Government's U turn on poverty line

By Richard Mahapatra
Published: Friday 25 May 2012

Goes back on commitment to delink social welfare programmes from poverty line

India's poverty line has been making news for the past eight months; all aspects of it have been discussed and debated threadbare. As if existence of 300 million poor in the country's official records were not enough evidence, two researchers flew in to try and live within the poverty line. Major parties decided to include poverty line's revision in party manifestos, not withstanding that “poverty eradication” has found mention in them for ages. Any publicity is good publicity till it serves its purpose, or so everybody thought.

On May 24, all the high decibel debates hit a wall when the government set up an Expert Technical Group to re-estimate poverty and create a new methodology for estimation. The promise regarding this was made in March 2012. The coverage in the media again overlooked the pertinent points while rewinding deliberations on what should be the poverty line. The obsession with Rs 26/day/person has made redundant two most important questions about poverty line: why do we need it and for what purpose?

A group of experts pointed out that social welfare programmes should be freed of the poverty line while pointing out that it is very low and excludes a large number of people from the programmes' purview. Another group of experts simply dealt with the poverty line measurement and overall poverty estimate that they found to be faulty.

In this chaos, we missed the point that the poverty line was never created to target development programmes and government entitlements. It is just to understand the long-term change in poverty figures. But when liberalisation was started in 1991, in a swift but calculated manner, poverty line became the sole condition for accessing entitlements and development programmes. India, for the first time in a formal way, split its population into two groups: below and above poverty line.

The current debate started in October last year when the government gave an affidavit in the Supreme Court saying Rs 26/day/person was sufficient to be considered the poverty line. It triggered a sharp debate which captured public imagination. In a major declaration on October 3, 2011, Jairam Ramesh, minister in charge of rural affairs, and Montek Singh Ahluwalia, deputy chairperson of Planning Commission, declared that poverty line would not be used anymore for deciding entitlements. “It is clarified that access to various government programmes and subsidies will not be based on this line,” both said in a press conference.

Such is the trap of this obsessive focus on just the figure of the poverty line, that when the government declared the constitution of the new expert group, the media missed the point again: the terms of reference of the new group indeed includes ways on how to use the poverty line for entitlements. Thus it has reversed its own commitment made just eight months ago.

One of its terms of reference of the experts group reads thus: “To recommend how the estimates of poverty, as evolved above, should be linked to eligibility and entitlements for schemes and programmes under the Government of India.”

This looks odd given that this group has been set up at the behest of the Prime Minister's Office, and the PMO gave this direction way back in December. In the mean time, a new poverty estimate was declared and immediately junked for the same reasons that forced the government  decision on freeing entitlements from poverty line. The Planning Commission further clarified on March 20, a day after declaring the new poverty estimate that was scrapped: “It is important to emphasise that the government has already stated that entitlements for food subsidy benefits will not be linked to the number of  persons estimated to be below the official poverty line. For the purpose of food security the size of the beneficiary population will be much larger and will be determined as per entitlements stated in the food security bill.”

So, why is this reversal now? If government doesn't want to link poverty to entitlements, why does an expert group have to deal with ways to do so?


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