Public Administration Mains 2018 : Model Question and Answer - 70
(Public Administration Paper II / Chapter: Significant Issues in Indian Administration)
(Current Based) Question: Why there is demand of reforming India’s welfare system for efficient redistribution? (20 Marks/250 Words)
The World Economic Forum (WEF) report discussed 60 per cent of Indian population poor according to the World Bank (WB) poverty line of 3.2 PPP (purchasing power parity) dollars per person per day. That a new welfare policy is needed is also made clear by the following calculation. There is, therefore, a distinct possibility of replacing leaky welfare expenditures with targeted cash transfers.
This bottom third of the population, we believe, should be targeted via a reformed welfare system, a system which emphasises redistribution through direct benefit transfers (DBT). The Unique ID number provides the base for a comprehensive reform of India’s welfare expenditure system. Elements of this have already been put in place, through the conversion of LPG and 84 schemes across 17 departments using DBT.
A comprehensive reform will ensure that every deserving person is identified and gets his/her welfare entitlement, with leakages minimised. The Budget must make an allocation usable by all welfare departments and district collectors to ensure that the residual gets an Aadhaar number, using photo ID if there are finger-print problems.
The gains from such a reformed welfare system are enormous, and the extra expenditure involved is minimal. A central message, for politicians and policymakers alike, is that India is no longer a “poor” country in the traditional World Bank dollar a day poor sense. That concept was there in the early 1990s.
India is today a lower middle-income economy, and should be thought of as such. It is the lower-middle class that should be the prime focus of policy, for both moral and political reasons; and the lower-middle class (the emerging middle class) is about a third of the population. (Total Words- 277)
Valuable inputs from The Indian Express Opinion: ‘Smart policies for redistribution’ by Surjit S Bhalla & Arvind Virmani
(Linkages: Welfare System and Efficient Distribution, Welfare System and Comprehensive Reforms, Welfare Expenditures and DBT)