Rights & roadblocks

Indian government uses public funds to alleviate, prevent and end poverty; but, unarguably, does so inefficiently. A new report from the World Bank for the Planning Commission on India’s “social protection” programmes outlines the scope of the failure and provides a few answers. Those programmes can be divided into three kinds, the report argues: those that prevent a slide into poverty, like social security and insurance schemes; those few that promote a rise out of poverty, like mid-day meals and conditional transfers like Nitish Kumar’s bicycle giveaways; and those that protect those who are nevertheless poor from the worst effects of poverty.

It is the last section which eats up most of India’s spending on the social sector, and is also the most inefficient, driven by the catastrophic, chronic failure of the public distribution system for food. Reform of the PDS is inevitable; but the report lists possible approaches. One is “incremental”, in which we tinker with those parts of the PDS that work least while retaining the overall model. Radical, fundamental reform would require a cash-transfer option when the state fails to provide grain. In between, there is an “intermediate” approach in which some deep-seated innovations are introduced to the existing system, such as smart cards. The report surveys these options conscientiously, but it winds up, of course, acknowledging that fundamental reform is the only sensible option for a programme that constitutes a large chunk of social-sector spending but benefits barely 40 per cent of those it is supposed to. Ruling that out for nothing but an idealistic rights-based attempt is “likely to leave many poor households with a stronger legal right but better a real-world situation”.

In a well-observed section, however, it lays out the roadblocks to such reform. The 450,000 employees of the Food Corporation of India and the 400,000 ration-shop owners, for one. The problem, too, of areas where food insecurity is chronic, where neither the state nor the private sector can reach — but also, the legal implications of existing Supreme Court decisions. The possibility of food security legislation with insufficient flexibility being passed is also listed as a constraint. Reform is necessary and inevitable; but a clear-eyed consideration of how to overcome these obstacles is necessary. And the first requirement is the political will to realise that food security doesn’t rule out reform; it requires it.