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Social sector funding in poor health

AESHA DATTA | Updated on January 27, 2018 Published on May 20, 2016

The dismal scene at a primary health centre, which is reflective of the low priorityaccorded to the health sector PTI

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The low priority accorded to public health and education is reflected in the steady cutback of budgetary allocations



Adherants of the big-is-beautiful model of development will have no reason to fault the Narendra Modi government. In the manner in which it has articulated its embrace of its signature projects – be it the Smart Cities Mission or the High Speed Railway project – and in its marshalling of scarce financial resource for these efforts, the NDA government has made its policy priorities abundantly clear. Its motto appears to be: the bigger, the better.

Just as eloquent has been the government’s according of a low priority for the bare minimum of social sector programmes that touch the lives of millions of the country’s poorest people.

Indicatively, the government started off by ridiculing rural employment guarantee programmes such as MNREGA. In a speech in Parliament in February 2015, Modi resolved never to discontinue the programme since it was “proof” of the UPA government’s “failings”.

“After so many years of being in power, all you were able to deliver is for a poor man to dig ditches a few days a month,” he said, his tone laden with sarcasm.

Subsequently, however, the government appears to have been awakened to the merits of the scheme and has made a show of increasing allocations to the project, which is widely acknowledged as a useful weapon in the battle against rural distress, particularly in times of drought.

Low priority for health, education

And yet, the government has been systematically scaling back budgetary allocations for the health and education sectors. In Budget 2015-16, for instance, the allocation towards health, which had plateaued since 2011, dipped substantially; the next year’s Budget saw no net increase in the allocation, points out T Sundararaman, Dean of the School of Health Systems at the Tata Institute of Social Sciences.

Spending on public health in India is already one of the world’s lowest, at under 1.5 per cent of GDP, but this cutback has impacted government health schemes, impairing basic functions such as supply of medicines and the ability to hire doctors.

Terming the situation a “crisis”, Sundararaman said the funds shortage had affected government schemes to control the spread of HIV/AIDS and tuberculosis, which could have serious health and economic repercussions.

One of the biggest problems with public healthcare is the lack of infrastructure, but in the absence of adequate funding for infrastructure, the government, acting through the medium of health schemes, pays for the treatment, tests and surgeries at private facilities, all of which cost more than they would in government hospitals.

Not getting the basics right

Anand Rai, a doctor and a public health activist who blew the whistle in the Vyapam scam in Madhya Pradesh, said that the impact of the Budgetary allocation cut may be mitigated if there was adequate focus on the basics of health: clean air and water, prophylactic treatments, and vaccinations. Rai points to another travesty: State governments pay for expensive procedures such as cochlear implants, use of cath labs and so on in private hospitals, rather then invest in developing cheaper facilities. “Taxpayer money is being spent indiscriminately,” he said.

“In Madhya Pradesh, under the National Rural Health Mission, ICUs were constructed for children, instruments were purchased, but there was no money to recruit doctors,” Rai said.

Promoting private providers

Two of the major health-related announcements in the latest Budget related to a national dialysis programme and a national insurance scheme. However, both of these piggyback on private intervention. This validates health activists’ arguments that the government appears to be focussed less on providing affordable healthcare to the masses and rather more on giving a fillip to private bodies in the healthcare space, which will push up the cost of medicare.

Additionally, under the terms of the 14th Finance Commission, the mechanics of revenue sharing between the Centre and the States has changed. While the States’ share has increased on paper, in many instances the actual amount made available to States has been very low, Sundararaman said. “There are many States where the Central budgetary allocation was the main source of funds, for instance in the North-Eastern states,” he added.

Further, under schemes such as the NRHM where the share of Central funds has come down from 75 per cent to 60 per cent, the State is now expected to contribute more to make up the shortfall. However, States have not been afforded any flexibility in the disbursement of the funds.

“Strictly speaking, the Central budgetary allocation should be made in consultation with the States,” Sundararaman said. The changes in the budgetary allocation process renders the States susceptible to pressures in the manner in which the funds are disbursed. Indicatively, in the absence of authority to employ health staff, State governments are constrained to outsource work.

Conflict of interest

GS Grewal, President of the Punjab Medical Council, said the government had made piecemeal announcements such as Jan Aushadhi scheme (under which generic drugs are provided at affordable costs), but had made no budgetary provisions to enable the infrastructure to implement the scheme effectively.

Grewal, who also spearheads an effort to implement a single national test for admissions to all medical colleges across the country, points to another problem that lies at the centre of the effort to regulate the medical education industry. “There are 80 Members of Parliament who have a personal interest in private medical colleges,” he says, pointing to a potential conflict of interest.

The Supreme Court has endorsed the proposal for a single medical test in the interest of weeding out corruption, but several State governments appear opposed to the idea.

“Health and education are universally recognised as two major pillars of every civilized society. Yet, here we find that the budgets for both have been progressively cut back. It is the biggest misfortune of this country that people’s health is being accorded such a low priority,” he laments.

Published on May 20, 2016
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