Right to food, land, identity. Clashing approaches to social welfare come into sharp focus as the NAC prepares three new Bills for the Monsoon session. Rohini Mohan gets a ringside view of the tussle
TEA AT the prime minister’s house, anecdotal evidence suggests, can be anything from exciting to embarrassing. The two women and 10 men invited to 7, Race Course Road, in the summer of 2004, however, remember the understated tea for two things: a warm welcome and a cold warning.
First appointees to the National Advisory Council (NAC), the 12 activists, former bureaucrats and economists had just finished a fruitful meeting in their idyllic new office, another Lutyens bungalow a few metres away. Their chairperson, Congress president Sonia Gandhi, had encouraged them in a dulcet voice to set the developmental agenda for the UPA government, and to make sure promises in the election manifesto, the Common Minimum Programme, took the shape of workable welfare schemes. A few hours later, she led them to Manmohan Singh’s house.
After introductions and pleasantries, as the tea was being poured, the PM asked the group what they had talked about in their first meeting. A law that would guarantee employment in rural India, they replied. I hear it will cost Rs 35-40 crore, said Singh. After a pause he added, “Where will we get the money from?”
Seven years later, NAC members recall this money question as the earliest discordant note in their chaotic relations with the very government that created them. The council has since struggled against obstacles — monetary, ideological and academic — to the already onerous task of writing modern India’s code for social justice and transparency without stalling galloping economic growth. At its inception, the media, opposition parties and the NAC members’ own friends in activist and academic circles called the unelected body undemocratic. Not another group of advisers, moaned bureaucrats. Chaired by the Congress president and wielding more influence because of it, the NAC was also seen as Sonia’s way of meddling from outside Parliament after she abdicated the prime ministership to Singh. The editor of a leading newspaper called the NAC a dangerous group of “povertarians” with no political acumen or accountability.
The unpaid, voluntary group still sat, month after month, around the long table running across the thickly carpeted room in 2A, Motilal Nehru Road, drafting policies for rural, underprivileged India. “Each time the money question confronted us, each time we were accused of standing in the way of rapid economic growth with our poor man’s policies, we invoked the larger founding vision: inclusion and equality,” says NC Saxena, former bureaucrat and NAC member. “I guess it’s not surprising they call us jholawalas,” he laughs.
Despite the odds — and Sonia’s resignation as chairperson after she was accused of holding an office of profit — the first NAC (2004-06) managed to create the historic National Rural Employment Guarantee and Right to Information Acts. It brought the UPA back to power, and some of the criticism faded away for a while. Today, however, with a slightly changed team of 14, the NAC faces its most embattled hour. In this second round, disconcertingly, it’s dodging friendly fire. Primary opposition to several of the NAC’s latest policy drafts comes not from incensed editors or frustrated corporates, but from within. From the UPA-2 and the Planning Commission.
Three crucial ideas are stuck in this internal tussle: right to food, land and identity. They form the core of the three main policies the NAC is framing in its second term. The Food Security Bill, which by making access to food a legal right, seeks to eradicate hunger and malnourishment. The Land Acquisition Bill, which will protect the rights of those who lose land or livelihood to projects like dams, industries or roads. The Anti-Communal Violence Bill, which will protect linguistic, caste or religious groups under attack and punish authorities for inaction or complicity.
Each idea was born out of the deep shame and political drumming that arose out of a massive system breakdown in the past decade. Even as enormous sacks of rice and wheat rot in government godowns, one in four children is malnourished. West Bengal, Odisha, Maharashtra, Gujarat and Jharkhand burn as car factories, dams and steels plants try to displace thousands without adequate compensation for their land or even real consent for its sale. In Gujarat and Odisha, several policemen and legislators stood by or even participated as communal riots erupted around them, but eventually went scot-free. None of these complex issues can be fixed overnight, at least by law or a body of genial goodmen alone, but there is no denying that food, land and religion are at the centre of inequality, and the biggest conflicts in the country today. The NAC’s attempts to fix the breakdown, however, have led to intensely polarising debates.
In a dimly lit bylane in Adchini, Delhi, behind the snack shops, hardware stores and a small dumpster, is the office of the Centre for Equity Studies. As he enters it, Harsh Mander exclaims in an oddly unexclamatory tone that oh, he has forgotten to turn the music down! The room is filled with the sound of Beethoven’s soaring violins. It is a Saturday evening, and most of his staff has gone home, but Mander must prepare for the poverty and governance class he will take in IIM, Ahmedabad, the next day. “It’s challenging,” he says, “to make young people for whom GDP growth is common sense, to also realise that we live in a highly unequal society. To show them proof that an economy in which most of the citizens are worse off year after year is not likely to do well in the long run.”
