Social Sector Spending

Over the past few years spending on social sectors by the union government is either flat-lined or reduced. Examine its implications on social sector and critically comment on changing priorities of government at the cost of social sector. (200 Words)

During the last few years, govt spending has largely increased on industrial front, so as to gain economic development as fast as possible. This has led to a neglect of the social sector reforms, like the health sector, pollution, education, sanitation and housing problems in urban areas.
This has led to:
  1. A high level of inequality in development of industrial and social sector, with the rich and the poor difference increasing further.
  2. The negative externalities have increased with the rising pollution and the consequent disease spread, leading to an increased cost of living imposed on the society.
  3. The delays in implementation of schemes like Swacch Bharat Abhiyan and irregular salary received in MGNREGA, have increased unrest among a large section of the population, leading a lack of faith on the govt.
  4. Due to lack of attention given to issues like child labour, export sector is also affected to some extent, as several countries refuse to buy products which involve exploitation of children, in the production process.
According to the govt, such neglect is justified by looking towards the top to bottom approach, as such approach helps the lower sector development when the upper sector has enough money to invest in such society beneficial schemes. The economic progress is supposed to trickle down, where when the industries progress, they will have more production opportunities, will employ more people and consequently, people will have more options to raise their standard of living.
But such approach is rarely seen as effective, as the industrial sector is least bothered about the progress of the society, whatever profit is incurred is invested back into the industry, or is shipped abroad in the form of black money. So, it again comes down to the govt to think of the society in general, and implement such schemes which can help in social sector reforms.
Instead of the top to bottom approach, a decentralised approach is needed in the country while giving adequate budgetary aid, where the implementation process can be audited at the ground level, leading to least possible leakages in the allocated budget and consequent improvement in the social sector
When it comes to providing social protection to its citizens, it is said that India’s record is abysmal. Critically analyse the status of social protection available to India’s citizens.
The social protection available in India can be divided under 6 heads:
  1. Children’s education, nutritional status and health. The Right to Education Act (2009) provides specific entitlements to children to free schooling.
  2. Employment and Livelihood Security. Schemes like MGNREGA, skill development and labour reforms have been initiated.
  3. Social Pensions. The recently launched trinity of Suraksha Bima Yojna, Jivan Jyoti Bima and Atal pension yojna along with Jan Dhan yojna may prove to be a game changer if maximum coverage is attained
  4. Social Health Protection. A draft health bill is under way but govt. spending on health services has been below par. This has been identified as one of the major reason for poverty. Schemes like health cards, swasthya bima yojna are avaible.
  5. Food Security. The National Food Security Bill proposes to give an entitlement of subsidised cereals to up to 75 percent of the rural population and 50 percent of the urban population.
  6. Housing. The goal to provide housing for all by 2022 has been set in this direction apart from the schemes.
  1. In terms of social sector spending as a percentage of GDP, India comes last among the BRICS nations. That Bangladesh performs better than India in this segment, is a telling sign.
  2. Despite the presence of pension schemes both at the Centre and the State level, pension is received by less than one-fourth of the eligible population.
  3. While India has a fairly vibrant insurance sector, it has one of the lowest insurance penetrations. When it comes to insurance products and services, while, the high and middle income households are spoilt for choice, low income households has little or no options available.
  4. The situation is similar when it comes to health coverage. In fact, the lack of reliable public health services and the absence of health insurance compel the poor to spend heavily on private medical care. This only exacerbates their already precarious economic situation.
The biggest gap in India’s social security fabric seems to be the absence of social protection of the poor working in the unorganized sector. Therefore, the need of the hour is a universal social security net, which covers the workforce engaged in both organized and unorganized sectors and shall include at the very least social insurance, social assistance for life, health cover and old age benefits.
In this light, the recently launched PM Suraksha Bima Yojana, Jeevan Jyoti Yojana and Atal Pension Yojana besides the further opening up of the insurance sector for FDI are some commendable efforts made by the government.



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