The ongoing national debate on ‘poverty line' betrays not merely the Planning Commission's thinking on the state of poverty and deprivation in the country but, more importantly, its “line” on how to overcome them. In fact, but for judicial interventions, the poor in India would have been subjected to even greater depths of poverty and deprivation, especially under a strident neo-liberal economic policy regime.

The poverty line that the Planning Commission (PC) has been following is more than three decades old. Never did it occur to the PC to review it in the context of the high and unprecedented economic growth in India until the pressure became somewhat embarrassing.

The Tendulkar Committee, set up in December 2005, took full four years to submit a report that resulted in a slight upward revision of the poverty line. By then, the findings of the National Commission for Enterprises in the Unorganised Sector, known as the Arjun Sengupta Commission, had shocked the country with its finding that more than three-quarters of Indians lived with not more than an average daily consumption expenditure of Rs 20 at 2004-05 prices. The Tendulkar Committee pretended that such a Commission never existed, proof of which was the way it chose to ignore its findings.

POVERTY AND DEPRIVATION

What the NCEUS report pointed out was much more. First, it showed that there is a gradation of poverty and vulnerability. Using the by-now-old poverty line, it showed that more than 6 per cent of Indians, i.e. 66 million, did not have more than Rs 9 for their consumption expenses and hence were categorised as ‘extremely poor,' another 15.4 per cent spent more than three-fourths but less than the official poverty line, and a further 19 per cent, were called ‘marginally poor' with just Rs 15 as the average daily consumption expenditure.

Interestingly, this threshold of Rs 15 in 2004-05 is equivalent to $1.25 in terms of purchasing power parity that coincided with the mean of the national poverty lines for the poorest 15 countries in terms of consumption per capita, as per a World Bank study. This was benchmarked as ‘extreme poverty' for comparison among developing countries. Evidently, the old as well as the new poverty line recommended by the Tendulkar Committee and accepted by the PC, is well below this international benchmark of ‘extreme poverty'.

There is also the other and widely referred international poverty line of two dollars per capita (PPP) per day for purposes of comparison among developing countries. So, the NCEUS computed another category called the ‘vulnerable' whose daily per capita consumption did not exceed double the old poverty line, i.e. Rs 24. To its surprise, it found 36 per cent of the population in this category and this was equivalent to the international poverty line of $2 (PPP). When all these categories were added, close to 77 per cent of Indians, totalling 836 million in 2005, were classified as poor and vulnerable.

The number shocked the country but the PC chose to ignore it. Subsequently, it sought to show that the computation was wrong, but in vain. These numbers got stuck in the public mind. However, from the point of the current debate and ongoing litigation, a few other dimensions are equally relevant.

FORGOTTEN DIMENSIONS

First, the PC's poverty line has remained stagnant until last year despite the long-term pattern in growth rate of around six per cent for the last three decades, including close to eight per cent during the last six years. In 1973-74, the poverty line was close to 58 per cent of the per capita income in India, which fell to just ten per cent in 2009-10. With the adoption of the new poverty line last year, it stood at just 12 per cent. Even if India adopts the international poverty line of $2 dollars (PPP) a day, that poverty line will only be one fifth of the per capita income. Second, the NCEUS brought out, quite unequivocally, the close linkage between poverty and social identity in that the incidence of poverty in the different bands closely follow a social hierarchy, the bottom of which is occupied by those belonging to the Scheduled Castes and Tribes of this country.

Third, such a linkage is further associated with informal work status — i.e. absence of employment and social security — as well as low educational attainment. All these dimensions raise more uncomfortable questions.

The PC's line on poverty that it is not meant as a filter for implementation of various poverty alleviation schemes will not have many takers. Of course, there are a few schemes where the Below Poverty Line (BPL) is not the criteria. But, then, there are many others where ‘BPL' has become a standard filter, beginning with the BPL-APL distinction in the Public Distribution System introduced by the NDA regime in the nineties.

The old-age pension scheme, the housing scheme for the poor known as the Indira Awas Yojana, and various schemes under the rural sanitation programme and urban poverty alleviation schemes use the BPL as the cut-off for entitlement. However, many state governments have found it impractical to follow such an arbitrary cut-off and ended up with extending these schemes to those whom they identify as poor and consequently take on the burden. This has been a strategy of the PC — passing on the additional financial burden of poverty removal, instead of addressing it as a national objective of the first order.

The announcement of the Union Minister for Rural Development, Mr Jairam Ramesh, that the PC's poverty line will not be used for determining entitlements under different schemes is a welcome one. He has cited the ongoing Socio-Economic Caste Census 2011 as a basis for deciding such entitlement that would take care of not only poverty but its linkage with social identity.

When an overwhelming majority is deprived in terms of food, there is a case for universalisation that could be based on transparent exclusion criteria. At the same time, there could be cases where a significant majority is deprived in terms of, say, housing condition or the availability of a private toilet. Or, it could be the case of anaemia among women. In such a scenario, poverty has to be viewed as a matrix consisting of a hierarchy of social groups with differential deprivations in select indicators of basic socio-economic security. That calls for a problem-specific approach to deliver, that needs to be delinked from the notion of the mechanical BPL-APL distinction based on consumption expenditure.

There is much to be commended on a universal approach for entitlement to a select band of basic socio-economic security. This will also eliminate not only the unnecessary cost of selection but also the room for rent-seeking in its various forms.

However, it calls for political will, something that is in short supply.

(The author was a member of the erstwhile National Commission for Enterprises in the Unorganised Sector. >blfeedback@thehindu.co.in )

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