Indian dream of a Welfare State
Commonomics

Indian dream of a Welfare State

Narendra M Apte

On 26th January 2020 we will celebrate seventy years of India becoming a sovereign Republic. Creation of a welfare state was one major goal as per various provisions in our Constitution. Question which needs to be asked in this context is: have we achieved that goal? Have we made reasonable progress to create a welfare state?

With an estimated number of some 10 crore families that are categorized as ‘Below Poverty Line’ or BPL families, in our country today, it is obvious that we are far away from realizing the goal of making our country a welfare state.

Incidentally, on 15th August 2020, we will be celebrating 73 years of our Independence. Hence, I think today is the right time to discuss how to make our Republic a true welfare state and what efforts are being made today so that we remain committed to the relevant provisions in our Constitution.

Conceptually, a welfare state is a form of government in which the state protects and promotes the economic and social well-being of the citizens, based upon the principles of equal opportunity, equitable distribution of wealth, and public responsibility for citizens unable to avail themselves of the minimal provisions for a good life.

A famous social historian, Lord Asa Briggs, in a classic essay on the British welfare state, had identified its three principal elements. These were: (a) a guarantee of minimum standards, including a minimum income, (b) social protection in the event of insecurity; and (c) the provision of services at the best level possible.

The above elements have become identified, in practice, with the 'institutional' model of welfare. Then there is the Scandinavian or Nordic model of social welfare which combines features of capitalism, such as a market economy and economic efficiency, with social benefits, such as state pensions and income distribution.

In mixed economy model, which we have adopted, both Central and State governments incur expenditure on many social security schemes, with a clear objective to ensure that the intended beneficiaries of such schemes actually receive the benefits. There are two questions for which we need an answer in this context. First is this: how do we ensure that there is the desired, good impact of welfare schemes on the BPL families? Second question is this: Can our governments spend huge sums on social welfare? Do they have the resources for incurring such expenditure?

With regard to welfare schemes targeted at BPL families, I find that there are many schemes but I think mention should be made here of three important schemes.

First is a scheme framed under the National Food Security (NFS) Act, 2013. This is an important legislation as it provides for coverage of upto 75% of the rural population and upto 50% of the urban population for receiving subsidized food grains under Targeted Public Distribution System, thus covering about two-thirds of the population.

The NFS Act has a special focus on the nutritional support to women and children. Besides meal to pregnant women and lactating mothers during pregnancy and six months after the child birth, such women will also be entitled to receive maternity benefit of not less than Rs. 6,000. Children upto 14 years of age will be entitled to nutritious meals as per the prescribed nutritional standards. In case of non-supply of entitled food grains or meals, the beneficiaries will receive food security allowance. The Act also contains provisions for setting up of grievance redressal mechanism at the District and State levels. Separate provisions have also been made in the Act for ensuring transparency and accountability.

Second welfare scheme is Pradhan Mantri Jan Dhan Yojana. This scheme is suitable for the economically weaker sections of the society who do not even have a bank account. Anyone belonging to the weaker section of the society can open a bank account under this scheme. Further, this scheme’s rules allow operation of zero balance savings account, debit card facility and accident and life cover of Rs 1,00,000 and Rs 30,000 respectively.

Third scheme is Atal Pension Yojana. This is a government backed pension scheme intended to provide pension benefits with a minimum contribution per month. This scheme is targeted to individuals belonging to unorganised sectors and provides pension benefits with a minimum contribution per month. Under this social security scheme, for every contribution made to the pension fund, the Central Government would also co-contribute 50% of the total contribution or 1,000 per annum, whichever is lower, to each eligible subscriber account, for a period of 5 years. But the subscriber has to contribute for a period of 20 years or more under this scheme.

Use of computers and internet facilities has considerably enhanced effectiveness of above three schemes. There is a very important and vital role of modern technology in successful implementation of all the three schemes mentioned above.

A literate population, particularly literate women, enhance the welfare of every society. Functional literacy programmes, both computer-based and others, are being widely used in our country to increase literacy level in many unreachable villages and more women are becoming literate. This is a welcome development.

Considering all welfare schemes which are in operation and taking into account various problems faced by the BPL families, like unemployment/under employment, poor health due to poor nutrition and lack of medical care, inadequate income from farming activities, it can be concluded that the goal of making India a welfare state like a Scandinavian country will remain a distant dream. However, we can certainly make honest efforts in that direction, despite resource constraints.

(Narendra M Apte, a qualified chartered accountant, is a freelancer.)

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