By Mamata Pradhan & Devesh Roy
The build-up to the 2019 elections inter alia has been characterised by competitive claims of formulae and formula to address poverty with rallying cries of surgical strikes, final assaults and “it is achievable”. In these schemes of things, cash handouts seem to be of essence in the election season. In the market for disadvantage (demand for recognition and supply of solutions), social protection programmes play an important role. Social protection schemes are meant to mitigate the immediate impact of shocks (for example, price fluctuations) and smoothen consumption, over time. The thinking has also evolved to emphasise graduation and self-reliance where households are enabled to meet their needs consistently.
What is striking in the election discourse is the lack of footprint or sound bite regarding the long running and existing social protection programmes. Have we even once heard that we will reform the public distribution system of food or the employment guarantee scheme to make them more effective and more risk mitigating? Is the direct cash transfer of different types more salient for the poor? Is it an implicit acknowledgement that the current social protection ecosystem is broken?
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The aim of social protection programmes should be longer-term development and enabling people to move permanently out of poverty. Could a system like cash transfers per se, without increases in production and productivity, be a final assault on poverty? Sooner or later, Rs 6,000 will become insufficient or unaffordable and revisions or adjustments would become a holy grail that cannot be touched. There are several lessons from the current social protection systems themselves that need to be taken into account:
*Role of social programmes should be to address various vulnerabilities; hence they should be both objective-driven and community-driven rather than instrument-driven.
*From the policy perspective, we need to understand that institutions once created tend to persist. Hence, what gets introduced needs to be well thought over. If not, schemes will continue to be dominated by design and management issues such as targeting, coverage, leakages, fiscal and political sustainability.
Take the case of the Public Distribution System (PDS) for example. Despite being a universal right, control over ration cards has become a strong instrument for discriminating against women, the lower castes and the economically less powerful. For example, in our research in Bihar, Odisha and Uttar Pradesh on PDS, discrepancy in National Food Security card distribution was quite stark. In our surveyed sites in the tribal districts of Odisha, for example, the major issue was that many were left out from the ‘beneficiary list’, and these were people who earlier had a BPL card. While officials accepted that there has been confusion about the selection criteria, they did not have clarity on even the basics as to what they should consider as pucca (cemented) houses and kaccha houses, characteristics that were used as proxy means for selection.
This apart, several stories around the discrepancies in issuing cards were narrated which added to the women’s and lower caste’s struggle with the PDS. For example, one ST woman from an Odisha village who had availed of a house loan under the Pradhan Mantri Awas Yojana (PMAY) was denied a ration card, though the house does not even have a cemented roof. Another respondent had her name cut off from the BPL category and was included in the APL category since her two sons were studying in a government college. Yet another female respondent had not been issued the NFSA card since her husband was working as a helper in an automobile company and earning Rs 6,000 per month. Even in the long-running system i.e, PDS and with Odisha a comparatively well-functioning state, the identification of the poor is a first-order problem. All the cash transfer schemes will have to confront a basic question i.e, who is a poor and how well are they targeted?
Our research shows that a bottom-up, demand-led, evidence-based, sequential and iterative approach to social protection is likely to be more politically and economically sustainable than any, although well-intended, ideologically-driven initiative. Assessing how the system responds to changing conditions of vulnerability and aspirations across heterogeneous groups is the major thrust of the finding from our research. There is constant movement in and out of poverty and a top-down approach in all the proposed schemes is not likely to succeed. In case of PDS, in Odisha, for example, there was very little preference for direct cash transfers due to infrastructure and social trust issues.
There were major quality of services issues and it is a presumption that different cash schemes would be magically different, the possible political payoffs notwithstanding. In case of food subsidy, 94% of those from tribal Odisha districts do not prefer cash transfer over PDS. This is partly attributable to a lack of awareness about how banks operate, resulting in a fear of the unknown. Also, in the surveyed areas, the bank density is quite low. Additionally, there have been prior experiences feeding into this fear. In some Odisha villages, people did not receive money promised for building houses under the PMAY housing scheme. Additionally, the respondents were apprehensive of having to pay commission to the bank officials. They also thought that money might be misused, not just by men in buying local alcohol but also by women addicted to local tobacco. Since banks are far away, this translates into spending on transportation. Travelling and queuing up to claim their entitlement obviously involves both the opportunity cost in terms of foregone income opportunities and the time involved in the process.
Improvement or innovations in any programme are incumbent upon taking into consideration the demand side in order to ensure that the system is responsive to needs of stakeholders. The rationale for needs and preference assessment is that when programmes are well-aligned with the community’s needs and preferences, they can result in economically and socially desirable outcomes. When what is provided by the programmes is not in line with the preferences and needs, it can result in sub-par outcomes.
Pradhan is a professor at the University of East Anglia and Roy is a senior research fellow at IFP