What is most befuddling is what the Planning Commission has come to represent. The IMF manifesto?
Mander admits that sometimes, in NAC meetings with members of the rural development, tribal affairs, finance or HRD ministries, he finds himself repeating similar justifications for equitable growth.
“It’s frustrating. When I joined the civil services in the 1980s, the accepted role of the government was to protect the poor and disadvantaged people,” says Mander. “In 20 years, the ultimate role of the State has become to facilitate economic growth, and they have outsourced equity to a body like the NAC.”
In this shifting of roles, what is more befuddling, however, is what the Planning Commission has come to represent. Created in 1950 with the objective of promoting holistic development and effective utilisation of the country’s resources, the Planning Commission embodied the spirit of the Nehruvian era. Its first eight plans focussed on heavy industrial growth led by a strong public sector. After the late- 1990s, the Planning Commission has taken a diametrically opposite path.
The body whose mandate it is to set the government’s long-term priorities, has been mirroring the economic direction of a post-liberalisation India. Over the past two decades, it has been accused of doing this uncritically, for advising the abdication of State responsibility in several sectors, and for blindly pursuing a World Bank-IMF manifesto. Deputy Chairman of the Planning Commission Montek Singh Ahluwalia scoffs at such allegations, saying it is “grotesque to describe anything as the Planning Commission view. There are multiple views.”
Then why is there reason to have an NAC at all, a council exclusively for inclusion? What is the need for such a poor man’s council? It’s not to say the Planning Commission is anti-poor, but often, in the ideas of the NAC and the responses of several commission members or sub-committees, one can see the tussle for the kind of vision for what India should be.
This tug-of-war is nowhere as apparent as it is in the NAC-2’s first policy for the current term: the Food Security Bill.
Nearly half of India’s children are undernourished. During the two decades of sustained economic growth, the number of underweight children has not budged. At the moment, at least 17 programmes under five Central ministries criss-cross rural and poor India, directly and indirectly attempting to reduce poverty-induced endemic hunger. The Supreme Court has begun to intervene in the past few years too, banning export of foodgrain. In this atmosphere, the food security law is a radical attempt to make access to food a legal right for all.
‘When I joined the civil services in the 1980s, the accepted role of the government was to protect the poor and disadvantaged people. In 20 years, the ultimate role of the State has become to facilitate economic growth’
Special commissioner of the SC
An IAS officer for nearly two decades, and the Special Commissioner to the Supreme Court to advise it in the Right to Food case on hunger and State responsibility, Mander has been a member of the NAC since 2004. Fittingly today, he is the convener of the NACworking group that is drafting the Food Security Bill.
The latest NAC draft assures legal entitlement to subsidised foodgrain for at least 70 percent of the population or nearly eight crore people, with a monthly entitlement of Rs 7 kg for every member of families below the poverty line (called priority households) and Rs 3 kg to each individual from general households, made up of lower middle class families. Each member of priority households will be entitled to Rs 7 kg of foodgrain and will have to pay Rs 3 per kg for rice, Rs 2 per kg for wheat and Rs 1 per kg for millets. Every member of the general households will have the right to Rs 3 kg of foodgrain at a price not exceeding 50 percent of the minimum support price paid to farmers for each grain. All of this means an estimated subsidy of Rs 79,930 crore, and a foodgrain requirement of 55.59 million tonnes in the final phase in 2014.
UPA-appointed committees and the several Planning Commission members have opposed almost every one of the NAC proposals. It starts with how many people the law should cover. Initial NAC discussions proposed 90 percent of the population to be entitled to foodgrain, while the ministry for food and public distribution insisted on the other extreme: coverage only for people below the poverty line.
“That didn’t make any sense!” says agricultural scientist and NAC member MS Swaminathan. “We are already giving food to BPL families and so many people are left out.” This is something many Indian economists of different persuasions concede about the targeted public distribution today — that it is prone to exclude the needy or include the undeserving, errors that are far too grave when the goal is eradicating hunger.
‘No one has disputed that everyone has a right to be protected from hunger. The issue is what it takes to assure food security for all. That is where I feel that the initial vision of the Act has been severely diluted’
The NAC has been arguing for a universal PDS instead, one that allows anyone who wants subsidised rice, including the middle class, to go to a fair price shop and buy it. “Everyone has access, only at differently subsidised prices,” says Swaminathan. “If you can afford costlier rice, or you don’t like the ration shop wheat, you can always choose to buy from the market.” In economic parlance, it is self-selective.
