The union budget for the year has been presented at a time of growing concerns that expectations regarding an inclusive recovery from the COVID and lockdown related economic crisis have not been realized for millions of poor households, while inequalities have been increasing sharply. There were therefore strong reasons for using this budget as an instrument for providing immediate relief to the bottom half of the population(which now has access to only 3 to 6% of the total wealth, according to various estimates, and only 13% of the total income of the country) for improving its prospects for sustainable and stable livelihoods as well as better access to essential services like education, nutrition programs, health and sanitation.
The work available under NREGA or National Rural Employment Guarantee Act can be very important for some of the poorest households in these difficult times. The allocation in the previous year was found to be adequate just for about just 40 days or so of employment. As NREGA stipulates the availability of 100 days of work and as the wage-rate as well as proportion of wage costs to material costs are broadly known, it is possible to find out the budget needed for the fulfillment of this legal obligation, once we assume that number of workers seeking employment will be the same as the previous year.
According to calculations made by the People’s Action for Employment Guarantee (PAEG), a budgetary provision of INR 271,000 crore is needed in the union budget for 2023-24 for NREGA to fulfill the obligation of 100 days of work for these workers. However this year only INR 60,000 crore have been allocated for NREGA, compared to INR 89400 crore Revised Estimate for the previous year, which is really shocking as such a low allocation was never expected.
National Social Assistance Program (NSAP) is by far the most important program for making available pensions to the elderly people, widows and disability affected persons in the unorganized sector. There is widespread concern over the stagnation in the budget for this program (leaving aside any allocation made under the COVID package) in recent years, despite the obvious urgency of this program. This year a big rise in NSAP was expected but the allocation at INR 9636 is even marginally lower than the allocation for the previous year.
Nutrition programs obviously have a high priority keeping in view the high levels of malnutrition. The government has been announcing plans for significant improvements without providing the budget for these, with the result that, not to talk of big improvements, even the maintenance of normal levels has become difficult. This year the budget for major allocations under food and nutrition are lower or stagnant.
Labor welfare is an important area of concern but the budget for important labor welfare schemes has come down. Budgets for important schemes of welfare of minorities too have suffered. Budget of schemes under Department of Empowerment of Persons with Disabilities has also suffered.
There is clearly urgent need for fiscal policy to make an important contribution to promoting inclusive recovery which provides relief to distressed people and also further creates linkages and a multiplier effect for broad-based economic growth. There appears to be a lot of agreement on the desirability of such a role for fiscal policy in India in these difficult times. The question is—whether the fiscal policy of the NDA government has actually been able to fulfill this need and expectation of people? Unfortunately the experience of recent budgets has been on the negative side and this year also the budget of the NDA government has failed to live up to the expectations of people.
Bharat Dogra is Honorary Convener, Campaign to Save Earth Now. His recent books include India’s Quest for Sustainable Farming and Healthy Food, Man over Machine and Protecting Earth for Children.