It is the same old story again
Source: By Madan Sabnavis: The Financial Express
The Human Development Report is a useful document as it puts on a relative scale the level of progress made by various countries on social parameters. It is quite agnostic to the policies or levels of incomes of a country and poses an objective question on various indicators. As is normally the case with India, we continue to fare quite low on the scale with a rank of 135 out of a set of 187 countries, which has not changed for some time. We are grouped under the medium human development category and are better than countries like Bhutan and Bangladesh but lower in the pecking order than countries like Ukraine and Vietnam. Within the group of BRICS, the rank is quite embarrassing with Russia (57), Brazil (79), China (91) and South Africa (118) faring better. In the SAARC group, India is much lower than Maldives and Sri Lanka.
The Human Development Index evaluates progress on a combined scale which looks at education, life expectancy, income, inequality and other parameters like trust, poverty, etc. India’s relative position has not quite changed over the years. This is notwithstanding all the noise that is made by the government on spending on welfare schemes and talking a lot on social development. Subsidies, employment programmes, rural health and welfare, women empowerment, etc, are regularly spoken about in successive Budget documents with various allocations being made at both the central and state levels. The tempting conclusion is that we may be having a combination of the allocations being inadequate; and the money not being spent in the right manner with leakages in the system. This means most of the schemes we have listed in the Budgets are not delivering well at the end of the day. Hence, the case of schools without teachers or hospitals without beds is reflective of the half-hearted attempts made to deliver public services.
On the positive side, the human development score has improved over the years from a low of 0.369 in 1980 to 0.431 in 1990 to 0.483 in 2000. It has climbed to 0.586 in 2013. But the fact that our rank has remained static in the last 5 years or so means that other countries have also been making similar strides in improving the lot of their people, which keeps us where we are on the relative scale. With our size of population and GDP, the effort has to be greater to bring about any perceptible change in the relative scale.
Some numbers are quite distressing. On the parameter of multi-dimensional poverty criteria, the UNDP has a count of 631 million, which means that when we broad-base the definition of poverty, around half of the people are out of the development process. China had only 80 million in this category. This is less flattering than the Rangarajan report on poverty which puts the ratio at closer to 30%.
The mean school years for Indian children is just 4.4 years (China: 6.9 years), which rebuts this whole concept of demographic dividend that we talk of. When we have a large number of children maturing into adults without the requisite education, job procurement becomes a challenge, which can result in increasing inequality that has social repercussions. Further, only 50% of males and around 34% of females have had access to secondary education.
The report also has some indicators such as trust, which are based on surveys on how citizens view their government. In India, it was found that 54% of the people trust the government while only 39% think the government is doing right when it is dealing with the poor. These ratios are quite low in the global context, though trust in government is also low for some developed countries with the US having 35%. The overall level of satisfaction is 4.6 on a scale of 10 with the developed countries having scores of above 7.
A curious observation on overall dependency, which includes both children (0-14 years) and the elderly, is that as one moves down the scale from very high human development to high, medium and low levels, the proportion of children increases. The rich countries have an even share of elderly and children, while this ratio declines (elderly to children) as the level of development decreases. Therefore, the proportion of pensioners is high. But those in the higher category are able to convert them to beneficiaries in a better manner than the countries with low human development.
Two points stand out here. The first is that the high economic growth we have witnessed in the last decade has been skewed and efforts at reforms and policy changes have been geared more towards making the productive sectors more efficient. Second, the government’s delivery of services has been both insufficient and inefficient as most of these indicators are in the realm of social welfare, where the government has to play a leading role as it is not profit earning for the private sector to take up. Even where the private sector does enter, the services cater to the elitist groups in areas of education and health, which probably just scratches the periphery of the uppermost income group.
Low human development levels are just not sustainable as these indicators are pre-requisites for building a sound society. Social infrastructure has to evolve and move to higher levels to sustain economic growth in a broad-based manner. A way out is to outsource social infrastructure growth to the private sector, which can ensure better delivery. Just the way there are PPPs in physical infrastructure, the private sector should be made partners in this exercise so that the results get better.
There is evidently a need to revisit our models for delivery of social services and the current practice of funds moving from the Centre through the states to the local bodies for implementation is fraught with several challenges. The private sector has proved to make a difference when it has taken up causes under the ambit of corporate social responsibility. These have been mere specks in the ocean and have to be scaled up. The government must experiment by allocating some funds to be contracted to private parties with set delivery standards. Pilot projects in education, health and sanitation should be taken up and, if successful, could be proliferated across various geographies. Clearly, new models must be tried out which could just work.
