This week has been euphoric in more ways than one. The spectacular cricket victory, Sensex touching a new high, and the India@60 celebrations in New York — all that has enhanced our sense of achievement and pride. To dampen these high spirits with talk of the reality of poverty may not seem popular. According to this week’s release from the ministry of labour and employment, poverty figures have improved: the percentage of poor people has come down from 26.1 per cent in 1999-2000 to 21.8 per cent in 2004-2005, based on the National Sample Survey’s (NSS) 61st round of household consumer expenditure. The survey also found employment growing at a faster rate (2.95 per cent) than population (1.71 per cent) over the period. Yet the recent report on ‘Conditions of Work and Promotion of Livelihoods in the Unorganised Sector’ presented to the government by the National Commission for Enterprises in the Unorganised Sector in August gives an unnerving picture. It appears that the number of extremely poor, having a monthly per capita consumer expenditure of up to three-fourths of the official poverty line of Rs 8.90 per day has come down from 31 per cent to 21 per cent. But the number of ‘marginally poor’ and ‘vulnerable’ has gone up significantly — they constitute 77 per cent of the population, “a total of 836 million people” having an income roughly below $2 in PPP terms. The ‘high-income’ group has also increased and totals 254 million, against 163 million in the early 90s. So has the ‘middle-income’ group. In short, the new India that is receiving global attention and that’s at the centre of new surveys on prosperity is of less than 300 million people, and while extreme poverty may have come down, the number of marginally poor and economically vulnerable is a staggering proportion of our population. What is worse is that a high percentage of this group comprises Scheduled Tribes, Scheduled Castes, OBCs, minorities, and Muslims. The commission believes public intervention is the answer and suggested two legislations — an Agricultural Workers Conditions of Work and Social Security Bill and a similar bill for non-agricultural workers in the unorganised sector, defining their rights and entitlements. The commission suggests that the entitlements — estimated outlay for the agricultural sector is Rs 19,400 crore and that for the unorganised sector Rs 12,950 crore — come from a proposed ‘National Social Security and Welfare Fund’. It says those below the poverty line needn’t make any contribution to the scheme; for the rest the schemes will be contributory. But the recommendations have received a somewhat cavalier treatment from the nodal ministry. The bills introduced in Parliament are an emasculated version of the proposed drafts and leave out the creation of a fund. These proposals need wider public debate before rushing through with legislation devoid of meaningful content. Second, India doesn’t have a social safety net for the unorganised sector. Do we need one with universal coverage? Is there a broad national consensus on its features, the implicit burden-sharing, as well as the fiscal choices involved? Third, while there is no substitute to sustained high growth for poverty elimination, it is clear that growth alone may not ensure desired outcomes. Well-targeted public intervention is inescapable. But we need to integrate and optimise our multiple and often overlapping efforts. Fourth, while reduction in extreme poverty is an index of our success, we cannot avoid revisiting issues of how poverty is defined. The commission recognises that revisiting the official poverty line is the “first step towards recognition of the multi-dimensional nature of poverty” and that it is perhaps overdue. But it has done little to dwell further on the issue and invigorate the ongoing national debate on poverty definition and amelioration. The National Development Council (NDC) is to meet shortly to approve the XIth Five Year Plan. We trust this plan will frontally address the many complex issues related to poverty, including the need for a broad-based National Social Security System. We can ill-afford to overlook the compelling needs of the 800 million people who remain poor and vulnerable even while we celebrate our new prosperity.
