Counting the Poor

By fiddling with poverty numbers Indias ruling elite manages to reduce poverty For the mandarins of the Planning Commission poverty eradication is a simple matter of fudging the poverty criteria. Comfortably ensconced in air conditioned offices at Yojana Bhavan, the Commission headed by Montek Singh Ahluwalia, a neo-liberal guru, told the Supreme Court recently that people spending more than Rs 32 per day in urban areas or Rs 26 per day in rural areas were no longer poor and thus not eligible for welfare schemes. The Commission also suggested that spending Rs 5.5 on cereals, Rs 1.02 on pulses, Rs2.33 on milk and Rs 1.55 on edible oil per day was good enough to keep the people healthy.[i] The not so poor class Fiddling with poverty statistics has been a national pastime of governments replacing sincere attempts to eradicate it. Even the government appointed committees has returned higher poverty estimates much to the embarrassment of the ruling elite. The committee headed by Dr. N.C. Saxena (2009) said that the percentage of persons entitled to Below Poverty Line welfare benefits should be raised to 50%.[ii] The National Commission for Enterprises in the unorganized sector revealed that despite many years of economic growth, 77 percent of India's population continues to live on less than Rs. 20 per day, and that as much as 86 percent of India's workforce is in the unorganized sector.[iii] Even the Tendulkar Committee (2009) toeing the official line in poverty estimation raises the rural poverty to 42%. Dr Utsa Patnaik, a respected economist, lambasted the planning commission and the government for its flawed and unrealistic poverty estimates. She says By 2004-5 nearly twothirds of urban persons were in poverty, unable to spend enough to obtain even a modest nutrition standard of 2100 calories energy daily while the rural population similarly was not able to afford the official rural nutrition norm of 2400 calories and the poverty had reached 87 percent, the highest ever in three decades. She also accused the government of abandoning the nutritional levels of 2100 calories (urban) and 2400 calories (rural) to 1795 calories (urban) and 1820 calories rural.[iv] The hidden agenda of the governments low poverty estimates serves to lower social and welfare spending. As P.Sainath, the well known journalist explains The truth is the government seeks ways to spend less and less on the very food security it talks about. Hunger is defined not by how many people suffer it, but by how much the government is willing to pay for. Hence the endless search for a lower Below the Poverty Line (BPL) figure.[v] The parsimonious attitude towards social and welfare spending is reflected in the budget 2011 2012. The budgetary allocation towards food subsidy has been reduced from Rs.60,600 crore to Rs.60,573 crore. After taking into account inflation the subsidy ought to have increased anywhere between 10,000 to 50,000 crores. Spending on elementary education is a mere 11% of GDP amounting to Rs 2,700 crore while secondary education gets an increase of Rs.1,692 crore. Public health is occupies a low priority in spite of the hype. Central government spending on public health, which was already abysmally low at Rs2, 767 crore, is set to decline by Rs.607 crore. All the other welfare schemes have also suffered. The National Rural Employment Guarantee Scheme (NREGS), received a meager 100 crores. Indira Awas Yojana, which provides housing for the poor, was slashed by Rs.338 crore.[vi] Welfare state for the rich While poverty alleviation schemes are condemned as wasteful populism by the corporate dominated media, it remains silent about details of state subsidy for extremely wealthy corporate entities. On a conservative estimate, according to Sainath, In six years from 2005-06, the Government of India wrote off corporate income tax worth Rs.3,74,937 crore more than twice

the 2G fraud in successive Union budgets. The figure has grown every single year for which data are available. Corporate income tax written off in 2005-06 was Rs.34,618 crore. In the current budget, it is Rs.88,263 crore an increase of 155 per cent. That is, the nation presently writes off over Rs.240 crore a day on average in corporate income tax. Oddly, that is also the daily average of illicit fund flows from India to foreign banks, according to a report of the Washington-based think tank, Global Financial Integrity.[vii] If excise and custom duties exemptions given to corporate bodies (and not passed on to the consumers) are added up then the revenues foregone for the years (2005-06 to 2010 -11) comes to a mind boggling Rs 21, 25,023 crores (half a trillion US dollars) Apart from giant corporations reaping the benefits of Indias LPG dream (Liberalisation, Privatisation, Globalisation) the other beneficiary is the government itself. In a recent hike in the allowances of the Members of Parliament, each MP now gets around Rs.60,95,000 and if all the allowances and benefits are added up for the 534 MPs in the parliament for 5 years it comes to a whopping One Thousand six hundred crores plus.[viii] The ministers of the present government of the Congress have warded off the stigma of Below Poverty Line brilliantly. Praful Patel who presided over the liquidation of the national airline Air India is sitting pretty adding over half a million rupees every day to his assets in 28 months between May 2009 and August 2011. There were other brilliant performers like DMK's Dr. S. Jagathrakshakan, a Minister of state Information and Broadcasting, with Rs.70 crore increased from 5.9 crores declared in 2009. Milind Deora, MoS for Communications and Information Technology, almost doubled his assets between 2009 and 2011. He went from over Rs.17 crore to more than Rs.33 crore. . Over three-fourths of the ministers in the Union Cabinet are crorepatis.[ix] Not to be left behind is the Czar of Poverty estimation Montek Singh Ahluwallia himself. As the Deputy Chairman of Planning Commission he gets Rs 1.10 lakh per month with extra perks such as free medical benefits and rent free accommodation in Lutyens Delhi. His other colleagues (eight in number) of the planning commission cost the exchequer in the region of 11 lakhs per month excluding perks.[x] The losers of Indias hyped LPG story are the middle class itself. High fuel prices combined with high food inflation has left this class winded. To add to their tale of woes is the high cost of housing which has to be chased by high cost of borrowing. But the real losers of Indias spurious growth story are the poor who spend more than Rs 32 per day in urban areas and Rs26 in rural areas. Truly the damned, they have been consigned to the not so poor status and eternally condemned to scrape the bottom of the GDP barrel. C.R.Sridhar.

[i] TOI-21-09-2011 [ii] http://indiacurrentaffairs.org/recommendations-of-n-c-saxena-committee-official-povertyestimates-in-india/ [iii] http://en.wikipedia.org/wiki/Arjun_Kumar_Sengupta [iv] http://idathupaksham.wordpress.com/2010/01/05/the-tendulkar-committee-report-on-povertyestimation/ [v] http://www.counterpunch.org/2010/07/06/india-goes-on-strike/ [vi] http://www.frontlineonnet.com/fl2806/stories/20110325280601600.htm [vii] http://www.thehindu.com/opinion/columns/sainath/article1514987.ece [viii] http://viraj-patil.blogspot.com/2011/04/mps-salary-hike-latest.html

[ix] http://www.thehindu.com/opinion/columns/sainath/article2470835.ece [x] http://www.dnaindia.com/india/report_rs25-for-commmon-man-1366-times-that-for-monteksingh-ahluwalia_1590077 C R Sridhar