While critics have come down heavily on Chidambaram for writing off farm loans, his latest budget contains some commendable initiatives for the social sector Shivshankar Verma
Budgets have mutated far beyond the simple income and expenditure statements they were meant to be and have now become a grand platform for the government of the day to announce nation building projects, address short-term political compulsions, promote social justice and an attempt to leave a legacy.
As the canvas has become so broad, often it so happens that one proposal dominates all the discussions surrounding the budget while most others are ignored. This year, all the attention has gone to the loan write-off for farmers and, to a lesser extent, the lowering of income tax payouts for the middle class.
It is said that 'the devil is in the details'. This is often true of almost all government proposals, as benign looking initiatives can take altogether different shapes when the minute details come out. In the case of budgets, it can also be said that some proposals in an otherwise heavily criticised budget may smell of roses - when they are examined more closely.
The latest budget is no different and has many proposals which, if implemented and strengthened by the next government, can bring about real positive changes in the social sector. More interestingly, it is not that the finance minister has increased the social sector allocations manifold. But, some of the proposals are innovative and may herald a change of approach when it comes to social sector initiatives.
Skill development mission
When we look at the significant demographic advantage this country holds, and will hold for many more decades, the biggest concern is the unemployability of a majority of Indian youth entering the workforce every year. Like in many other areas, here too we are big in numbers but slip up when it comes to the quality of those numbers. An inadequate supply of skilled workers is also one of the most significant threats to sustained long-term economic growth.
While successive governments have attempted to tackle this, most of the initiatives have lacked ambition. Many of these steps were launched by different departments without any coordination, which dulled their effectiveness and the end results. Ideally, the ministry of HRD should have taken the lead and coordinated all the different initiatives. Unfortunately, the most unimaginative and inefficient minister in the cabinet always heads this most important ministry. Successive HRD ministers have wasted their time and effort in ensuring that those who lead high profile, top-class institutions remain servile to the ministry.
The budget proposal to set up a non-profit corporation to coordinate a national level skill development programme will address this problem in a big way, if the proposed corporation is allowed operational independence. This corporation should not be under the HRD ministry, but should be made answerable only to a committee headed by the prime minister. Another option is to expand the role of National Knowledge Commission and bring the proposed corporation under it. And there is no better person to head this initiative than Sam Pitroda, the current Knowledge Commission chairman.
The finance minister is targeting a corpus of Rs15,000 crore for the corporation and has set aside Rs1,000 crore as initial capital. Additional capital is expected from the private sector and multilateral sources, which should not be a problem if it is established that this is indeed a serious and committed effort. Hopefully, this initiative will get off the ground before the elections and future governments will increase support to it.
Primary and secondary education
When Rajiv Gandhi started the Navodaya schools, they were criticised as elitist and not significant enough to improve the schooling system in rural areas. While there is some merit in that argument, at the end of the day, these schools did open up educational opportunities - with facilities comparable to urban schools - for rural children. Ideally the government should have tried to upgrade the entire schooling system, but that is not an easy task as education is a state subject. A nationwide effort to upgrade all our schools would be a truly Herculean task most governments would shy away from. Navodaya schools were a more focussed effort to produce immediate results. The programme lost steam as subsequent governments did not provide sufficient backing.
After nearly two decades, the idea is now being revived. The budget has set aside Rs650 crore for a Model School Programme, with an ambitious target of establishing 6,000 schools. An additional 20 Navodaya Schools will be established, specially targeted at socially backward sections.
However, for these schools to deliver the results, the government should formulate a programme to train sufficient number of teachers. Though they lack even basic facilities, we do have a large number of schools in rural areas. But, the number of well-trained teachers is well short of requirements and has prevented any improvement in our school system.
The focus of Sarva Shiksha Abhiyan has been changed from access to and infrastructure at primary schools to improving quality of learning and retention. The allocation for the programme, which has been a rare success at such a large scale, has also been increased to over Rs13,000 crore for next year.
The decision to extend the mid-day meal programme to upper primary classes should bring down malnutrition among rural children and curb the rate of school dropouts. The extension of the scholarship scheme for upper primary students is a welcome step and future governments should look at expanding the scope of this scheme. The hike in salaries of anganwadi workers was long overdue.
The finance minister has also set aside Rs2 crore to upgrade the facilities of each of the 22 Sainik Schools. That is disappointing and shows a lack of imagination on the part of the defence ministry. Sainik Schools are the best possible source of supply for future officers for the armed forces. When a career in services is becoming increasingly less attractive, and the forces suffer a high attrition rate combined with a shortage of suitable officer material recruits, the government should spare no effort to increase the number of Sainik Schools to expand the supply base. Just 22 schools to groom future leaders for the nearly 2-million strong armed forces is pathetic.
The most significant initiative for higher education sector is the proposed establishment of 16 Central Universities across the country. Though there are concerns whether this will remain a proposal as the government will find it difficult to initiate work before the elections, the intent is appreciable. Usually, the biggest drawback of government initiatives is the inability to think on a big scale. Everything is done in measured, small steps so that by the time they are implemented, the projects are not sufficient to meet demand. In a large, fast growing country like ours, incremental capacity expansions are not enough.
Three more IITs, two more Indian Institutes of Science and two schools of architecture have also been announced. For institutions like IIT's and IIM's, it may be better to expand the existing ones rather than setting up new facilities. The student intake of our IIT's and IIM's are substantially lower than comparable schools in the US and Europe, which often have batch sizes of over a thousand each every year. Besides, the existing IIT's and IIM's have already created an environment of academic excellence which will be difficult to replicate at new institutes.
Having said that, it is high time the government does something to increase the availability of teachers for these institutes of higher learning. It is relatively easy to establish such facilities, but the critical resource for their success is competent faculty. A possible solution to this problem is to fund centres of advanced research at the established IIT's and IIM's.
Rural Insurance and housing
The new Rashtriya Swasthya Bima Yojana to provide health insurance to workers in the unorganised sector and the Aam Admi Bima Yojana to provide life insurance to poor, landless households are significant initiatives to provide a modest social security cover to those who are the most vulnerable. It is appreciable that the government is implementing such initiatives through organisations like the Life Insurance Corporation, which should increase their chance of success. The increased support to self-help groups
The decision to increase the housing subsidy for the poor by Rs10,000 to Rs35,000 and the proposal to make available bank finance of up to Rs20,000 at a concessional rate of 4 per cent for such housing should help the large number of household without a firm roof over their heads. If only the government had come out with an effective plan to increase availability of land for housing in urban areas to bring down land costs. Without such a plan, a home of their own will remain a dream for most of the urban population.
All in all, the finance minister has introduced some significant initiatives which should lead the way for future governments to undertake more comprehensive reform initiatives for the social sector. If future governments actually follow the lead, these initiatives will be the UPA government's biggest legacy.