[The last time, Modi invested a lot in selling dreams. Rs 15 lakh, 2 crore jobs annually, Gujarat model of development ... "Sab Ka Saath, Sab Ka Vikas!" This time round, his USP is: stirred up sense of insecurity, worked up hate and consequent anger. That's almost all. Completely forgotten is: "Sab Ka Saath, Sab Ka Vikas!" Even stand-alone "Vikas" is, at best, a stepchild, if at all. Nothing more.
<<Congress president Rahul Gandhi’s announcement of the NYAY initiative (Minimum Income Guarantee) has generated considerable debate. Given NYAY’s breathtaking scope, it is imperative that concerns about the programme are addressed. As widely reported, eminent economists from India and abroad were consulted to develop what Rahul Gandhi has called a “final assault on poverty”. NYAY aims to provide a direct cash transfer of Rs 6,000/month or Rs 72,000/year to 5 crore of India’s poorest families. At an average family size of 5, this translates to 25 crore people or 20% of India’s population. The money would preferably go to a bank account of a female member of the household. The current estimated cost of NYAY at Rs 3.6 lakh crore is about 1.8% of today’s GDP. By the time NYAY is fully rolled out, this cost is likely to drop well below 1.5% of GDP. Reacting to this game changing announcement, it is appropriate to ask about how Congress intends to pay for NYAY. Ironically enough, finance minister Arun Jaitley was at pains to assert his government was already providing much more to India’s poor. Of course, hypocritically, BJP has yet to credibly explain how it will fund the PM-Kisan Yojana, which may cost over Rs 75,000 crore annually. ... Third, though NYAY is clearly about social justice and economic empowerment, Congress party has taken fiscal impact into account while developing it. NYAY will be rolled out in phases. It will be designed in the first three months of the next government’s tenure followed by a pilot phase. After that NYAY will be launched in phases across the country. This should have two benefits – costs will initially be low and at its peak be below 1.5% of GDP before declining as a share of a growing economy. Additionally, NYAY will boost consumption demand among poorer sections and have a positive multiplier effect on the economy. A growing economy can boost job creation even as we take the fight to poverty. Of course, even if the costs are kept low, they must be paid for. It is here that both increasing revenue and rationalising expenditures are on the table. The Congress manifesto has committed to raise revenues through different mechanisms such as disinvestment from non-core and non-strategic central PSUs and rationalising expenditures by scaling back non-core central government schemes. Moreover, NYAY will be funded both by central and state government contributions. However, Congress party has made two decisions – core merit subsidies will not be touched and there will be no additional tax burden on the middle class.>> That's a striking contrast. As striking as it could be.] https://timesofindia.indiatimes.com/blogs/toi-edit-page/why-nyay-cant-wait-here-is-what-congress-will-do-to-mount-a-final-assault-on-poverty/ Why NYAY can’t wait: Here is what Congress will do to mount a final assault on poverty April 17, 2019, 2:00 AM IST M V Rajeev Gowda in TOI Edit Page | Edit Page, India, politics | TOI By Rajeev Gowda and Salman Anees Soz Congress president Rahul Gandhi’s announcement of the NYAY initiative (Minimum Income Guarantee) has generated considerable debate. Given NYAY’s breathtaking scope, it is imperative that concerns about the programme are addressed. As widely reported, eminent economists from India and abroad were consulted to develop what Rahul Gandhi has called a “final assault on poverty”. NYAY aims to provide a direct cash transfer of Rs 6,000/month or Rs 72,000/year to 5 crore of India’s poorest families. At an average family size of 5, this translates to 25 crore people or 20% of India’s population. The money would preferably go to a bank account of a female member of the household. The current estimated cost of NYAY at Rs 3.6 lakh crore is about 1.8% of today’s GDP. By the time NYAY is fully rolled out, this cost is likely to drop well below 1.5% of GDP. Reacting to this game changing announcement, it is appropriate to ask about how Congress intends to pay for NYAY. Ironically enough, finance minister Arun Jaitley was at pains to assert his government was already providing much more to India’s poor. Of course, hypocritically, BJP has yet to credibly explain how it will fund the PM-Kisan Yojana, which may cost over Rs 75,000 crore annually. Illustration: Uday Deb Three main concerns have been raised about NYAY. First, wouldn’t direct cash transfers adversely affect