COVERAGE is only part of the battle. Every step of the way, the Council has encountered a bottleneck. Even if the law was near-universal, and covered 70 percent of the population, it must demarcate a poverty line that will decide how many people will constitute the priority category, how many will be eligible for rice at the highly subsidised Rs 3 per kg. This has created a bizarre war of estimates. The NAC now relies on its own calculations, but initially quoted the Arjun Sengupta Committee report, which says 77 percent of the population lives in poverty. The first government draft Bill cleared by the Empowered Group of Ministers chaired by Pranab Mukherjee used a 2005-06 poverty estimate of the Planning Commission, which put the BPL ratio at 27 percent. In April 2010, Ahluwalia, however, backed the Suresh Tendulkar Committee report, which says 37.2 percent is poor. “We can’t even agree on how many people are poor,” laments Deep Joshi, NAC member and founder of Pradan, a livelihood NGO. Ambitious goals of right to food have been derailed by this basic disagreement.
AK Shiva Kumar
Even if a poverty estimate were agreed upon, for the welfare scheme to work, the poor need to be identified on the ground, and given BPL or smart cards to be able to collect the grains. For this, a BPL census is underway since June this year, which ranks the degree of poverty. It looks at socio-economic indicators like possession of a mobile phone, car, house, etc. The Union Cabinet, nevertheless, insisted that beneficiaries of the schemes be those identified by the Planning Commission, which computes a figure by looking purely at consumption expenditure.
It could be simply disparate views on methodology, but it has been perceived as the top-down arrogance of the Centre.
Several state governments are fuming, refusing to accept figures drawn in Delhi, while they have their local estimates. N Baijendra Kumar, spokesman of the Chhattisgarh government, explained that the Planning Commission cap on the number of poor goes against the idea of fighting poverty. Chhattisgarh provides subsidised foodgrain to 37 lakh people, 10 lakh more than the Planning Commission estimate for the state. “We don’t want to artificially reduce the number of poor just by changing the goalpost.”
Abhijit Sen from the Planning Commission says that if the states want to reach out to more BPL families, it can do so at its own cost. Andhra Pradesh, for instance, considers 80 percent of its population BPL, and Tamil Nadu provides subsidised grain for all. This upheaval should be irrelevant to the NAC, which holds states like Chhattisgarh as models for local procurement and suggests giving states greater freedom. But it has created a whirl of new opposition for the Council to tackle.
Fortunately, the Prime Minister’s Office, ministries, some states, the Planning Commission and the NAC agree on two basic things: that everyone has a right to be protected from hunger, and that the targeted PDS must go. In her address to Parliament on 4 June 2009, even the President explained that the Food Security Act would “provide a statutory basis for a framework that assures food security for all”.
“The issue is what it takes to assure food security for all,” says Jean Dreze, the development economist who conceptualised the first draft of the National Rural Employment Guarantee Act and till recently an NAC member.
The C Rangarajan Committee, formed by prime minister this January to study the NAC’s initial recommendations, concluded that it “will not be possible to implement the NAC recommended food entitlement”. It gave three reasons for this. One, food allocation to 75 percent of the population (as the NAC then proposed) would require 68.76 million tonnes of foodgrain, which it said was not available. Grain availability concerns have had economists like Commission for Agriculture Costs and Prices chairman Ashok Gulati suggesting that the government should not go in for a food programme that requires a commitment of more than 50 million tonnes every year. Two, stepping up grain procurement exponentially would affect market prices adversely. Three, the additional subsidy to cover three-quarters of the population would be Rs 35,000 crore, which was Rs 12,000 more than the NAC estimate.
Unavailability of food is a phantom fear. Since the mid-1990s, except for a couple of years, India has been a net exporter of rice and wheat. “We have on average, 60 to 65 million tonnes of rice and wheat stock every year,” says NC Saxena, a former bureaucrat and NAC member whose report on the Vedanta mining project in Niyamgiri, Odisha, led the government to revoke clearance. In 2007, in response to a petition on mountains of rotting food stock in Food Corporation of India godowns, the Supreme Court banned grain exports, and asked the state to divert the surplus to the poor instead. In short, there is enough foodgrain to go around.
