irony of equity: universalization of food subsidy is a recipe for disaster
onion prices are known to have led to fall of governments. Not because onions are too crucial for nutrition( though these a rich source of sulphur among other things) but because for many poor people, this is the only accompaniment they can afford with a chappati or rice. When decline of only 35 per cent in production leads to more than hundred per cent price rise, there is something fundamentally amiss in the public policy. It is ‘understandable’ that political parties in Maharshtra ( which supplies much of onions) have to raise funds for next election from traders and hoarders. It also makes ‘sense’ that agriculture minister will care more for his financiers than the consumers or even growers( most of whom do not benefit much from price rise) but what defies complete comprehension is why should government continue to deny the poorest their entitlement on priority and without fail. It is well known that whenever the government fails to spend budget for the poorest, it takes recourse to changing the definition, casting the net wide and diluting the focus on the poorest. let me illustrate:
More than two decades ago, when antyodaya model of focussing on the poorest heralded by Rajasthan was found difficult to implement by central giovernment, it argued that IRDP, rural development programme must be universalized, implement it every where. When RLEGP ( precursor of nrega) was found to be difficult to implement in backward regions where market wage rates were lower than minimum rates, universalization was resorted to, distorting the markets and pushing the pressure for mechanization and changes in cropping system even when productivity did not warrant it. So much so that when present dy chair of planning commission was just a member, they used a criterion to allocate rural development funds spatially by giving 40 per cent weightage to landless labourers in the scheme. Not realizing that the proportion of landless labour was much higher where land values were higher, productivity was higher and market wag rates were also higher( that’s why labour migrated to those regions). Ironically, where market forces were clearing demand for labour and thus the food, state wanted to intervene much better for completely expeditious reasons.
Universalization of food supply is a similar pretext advocated on account of simplicity, so called concern for the poor every where( disregarding that their conditions I not equally vulnerable everywhere), and showing political will to reach not just the poor but even others like you and me ( after all we also need subsidized food, who does not like subsidy!!). The result will be that poor in kalahandi and Narayanpur wil continue to survive on eating ants, tribals in arku will toil for two days to earn just 20 rupees a day if at all, to buy clothes, health services, mend house and seek education for children. Getting rid of extreme poverty is not in anybody’s interest, how many votes such poor tribal s have after all?
It is true that wastage of food grains stored in open is a crime against humanity ( particularly when privately constructed godown were empty in Punjab and were not taken on lease in many cases) but the answer to that is not depress the prices of local millets ( Jowar lost more than half the area in Andhra Pradesh after 2 Rs/ kg rice), or distort markets even when and where they are able to work better.
I am convinced that this kind of policy distortion will not save or serve any government, no matter of which party and where. We need to ask basic questions of morality too in this regard. Subsidizing undeserving ( reports say that 70 per cent people in rural areas are sought to be subsidized) is bad, be it in industry or rural or urban areas. There are better ways in which this money can be used to srev the real poor not just expeditiously but in manner that we can overcome rural and urban poverty of extreme form for ever. Let there be no ambiguity about the fact that universalization can be justified on any ground but not on the ground of poverty alleviation, fairness or justice. Data on uptake from PDS will also illustrate the inaccuracy of these assumption. In periods of severe drought, floods and other calamities, once can address the need for universality. But not because state is unwilling to address the problem of removing extreme poverty.
Anil K Gupta