workers’ incentive to work and increase consumption of ‘sin’ goods? Second, how will it be implemented and how will beneficiaries be targeted? Third, won’t the scope of this scheme bust the budget? Finally, some may be wondering why we should even do this in the first place. Minimum income guarantee is not a new concept, and cash transfers have increasingly become a mainstream means of social protection in many countries, both developed and developing. The experiences of these countries can help us adapt cash transfers to the Indian context as well as respond to some of the concerns. First, evidence shows that poor people do not stop working if they receive cash assistance from governments. A study conducted by Harvard and MIT economists in seven countries titled “Debunking the Stereotype of the Lazy Welfare Recipient: Evidence from Cash Transfer Programs Worldwide” found no evidence that cash transfer programmes discourage work. Sewa and Unicef assessed the results of a pilot cash transfer programme in Madhya Pradesh and found that consumption of demerit goods did not increase due to cash transfers. This is supported by similar findings in World Bank’s review of 19 cash transfer studies. The second concern about beneficiary identification and implementation is important but not insurmountable. There are many datasets available from government and independent research to help identify beneficiaries. Also, NYAY would not be the first targeted scheme operating in India. Ujjwala, Kisan Samman and Ayushman Bharat, are all targeted programmes. With advancing technology and big data, implementation of government schemes can improve. We must also be careful not to make perfection the enemy of the good. Eminent economists, including late TN Srinivasan, Pranab Bardhan and Debraj Ray have supported some form of income grants. Arvind Subramanian has recently lent his support to quasi-universal basic income. These experts do consider implementation challenges. Clearly, if this government can target 50 crore people for the Ayushman Bharat scheme, targeting half of that should be readily doable. Third, though NYAY is clearly about social justice and economic empowerment, Congress party has taken fiscal impact into account while developing it. NYAY will be rolled out in phases. It will be designed in the first three months of the next government’s tenure followed by a pilot phase. After that NYAY will be launched in phases across the country. This should have two benefits – costs will initially be low and at its peak be below 1.5% of GDP before declining as a share of a growing economy. Additionally, NYAY will boost consumption demand among poorer sections and have a positive multiplier effect on the economy. A growing economy can boost job creation even as we take the fight to poverty. Of course, even if the costs are kept low, they must be paid for. It is here that both increasing revenue and rationalising expenditures are on the table. The Congress manifesto has committed to raise revenues through different mechanisms such as disinvestment from non-core and non-strategic central PSUs and rationalising expenditures by scaling back non-core central government schemes. Moreover, NYAY will be funded both by central and state government contributions. However, Congress party has made two decisions – core merit subsidies will not be touched and there will be no additional tax burden on the middle class. Finally, let’s consider other facts that make NYAY a necessity. A 2016 report by the Asian Development Bank ranked India 24th out of 35 Asian countries in terms of spending on social protection as a share of its economy. Rising inequality, with lack of employment opportunities, a destructive demonetisation and an ineptly implemented complex GST have added to the woes of the poor. This is morally unacceptable. Callous naysayers will attack NYAY and call the Congress’s efforts “dole-nomics” or “povertarianism”. Had we listened to naysayers in 2004, MGNREGA would not have happened. We would not have been able to lift 14 crore Indians out of poverty, partly through MGNREGA. Our perseverance paid off and led to the World Bank calling MGNREGA “a stellar example of rural development”. The time for social and economic justice is now. Ab NYAY hoga! Rajeev Gowda is Chairman of Congress’s Research Department. Salman Soz is a Coordinator of the All India Professionals’ Congress -- Peace Is Doable -- You received this message because you are subscribed to the Google Groups "Green Youth Movement" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. To post to this group, send an email to [email protected]. Visit this group at https://groups.google.com/group/greenyouth. For more options, visit https://groups.google.com/d/optout.
