UPA paper: Decline in poverty slower than claimed by NDA

The paper has also questioned the ‘‘comparability’’ of the 1993-94 figures with the 1999-2000 figures, while maintaining that ‘‘The preliminary estimates from the latest NSS thick sample in 2004-05 provides data that are fully comparable with 1993-94.’’ Acknowledging that the rate of decline in poverty is ‘‘at best modest’’, the paper points out that one of the key reasons is that ‘‘agricultural GDP growth has only just about kept pace with population growth during the last decade.’’ Though growth in non-agricultural GDP has been much higher, the trickle-down effect to the poor would have been much better if agricultural growth was faster, the paper suggests.

Accelerated overall growth, with a doubling of the agricultural growth rate, could expedite poverty reduction, ‘‘especially’’ if the UPA’s flagship schemes aimed at supporting incomes and welfare of the poorer sections like the National Rural Employment Guarantee Scheme are steadily expanded, the strategy paper notes. The paper also calls for a ‘‘comprehensive strategy for tackling poverty’’ that includes developing an appropriate social security net for the poor.

While pointing out that the financial viability of such schemes is critical, it goes on to urge careful examination of the ‘‘scope for expanding and reshaping existing (social safety) schemes and adding new schemes to improve the social safety net’’ while formulating the Eleventh Plan. Though many programmes like land reforms, old age pensions, the targeted public distribution system constitute elements of a social safety net, ‘‘we do not have a comprehensive social safety net covering the bulk of the population, including the population in the informal sector.’’

Though the UPA government can use this finding to justify spending for their flagship poverty-reduction programmes, the paper also states that the first two years of the Eleventh Plan would be ‘‘vulnerable.’’ The vulnerability arises from exogenous factors such as oil prices, which coupled with fiscal constraints imposed on the programmes, could compel a rethink on the statutory Fiscal Responsibility and Budget Management Act and its targets at both the central and state level.