Confused priorities hit welfare strategy
state-specific priorities be ignored? In recent years, states have emerged as important sites for social policy innovation and reform linked to state-specific political priorities .Will a direct line of accountability between Delhi and districts reverse this momentum?
Second, technology lies at the heart of this government’s welfare approach. Early in its tenure, Direct Benefit Transfer (DBT) through JAM (Jan Dhan-aadhar-mobile) emerged as the primary instrument for streamlining scheme delivery. The limitations of DBT, particularly in excluding genuine beneficiaries from accessing critical benefits like the Public Distribution System (PDS), are well known. But underlying this approach is the assumption that technology can be a substitute for governance failure. Rather than invest in addressing the roots of delivery failure - complex procedures, weak human resources, poor training – the focus has been on building technology infrastructure which will fail in the absence of key reforms.
Finally, this government has had to navigate a critical challenge – building welfare instruments relevant for India’s changing socio-economic structures going forward while managing present-day vulnerabilities. But it is yet to develop a coherent framework. For instance, India’s demographic transition and changing migration patterns requires a new framework for social security protection. In response, this government has focused on building a contribution-based portable pension architecture. However, a World Bank social protection report highlights that contributory schemes cover less than 10% of the eligible population. Irregular incomes, low awareness and difficulties in understanding complex financial needs even in states like Delhi have led to poor uptake. Moreover, these schemes do not address the challenge of strengthening existing social security schemes for vulnerable populations who cannot afford contributory schemes. In the rush to create new schemes, non-contributory pensions like the National Old Age Pension Scheme have been ignored; budgetary allocations remain inadequate and crucial administrative reforms to improve delivery remain undone. It is likely that the recently announced health insurance scheme – without critical investments in strengthening health systems-- is likely to fall in the same trap.
To sum up, in these four years, Modi’s welfare strategy has been one of confused priorities, grand announcements and ambitious targets, but ambition is unlikely to yield real benefits in the short term and without significant course correction may cause long-term harm.