All nuanced debate about food security reaches a dead end at the terrifically corrupt and unwieldy PDS
Dreze says Rangarajan’s advice is based on “a flawed argument, to the effect that higher procurement will push up market prices”. What the committee’s argument overlooks is that the upward pressure on market prices due to higher procurement will be matched by a downward pressure due to higher distribution. “The net effect could go either way,” says Dreze, “and is unlikely to be large.”
Every figure, method, report and proposal thus goes through a whirlwind of counter arguments and corrections. “I often wonder if it is the drawback of making law out in the open,” says Mirai Chatterjee, director of SEWA and a Council member. “Most of the fighting has been painful, but definitely constructive.”
‘Cash transfer is the answer. There’s a real problem in taking a system like PDS that’s known to be really corrupt, giving it highly subsidised commodities and expecting the grain not to leak into the market’
Montek Singh Ahluwalia
Deputy Chairman, Planning Commission
Again, there are varying positions. Ahluwalia insists that the only way to get around the PDS is by depending less on it. He insists that cash transfer is the answer. “There’s a real problem in taking a system like PDS that’s known to be corrupt, giving it highly subsidised commodities, and expecting the grain not to leak into the market,” he says. He suggests giving commodities at near-market prices and simultaneously “giving the poor an electronic entitlement”All nuanced debate about food security seems to reach a dead end, however, at the terrifically corrupt and unwieldy PDS. More distribution of food unavoidably means more dependence on the PDS, with its 45 percent grain leakages, rotting stock, and lumbering inefficiencies.
He illustrates it thus: say the government transfers Rs 13 to a person’s bank account or to their smart card. They can go to any store — PDS or not — and buy rice at Rs 2 or Rs 3, and also use the rest to buy oil or milk or eggs. The aim is also to gradually ease the poor man into the open market. “I’m not saying launch the scheme now,” clarifies Ahluwalia. “At least try it out in a few districts.”
The response in the NAC has been divided. When Narendra Jadhav, a serving member of the Planning Commission, who is also in the NAC, took Ahluwalia’s position, it created a rift in the council. Members like Mazdoor Kisan Shakti Sangathana founder Aruna Roy and Harsh Mander have long believed that cash transfers would lead to useless spending, and push the agrarian communities into great difficulties as government will stop purchasing grains from them. Dreze too has maintained that food is likely to be used better than cash.
The attractiveness of cash transfer, the NAC realises, lies in the directness of transfer, rid of intermediaries and in theory, rid of leakages and corruption. “But ease of transfer aside, if food security is about access to food, cash transfer only provides the buying power,” says Mander. People in remote areas with no ration shop, or grocery store will have no use for this mechanism. Although Ahluwalia is aggressively arguing for it, and it is being discussed wildly in academic circles, most NAC members feel cash transfers for food security are perhaps premature for India. They point to the lack of empirical evidence here that cash transfers will reduce corruption. If anything, the only Indian example of cash transfers — pensions — also has leakages.
An adviser who requested anonymity, rubbishes the mechanism Ahluwalia suggests. “It depends on three pre-requisites,” says the NAC member. “The smart card or UID, the accurate identification of people below the poverty line, and well distributed foodgrain. The first two aren’t here yet, and the third circuitously brings us back to the need for PDS reform.”
OTHER MEMBERS, however, admit to feeling forced to choose between extreme positions. Economist AK Shiva Kumar, who has served in both the NAC-1 and NAC- 2, believes that there is some merit in trying out cash transfers, but it is limited. “The question is: is it appropriate for the purpose at hand?” he asks. Under the nutritional scheme for pregnant women in the Food Security Bill, the NAC has proposed transferring Rs 6,000 to every pregnant women, unconditionally. But one cannot replicate this for mid-day meals, by giving, say, Rs 300 to every parent to pack tiffin boxes for their child. “I personally believe food security can be provided only by actually giving food, but we could be flexible and experiment in a limited way in with cash transfers in cities and places with established networks of fair price shops,” says Kumar.
The arguments on food security, as others faced by the NAC, swing wildly between ideas of fiscal prudence, expediency and deeply held convictions about the limits (or limitlessness) of state intervention. As the last NAC drafts of the food, land and communal violence Bills await Parliamentary debate, legal and economic fine print continues to be discussed to its bare bones, with every clause thrashed out in public.
Remarkably, even in the time of deep mistrust of the government, and also the fear of citizens’ engagement in public policy, it manages to stay in sustained, calm dialogue with the State. In doing so, the NAC has created a rare space for public deliberation before lawmaking. For an unelected group, the NAC could be standing for our most democratic ideals.
Rohini Mohan is a Special Correspondent with Tehelka.