The Human Development Report is a useful document as it puts on a relative scale the level of progress made by various countries on social parameters. It is quite agnostic to the policies or levels of incomes of a country and poses an objective question on various indicators. As is normally the case with India, we continue to fare quite low on the scale with a rank of 135 out of a set of 187 countries, which has not changed for some time. We are grouped under the medium human development category and are better than countries like Bhutan and Bangladesh but lower in the pecking order than countries like Ukraine and Vietnam. Within the group of BRICS, the rank is quite embarrassing with Russia (57), Brazil (79), China (91) and South Africa (118) faring better. In the SAARC group, India is much lower than Maldives and Sri Lanka.
The Human Development Index evaluates progress on a combined scale which looks at education, life expectancy, income, inequality and other parameters like trust, poverty, etc. India’s relative position has not quite changed over the years. This is notwithstanding all the noise that is made by the government on spending on welfare schemes and talking a lot on social development. Subsidies, employment programmes, rural health and welfare, women empowerment, etc, are regularly spoken about in successive Budget documents with various allocations being made at both the central and state levels. The tempting conclusion is that we may be having a combination of the allocations being inadequate; and the money not being spent in the right manner with leakages in the system. This means most of the schemes we have listed in the Budgets are not delivering well at the end of the day. Hence, the case of schools without teachers or hospitals without beds is reflective of the half-hearted attempts made to deliver public services.
On the positive side, the human development score has improved over the years from a low of 0.369 in 1980 to 0.431 in 1990 to 0.483 in 2000. It has climbed to 0.586 in 2013. But the fact that our rank has remained static in the last 5 years or so means that other countries have also been making similar strides in improving the lot of their people, which keeps us where we are on the relative scale. With our size of population and GDP, the effort has to be greater to bring about any perceptible change in the relative scale.
Some numbers are quite distressing. On the parameter of multi-dimensional poverty criteria, the UNDP has a count of 631 million, which means that when we broad-base the definition of poverty, around half of the people are out of the development process. China had only 80 million in this category. This is less flattering than the Rangarajan report on poverty which puts the ratio at closer to 30%.
The mean school years for Indian children is just 4.4 years (China: 6.9 years), which rebuts this whole concept of demographic dividend that we talk of. When we have a large number of children maturing into adults without the requisite education, job procurement becomes a challenge, which can result in increasing inequality that has social repercussions. Further, only 50% of males and around 34% of females have had access to secondary education.
The report also has some indicators such as trust, which are based on surveys on how citizens view their government. In India, it was found that 54% of the people trust the government while only 39% think the government is doing right when it is dealing with the poor. These ratios are quite low in the global context, though trust in government is also low for some developed countries with the US having 35%. The overall level of satisfaction is 4.6 on a scale of 10 with the developed countries having scores of above 7.
A curious observation on overall dependency, which includes both children (0-14 years) and the elderly, is that as one moves down the scale from very high human development to high, medium and low levels, the proportion of children increases. The rich countries have an even share of elderly and children, while this ratio declines (elderly to children) as the level of development decreases. Therefore, the proportion of pensioners is high. But those in the higher category are able to convert them to beneficiaries in a better manner than the countries with low human development.
Two points stand out here. The first is that the high economic growth we have witnessed in the last decade has been skewed and efforts at reforms and policy changes have been geared more towards making the productive sectors more efficient. Second, the government’s delivery of services has been both insufficient and inefficient as most of these indicators are in the realm of social welfare, where the government has to play a leading role as it is not profit earning for the private sector to take up. Even where the private sector does enter, the services cater to the elitist groups in areas of education and health, which probably just scratches the periphery of the uppermost income group.
Low human development levels are just not sustainable as these indicators are pre-requisites for building a sound society. Social infrastructure has to evolve and move to higher levels to sustain economic growth in a broad-based manner. A way out is to outsource social infrastructure growth to the private sector, which can ensure better delivery. Just the way there are PPPs in physical infrastructure, the private sector should be made partners in this exercise so that the results get better.
There is evidently a need to revisit our models for delivery of social services and the current practice of funds moving from the Centre through the states to the local bodies for implementation is fraught with several challenges. The private sector has proved to make a difference when it has taken up causes under the ambit of corporate social responsibility. These have been mere specks in the ocean and have to be scaled up. The government must experiment by allocating some funds to be contracted to private parties with set delivery standards. Pilot projects in education, health and sanitation should be taken up and, if successful, could be proliferated across various geographies. Clearly, new models must be tried out which could just work.
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