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Social sector allocation in budget down from 34 to 21%, 'injustice' to minorities, children

By Bharat Dogra* 

An important aspect of fiscal policy relates to the extent to which the various welfare needs of people are being met. One important indicator of this are the allocations made for the social sector.
The social sector in the context of the union government of India is generally identified in terms of the following ministries -- Agriculture and Farmers’ Welfare, Rural Development, Jal Shakti, Health and Family Welfare ( including Ayush), Education, Labour and Employment, Minority Affairs, Social Justice and Empowerment, Tribal Affairs, Housing and Urban Affairs, Women and Child Development, Youth Affairs and Sports, Environment and Climate Change, Consumer Affairs, Food and Public Distribution (including food subsidy) and, finally, Culture.
If we add the allocation of these ministries we get the allocation for the social sector, broadly speaking. On this basis, we can find out the percentage share of the total budget going to the social sector.
The Centre for Budget and Governance Accountability (CBGA) has carried out such an exercise in its recently published analysis of the union budget 2023-24 -- presented by Finance Minister Nirmala Sitharaman in Parliament -- titled "Walking the Tightrope". This analysis has found that there is overall a declining trend in the prioritization of the social sector.
During financial year 2019-20 (pre-COVID) the allocation for the social sector in the total budget was at a modest 23.5% (in terms of actual expenditure). Next year, due largely to the special COVID packages, this rose to 33.5%. Next year, this declined to 26.9%. For the year 2022-23, the actual expenditure is not yet available. However, if we look at the Budget Estimate this declined to 23.5% and if we look at the Revised Estimate the decline was to 24%. In the budget allocation announced for 2023-24 ( Budget Estimate), the decline has gone further than at any other time in the last 4 years to 21.2%.
One way of summarizing this would be to say that from the high of 33.5% in terms of the actual expenditure recorded in 2020-21, the share of social sector in total union government budget has slumped to 21.2% in 2023-24 budget estimate. Another way to summarize would be to say that there is a clear declining trend during the recent times.
This is certainly a worrying trend as there is a clear need for giving higher priority to the social sector to make up for the acute distress, indebtedness and erosion of livelihoods suffered by people during COVID times. In fact if we just compare the 2023-24 allocations with the allocations during the pre-COVID year 2019-20, then also there is a significant decline in the share of the social sector in the union budget from 23.5% in 2019-20 to 21.2% in 2023-24.
As efforts to significantly increase the progressivity of fiscal policy by taxing the richest sections and billionaires to a much higher extent are in any case not being made, the budget size and overall expenditure can increase only to a limited extent. In such a situation, when even the prioritization of the social sector decreases, then there are reasons for serious worry relating to non-availability of funds for important tasks and challenges in the social sector. This trend should be checked, and instead there should be increasing prioritization of social sector in the budget.

Injustice to minorities

At a time when minority communities have been passing through difficult times and need reassurance and support, the union budget has come as a rude jolt for them with its big cuts in allocations for such obvious priorities as education and skills. What is more, as the now available data shows, there were very big cuts in the previous year 2022-23.
These cuts in the previous year as well as huge disruptions faced by informal sector workers and small-scale entrepreneurs due to pandemic related factors had created conditions in which the Ministry of Minority Affairs needed a significant increase in its resources for the year 2023-24, but exactly the reverse has happened.
The original allocation for the Ministry of Minority Affairs (called Budget Estimate or BE) was INR 5020 crore in 2022-23, but this faced a very severe cut to INR 2612 crore when the Revised Estimate (RE) for this year was prepared, a very big cut indeed. In 2023-24 INR 3097 crore has been allocated, which is not only much less than the BE of the previous year, but in fact is even much less than the actual expenditure even of 2021-22, which was placed at INR 4323 crore.
The Umbrella Programme for Development of Minorities has been listed by the government as one of the ‘Core of the Core Schemes’, testifying to the importance of this programme. However this has not spared this programme from being cut heavily. INR 1810 was allocated in the BE for this in 2022-23, but at the time of preparing RE for this programme, this was cut by over two-thirds to just INR 530 crore, making a mockery of the original allocation. Imposing such a heavy cut without any extensive parliamentary or public consultation in a ‘core of the core’ scheme raises serious questions about budgetary ethics and transparency.
Ministry of Minority Affairs allocation was INR 5020 crore in 2022-23, but in 2023-24 it is don to INR 3097 crore
What are supposed to be obvious priorities such as education and skill development have also not been spared at the time of making cuts. In the context of central sector schemes, the allocation for ‘education empowerment’ of minorities was cut from INR 2515 crore to INR 1584 crore during 2022-23 (change from BE to RR) . The allocation for 2023-24 for this is INR is 1689 crore which is less than even the actual expenditure for 2021-22, placed at INR 2249 crore.
The allocation for ‘Skill Development and Livelihoods’ of minorities faced a cut from INR 491 crore in the BE of 2022-23 to RE of INR 330 crore. This has been further cut to an alarming extent in 2023-24 to INR 64 crore. This is less than one one-seventh of the actual expenditure of INR 499 crore in 2021-22 (and here we are not even including the inflationary aspects).
In the context of ‘Special Programmes of Minorities’, there was a cut from BE of INR 53 crore to INR 32 crore in 2022-23. This has been cut further to INR 26 crore in 2023-24.
The only saving grace in 2023-24 appears to be the allocation of INR 540 crore for PM-Virasat ka Samvardhan (PM Vikas). It will be interesting to see how this fund is spent. However this cannot make up for the big cuts in crucial issues like education and skill development.
Clearly various cuts in matters of critical importance for minorities are highly regrettable and the government should already start thinking in terms of upward revision of these allocations.

