UF's Basic Minimum Needs Programme
Novelty or Niggardliness?


Recently, with tall claims of taing `radical steps' towards enhancing social sector spending, the UF government has sought to bring up the question of basic minimum services (BMS) in a big way. The Common Minimum Programme (CMP) has set targets to provide entire population with the 7 services under the Minimum Needs Programme. These are providing essential goods under the public distribution system (PDS), housing, primary health services, universalisation of primary education, rural link roads, mid-day meal scheme, nutritional support to children and women of poor households and safe drinking water. This was followed by a Chief Ministers' Conference on BMS and later a conference of state food ministers on PDS. In his budget too, Chidambaram made it a point to project an increased allocation of Rs.2,466 crores for the BMS programme as the main attraction of his finance bill. The first pronouncement by Madhu Dandavate, as soon as he took charge as the Deputy Chairman of the Planning Commission, was that the Ninth Plan's main thrust would be BMS. Indeed, the new government appears to be focusing a lot of attention on BMS. But far from being a radical step, it is only a smokescreen for government's contracting role in the social sector, for a World Bank-inspired rollback of welfarism in the name of 'proper focusing'.

For Marxists, any welfare measure, whether marginal or substantial, by the ruling classes is aimed at maintaining their class rule, to broaden their social base. The extent of this welfarism is directly proportional to the rise of revolution or the revolt of the oppressed. Similarly, with every major crisis of the economic system of the ruling classes and every significant rightward turn in the polity, it is welfarism which takes a major beating and gets rolled back. Confronted with Naxalbari, Indira Gandhi gave the famous call for Garibi Hatao. This call convinced nobody after about a decade, least of all the garib. Later her son argued that every unemployed youth is a potential revolutionary human bomb and came up with the slogan of Bekari Hatao. Both poverty alleviation and employment generation are now passe. 'Basic Minimum Services' is the in-thing. This signifies that more than two decades of liberals' labour is lost. In the 70s, the best of philistines among economists were busy in a brawl among themselves with their respective inch tapes as to how best to measure poverty and in what manner to alleviate it. After the proven bankruptcy of these measures, in the 80s, the emphasis was on employment schemes which they discovered were better anti-poverty measures. But they didn't click as populist measures or didn't help arrest the collapse of Congress.

Liberalisation had a two-fold impact on Indian welfarism. Both the fiscal compulsions and the neo-liberal ideological offensive chipped away at the existing welfare regime. But, realising the political fallout, World Bank wanted some kind of social 'safety net' put in place. Now the UF is coming up with this new ambitious slogan of BMS. Apparently, it is a massive hold-all populism: with NTR's 2 Rs. a Kg. rice scheme, MGR's noon meal scheme, Naseer Sab's drinking water schemes or the educational promotion experience of Kerala and many other such schemes rolled into a single package. Though it is said that the next Plan would be based on BMS, the package has no fresh meat to it. Only the liberals inclined towards UF have been taken in by this concept of basic minimum needs, now coined anew as a market-friendly substitute, basic minimum services. In their opinion, BMS is supposed to be more pro-people, closer to their needs and more in line with federalism. Some would even interpret it as a fullfledged social democratic charter of a Centre-Left coalition despite the fact that UF and its CMP reduces every social right to either a mere legal right or just reservation or welfare scheme and negates even the right to welfare while paying lip service to fulfilling basic needs. Basic needs sans basic rights - this is the basic limitation of UF brand of liberalism even in theory. To get a more concrete idea let us take a detailed look at these seven areas and the World Bank prescriptions regarding these.

CMP and Budgetary Allocations

The seriousness shown by the government towards fulfilling these targets is only skin deep. The enhanced budgetary outlay of Rs.2466 crore is 11% over the Rs.18,726 crore allocated for these schemes in the interim budget presented earlier in the year by Manmohan Singh. This 11% increase, after accounting for inflation, is not substantial as claimed by Chidambaram and the final amount of Rs.21,220 crore is peanuts compared to the actual financial requirements of these sectors per year even by the governmental estimates. Given the significant rate at which the main targeted 'beneficiary' group, the rural poor, is growing due to pauperisation, specially during the liberalisation era, the UF's so-called special concern is rendered even more inane in the face of ever increasing actual needs. This is apart from the disproportionate distribution compared to the actual needs of each of these services in various states, the low utilization and unavailability of these services to the targeted groups in the countryside given the inequitable social structure, the gross inefficiency and delay in implementation, bungling of funds and a host of other problems which are quite well known.

The Conference of Chief Ministers further decided on transferring the centrally-sponsored schemes in these seven areas - a decision observed by Chidambaram more in breach - through the State governments to the local implementing bodies and on giving more leeway to the States to decide on setting priority areas among the seven services and distribution of funds to the local agencies. This might seem congruous with the federalism-fetish that has bugged the admirers of UF government but there is no gainsaying the fact that corruption, diversion and leakage of funds and bureaucratism is more at these lower levels. The UF, with fodder scams to its credit, has no simultaneous programme to tackle these problems. Secondly, no long-term fiscal policy commitment on BMS was forthcoming from UF. Let us see the requirement and the allocations in specific areas.


