The Union Budget clearly affirms the government's commitment to a market-based economy, with high economic growth. The hope is that a rising tide will lift all boats. But until that tide actually comes in, the boats need some alternative other than waiting.
There is much less than hoped for in the Budget when it comes to the social sector.
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For example, there were no significant announcements for the health sector, on which India's Budget spends have historically been abysmally low.
The good news is that none of the existing social sector schemes have been rolled back. Without going into details, the finance minister also spoke of a universal social security cover. This is very welcome. Having exactly such a safety net will give the government the public trust to move forward on some bold ideas that it wants to implement.
An additional allocation of Rs 5,000 crore has been announced for Mahatma Gandhi National Rural Employment Gurantee Scheme (MNREGS). Clearly, some one in the government believes that much more has been achieved than just digging holes in the ground and that it is a scheme worth continuing for the impact it has had on the ultra poor, and for the many public assets it has built over the years.
The government's ambitious Swachh Bharat Mission (SBM) gets a further boost in this Budget with a two per cent cess that is to be levied on select services. There is also 100 per cent tax exemption on contributions to the Swachh Bharat Kosh. The focus on sanitation is welcome; it is clearly a confluence of public demand and political will backed by public finance. We must leverage this opportunity to the hilt. However, the focus seems to be on toilets alone, though it is quite clear that access to toilets by itself will not achieve the public health outcomes that we need. There has to be financial commitment to managing human waste safely and efficiently, and to return its nutrition to the soil or convert it to energy. There is an urgent need to outline exactly how government intends to achieve this with the SBM funds. Unfortunately, there was very little mention of urban sanitation. In an urbanizing India, where 80 per cent of sewage goes untreated, this problem will haunt us for generations if we do not begin to address it now.
Meanwhile, we still have to ensure that 100 million toilets are built and used. The finance minister assured the nation that 60 million toilets would be constructed in the next five years, but this past year does not give enough evidence of that pace. Government will have to streamline its subsidy-driven programme considerably to meet its target.
The education cess, through which the SarvaShikshaAbhiyan budgets were largely met, has been merged with the general pool. Much remains to be done in the primary and secondary education space, especially when it comes to learning outcomes. The finance minister spoke of this, but we do not know exactly how the government hopes to achieve it.
Perhaps, with more significant devolution to the states, we should be looking towards state budgets rather than the Centre, to understand how social sector spends will be imagined and executed.
The 'what' has now become obvious. The attention must quickly shift to the 'how'.