By Avani Kapur,
Minimal budget increases for the social sector but a focus on infrastructure and capital expenditure seem to be the general theme in Budget 2021.
Yes, the capital expenditure needs a significant boost at both the state and central level, partly due to its multiplier effect on growth. However, in an unprecedented year of an unparalleled increase in health needs, an increased demand for employment amid rising hunger and inequality, the failure to ensure redistributive welfare is surprising.
India’s welfare architecture was an important reason for our ability to quickly deploy and mitigate the pandemic’s worst impact. This was amply witnessed in the provision of work through the Mahatma Gandhi Rural Employment Guarantee Scheme (MGNREGS), the existence of a large network of frontline workers across health and nutrition, the provision of food through supplementary nutrition, mid-day meal scheme and under the National Food Security Act (NFSA). Yet the budget has seen a decline across most of these.
For all the hype on the health budget, a closer look at the Ministry of Health and Family Welfare (MoHFW) shows that there has been only a 10% increase compared to last year's Budget Estimates and an 11% decrease from what is planned to be spent this year or revised estimates (REs).
Similarly, the allocation for National Health Mission, stated by the ministry as an important vehicle for emergency Covid-19 related expenditures, has barely risen. The revised estimates for 2020-21 saw only a 5% increase in nominal terms. This year, we see a mere 4% increase compared to the REs. In real terms these are negligible.
Similarly, despite the largest ever allocations for MGNREGS at over Rs 1 lakh crore during this fiscal year, the scheme continues to fail to meet the increased demand. With two months left in the fiscal year, expenditure is already nearly Rs 90,000 crore. With allocations falling this year to Rs 73,000 crore, the scheme is going to continue to mount pending liabilities or payments due.
An analysis done by the Accountability Initiative found that every year, allocations remain lower than requirements: a 47% gap in just supplementary nutrition alone. With the fifth round of the National Family Health Survey (NFHS) showing a decline in key nutrition indicators across several states and increased reliance on the frontline workers while handling the pandemic, this was an opportunity to give an important push to these schemes. Unfortunately, the finances do not tell that story.
There is no doubt that this Budget was unchartered territory. Yet, unprecedented times also call for unparalleled commitments. Unfortunately, the neglect of the social sector seems to continue this year as well.
(The writer is the Director of Accountability Initiative and a Fellow at Centre for Policy Research.)