Children not receiving fair, adequate share

Child development is increasingly seen as the most important part of the development path. This is particularly true of a country like India where nearly a third of the children under 5 years of age are either stunted or underweight ( as per National Family Health Survey ) , or where nearly 32 million children are unable to complete school education. The urgency of prioritizing child development has increased all the more in recent times as a result of the distress and adversity suffered by children due to the special situation created by the pandemic and related lockdowns in which normal education and health needs could not be met, and a further drop of already low learning outcomes from schools was being widely reported.
In such a situation it is disturbing to know that child development is not receiving the desired priority, even in terms of the rather low norms set by the government. According to the National Plan of Action for Children, 2016, at least 5% share of the budget should be allocated for children. However in 2023-24 Union Budget only less than half of this, 2.3% to be more precise, has been allocated.
What is more, as the CBGA) has pointed out in its budget analysis titled ‘Walking the Tightrope’, this share has exhibited a declining trend in recent times. This share, in terms of actual expenditure, was 3% of the union budget in 2019-20 and reached its lowest level of just 1.9% in 2021-22.
Many child specific programmes have suffered from low and stagnating budgets, made worse by cuts made at the time of preparing revised estimates.
In the case of school education, the most important programme of Samagra Shiksha Abhiyan suffered a cut of nearly INR 5200 crore ( one crore=10 million) when the revised estimates for last year 2022-23 were prepared. In the case of the mid-day meals programme, while its name was changed to the heavier sounding Pradhan Mantri Poshan Shakti Nirman, the budget this year is less than the revised estimate of the previous year. For this programme as well as for anganwadis, important reforms have been announced but this is not seen in matching increases in budgets for these programmes, which are stagnating , more or less, and once the impact of inflation is taken into account, there is even some decline in real terms.
The need for increasing allocations for child protection has increased as amidst the increasing deprivation caused by COVID and related lockdowns, incidence of child trafficking and child labour is likely to have increased. Despite this, the allocations for programmes of child protection have faced cuts.
The National Plan of Action for Children sought 5% share of budget, but in the 2023-24 Union Budget it was only 2.3%
Mission Vaatsalya is a programme that combines several child protection and welfare services. The allocation for this scheme this year (2023-24) has remained the same as the previous year, so that after accounting for inflation there is a reduction in real terms. What is more, during the last financial year 2022-23, there was a big reduction of INR 372 crore in this programme from the original allocation of INR 1472 crore to INR 1100 crore.
In the case of the National Child Labour Project the allocation last year was already very low at INR 30 crore, and this year this has been reduced further to INR 20 crore. As INR 77 crore was spent on this project in 2019-20, a clear decreasing trend can be seen. Isn’t reducing child labour a priority for the government? If it is, why is the already low budget being reduced further?
A further dilution of child labour related core work is likely to be caused by the merging of the National Child Labour Project (with its emphasis on identifying hazardous areas of work and removing child workers from there) in the Samagra Shiksha Abhiyan (where the focus is on ensuring that children who are out of school can join school).
Even at the present limited size of the union budget (which is constrained by its inability to tax the richest sections adequately), nearly INR 110,000 crore extra funds can become available for the better health, nutrition, education, welfare and protection of children if the rather conservative norm of allocating at least 5% of the total budget for child related programmes, as recommended in the National Child Action Plan, is followed. Clearly the government is in a position to allocate much more for meeting essential needs of children, even in terms of its own norms, but has failed to do so.
*Honorary convener, Campaign to Save Earth Now. His recent books include ‘Protecting Earth for Children', ‘A Day in 2071’ and ‘Man over Machine'



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