BJP’s Rajasthan manifesto signals rethink in welfare-spend

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Updated: December 7, 2018 1:08:28 PM

The BJP manifesto for the upcoming Rajasthan Assembly poll seems to have got it right in terms of how welfare spending must be shaped going ahead, to address changing realities.

BJP’s Rajasthan manifesto signals rethink in welfare-spend

Election manifestos are not always an indicator of future government spending or policy. But, the BJP manifesto for the upcoming Rajasthan Assembly poll seems to have got it right in terms of how welfare spending must be shaped going ahead, to address changing realities. With unemployment posing a daunting challenge—and likely to worsen with artificial intelligence’s impact on the employment outlook, especially for those who are not so well-skilled—BJP promising `5,000 per month to educated, unemployed youths is a critical step forward. More so, given the party had been openly averse to any such measure in the past. The BJP manifesto also talks about a universal basic income (UBI) that will be arrived at “after taking into consideration (the beneficiary’s) income from various sources and the government benefits (she receives)”. The manifesto also promises an urban employment guarantee scheme on the lines of NREGA. Against the backdrop of a suicide pact in the state in which three youths lost their lives and one was injured, allegedly because of not being able to find employment, such steps, if implemented, can prove truly revolutionary.

Rajasthan already has a government-paid medical insurance scheme—the Centre’s Ayushman Bharat scheme was based on this. While FE has been critical of the loopholes in the scheme, as a welfare measure to cushion the impact of growing vulnerability to medical problems, similar schemes are a must. Equally worrying is the issue of old age security, with most of the population not having enough savings for their old age. The government today offers old-age pensions, but this is only for the really destitute and is not a sustainable model, since it involves small doles paid out by the government and not the building of a corpus with beneficiary contributions. The BJP manifesto, unfortunately, makes no mention of whether the party will make the pensions a contribution-fed one for future beneficiaries; instead, it simply talks about hiking the amount. It also envisages creating special facilities for senior citizens in district headquarters that are equipped for assisted living, skilled nursing care, healthcare and entertainment. Whichever party forms the government in Rajasthan—and indeed, governments in other states—would do well to rethink the current pension model and create ways for beneficiaries to contribute to their own social security along with a sizable government contribution for the poorer sections.

All of the measures that the BJP is promising will put a huge burden on the fisc, so what is needed is for the government to radically rethink its welfare spending pattern. So, instead of having the Food Security Act or any other public distribution system, for instance, increasing spending on social security, unemployment doles, etc, would be a more efficient way to deliver welfare. Similarly, instead of all the procurement/price support and input subsidies to farmers, if they are given a per acre support, it would do their lot larger good. Apart from helping the poor, such a method of welfare delivery will also create a big enough market for suppliers of, for instance, medical services, farm inputs, etc. Very few hospitals come up in rural areas, given that those living there are not so well off. But with the government assuring payments via Ayushman Bharat, this will create a steady source of demand in rural areas.

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