of unrestricted cash transfers the government should focus on in-kind transfers. This idea is supported by claim that in-kind transfers will help by encouraging the consumption of right things, such as healthy food.

Given India’s concerns about rising unemployment rates, jobless growth and the fact that we need to have effective utilization of our young population to gain a competitive edge over other economies, the promoters are trying to project that NYAY can prove to be a game changer. However, for the Indian economy, a better alternative would be to strengthen the existing public services landscape by removing social, political and personal barriers, along with carrying out structural reforms that leads to creation of more productive jobs. (IANS)

Next Story

Measles Kills 140,000 people, WHO Calls it “Collective Failure”

WHO Decries 'Collective Failure' as Measles Kills 140,000

0
Measles- WHO
A child reacts after receiving a measles-rubella vaccination in Yangon, Myanmar. VOA

Measles infected nearly 10 million people in 2018 and killed 140,000, mostly children, as devastating outbreaks of the viral disease hit every region of the world, the World Health Organization said on Thursday.

In figures described by its director general as “an outrage,” the WHO said most of last year’s measles deaths were in children under five years old who had not been vaccinated.

“The fact that any child dies from a vaccine-preventable disease like measles is frankly an outrage and a collective failure to protect the world’s most vulnerable children,” said the WHO’s director general Tedros Adhanom Ghebreysus.

The picture for 2019 is even worse, the WHO said, with provisional data up to November showing a three-fold increase compared with the same period in 2018.

The United States has already reported its highest number of measles cases in 25 years in 2019, while four countries in Europe — Albania, the Czech Republic, Greece and Britain — lost their WHO “measles-free” status in 2018 after suffering large outbreaks.

An ongoing outbreak of measles in South Pacific nation of Samoa has infected more than 4,200 people and killed more than 60, mostly babies and children, in a battle complicated by a vocal anti-vaccination movement.

Globally, measles vaccination rates have stagnated for almost a decade, the WHO said. It and the UNICEF children’s fund say that in 2018, around 86% of children got a first dose of measles vaccine through their country’s routine vaccination services, and fewer than 70% got the second dose recommended to fully protect them from measles infection.

Highly contagious

Samoa Measles
A child gets vaccinated at a health clinic in Apia, Samoa. Samoa. VOA

Measles is one of the most contagious known diseases — more so than Ebola, tuberculosis or flu. It can linger in the air or on surfaces for several hours after an infected person has been and gone — putting anyone not vaccinated at risk.

In some wealthier nations, vaccination rates have been hit by some parents shunning them for what they say are religious or philosophical reasons. Mistrust of authority and debunked myths about links to autism also weaken vaccine confidence and lead some parents to delay protecting their children.

Research published in October showed that measles infection not only carries a risk of death or severe complications including pneumonia, brain damage, blindness and deafness, but can also damage the victim’s immune memory for months or years — leaving those who survive measles vulnerable to other dangerous diseases such as flu or severe diarrhea.

The WHO data showed there were an estimated 9,769,400 cases of measles and 142,300 related deaths globally in 2018. This compares to 7,585,900 cases and 124,000 deaths in 2017.

Also Read- UN Aims at Curbing Carbon Emissions Globally

In 2018, measles hit hardest in Liberia, Democratic Republic of Congo, Madagascar, Somalia and Ukraine, the WHO said, with these five nations accounting for nearly half of global cases.

Robert Linkins, a specialist at the U.S. Centers for Disease Control and Prevention, said the data were worrying: “Without improving measles vaccine coverage we’re going to continue to see these needless deaths. We must turn this trend around.” (VOA)