The
Planning Commission of India, in a press report earlier this week,
announced that Poverty in India declined to a record 22% in
2011-12. it claimed that the poverty ration had dropped from
37.2% in 2004-05 to 29.8% in 2009-10.
In
response, The Hindu reported that the Ministry of Rural Development
is following a methodology, derived from the Socio-Economic and Caste
Census, that will place at least 65 % of the population within the
ambit of various social protection schemes.
"Economists
advising the Ministry of Rural Development have told The Hindu that
the exclusion criteria to be derived from the ongoing Socio-Economic
and Caste Census are likely to leave out the top 35 per cent of the
population while the bottom 65 per cent will be considered BPL."
Tellingly,
N.C. Saxena is quoted as saying: “This is a step away
from the narrow definition of poverty we have been using, where the
line is really what I call a ‘kutta-billi’ line; only cats and
dogs can survive on it,”
In
another column, in Business Standard, N.C Saxena argues:
"Estimating
the scale of poverty with respect to a fixed poverty line - which was
Rs 1.63/1.90 per capita per day for rural/urban populations in
1973-74, and since then has remained unchanged after adjusting it for
inflation - is still relevant for many purposes, including judging
whether the development process is helping the poor and how fast
poverty is declining over time. It also helps to assess which states
are doing better in poverty eradication."
He
also responds to apprehension that the new poverty statistics are
going to be used by the govt as a tool to limit social spending:
"Out
of about 150 centrally sponsored schemes, only one scheme of old age
pension is linked to the below poverty line (BPL)
categorisation. Many centrally sponsored schemes, such as the
National Rural Employment Guarantee Act, Integrated Child Development
Scheme, Mid-day meal, National Rural Health Mission, and Sarva
Shiksha Abhiyan, are universal, whereas some others such as the
Indira Awas Yojana use a more complex formula. The subsidy on the
construction of toilets is also not linked to the household's BPL
status. Therefore, reduction in poverty will not reduce the
government's obligation to allocate money for the social sector.
Civil society's fear on this count is unfounded."
At
the same time, he admits that "the estimates for
the number of poor should be reworked by taking into account their
deprivations and living conditions, such as access to basic services,
shelter, public health, and education...The present cut-off is surely
too low, it could be called the destitute or starvation line"
His
skepticism on poverty lines for social spending is echoed, albeit
from the opposite end of the ideological spectrum, by Nitin Pai from
Takshashila Foundation who claims
that poverty lines cannot be effective instruments for targetting
beneficiaries for social welfare schemes:
"What
the poverty line is not good for is as a selection tool to identify
beneficiaries for entitlements. This is because it is practically
impossible to estimate whether a particular person earns more or less
than the given poverty line income. This fact is lost on many
policymakers and intellectuals—just how does one assess whether a
person earns less or more than Rs 33 a day? There are no objective
methods to test and verify incomes—no financial records, salary
slips, bank accounts and so on. So we are left with self-declaration.
However, if people know that those deemed below the poverty line will
receive benefits from the government, they are likely to declare
themselves poor. To take one example, in 2006, 91% of the families in
Karnataka state declared themselves below poverty line."
Another
useful resource is Rathis Balakrishnan's summary
of different methods adopted in India for bench-marking poverty.
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