Of all the seven areas PDS is the political minefield. But the dominant discourse about PDS is to trim it and not increasing the subsidy. The GATT and World Bank conditionalities must be having a decisive influence on the prevailing general thrust in this vital area. The most 'populist' of the PDS schemes which was in operation in Andhra has been recently scuttled, mainly due to World Bank's insistence. The Chief Ministers' Conference and the budget talk about streamlining PDS by stabilising prices and targeting only the families below the poverty line and about achieving these objectives completely by the year 2000. Apart from this there is the mention of a marginal hike in food subsidy.

As has been seen, the issue price of food grains from PDS has been almost doubled over a short period of 4 years in the initial liberalisation years (which today stands close to market prices) to contain the food subsidy. According to noted economist C.H.Hanumantha Rao this has additionally resulted in a steep increase in the CPI for agricultural labourers in this period of slow growth in output and employment leading to an erosion in the real income of rural poor which in the case of skilled labourers too a negative rate of rise. The hike in issue price is more than what is required to compensate for the concurrent increase in procurement prices benefiting mainly the medium and rich farmers.

Past experiences in implementing PDS have shown that in large number of States the benefits have hardly percolated down to those below the socalled poverty level. One, but for Gujarat and the southern states, the incomplete coverage of the PDS in most parts of the country leaves out an important part of the population. While there is appropriate coverage in the metropolitan cities, it is less complete in the smaller towns and almost absent in the villages. An estimate shows that (Table 1) for about 27% of the villages, the nearest PDS is beyond a range of 5 km. rendering them in most of the cases inaccessible. This is compounded with the problem of frequent inadequate supply which worsens as one moves from the metropolitan cities to the villages. In most of the states, mainly in the North, the distribution is with the private sector where diverting supplies to the open market and retailing inferior quality or adulterated supplies have been a common phenomenon.

Two, in another sense, the PDS is incomplete because it only partially caters to the quota of commodities in the minimum food basket and other non-edible items that the government commits to provide. Some of the articles other than coarse foodgrains like clothing, cooking oil etc. have virtually vanished from the distribution outlets. The section of the poor who do avail of the PDS benefits, mainly the urban poor, are left to procure these items from the open market. Interestingly, one of the major constituents of the UF, the Janata Dal, in its election manifesto promised 'to make available all such essential commodities' at highly subsidised rates and for this it favoured 'considerable increase in the subsidy to be made available in the budget'.

Three, from the point of view of implicit subsidy to the poor i.e. what the poor household saves by procuring definite quantities from the PDS, or as a measure of socalled 'income transfer' to those poor who use the PDS (for the objective of poverty alleviation), the venture has failed to benefit such a section either due to high percentage of this section being left out of the PDS net or low 'income' accrual from small PDS-open market price differentials.

Instead of reaching out to those who need access to subsidised foodgrains, the 'targeting' proposes keeping out those who 'can afford market prices' and this is being pushed as the major objective behind the restructuring of PDS. Which effectively means shedding-off a major part of the 'burden' of state subsidy. Even by conservative estimates (undertaken by a team from IGIDR, Bombay for 1993 prices), if at all just those below the poverty level are to have access to subsidised cereals for all or most of their nutritional needs, then the additional amount of foodgrains to be distributed will be at a minimum 19.80 million tonnes which in financial terms requires an additional outlay of Rs.3,580 crores while the total offtake from the PDS in 1993-94 was only 15 million tonnes and the food subsidy Rs.5,300 crore and this year's budgetary outlay is only Rs.5,884 crore! A considerable erosion in real terms! And here you get the real meaning of restructuring the welfare spending and refocusing it on BMS!


Roof for all by the year 2005 - public housing to all shelterless poor families by 2005. This is the target set by the government. An additional Rs.250 crore has been earmarked by the budget for providing shelter including basic amenities for slum dwellers. This stands against a projected backlog of 7.57 million housing units (including an excess of households over housing stock, the houseless population, the kutcha unservicable stock as well as the congestion and overcrowding of families) by next year. With the housing needs rising every year, an estimated total of 16.76 million shelter units for different income groups would be required by the end of the Ninth Plan.

One can very well see the paltry sums thrown in to show the government's great commitment towards this goal. At this rate of allocation not even 1% of the backlog can be cleared. The story has been the same since the Fifth Plan and the subsequent ones under the Minimum Needs Programme - chasing illusory targets with insufficient funds and inefficient implementation. Reducing a gargantuan problem with important social and cultural dimensions to a mere welfare propaganda, the essential point about housing is neatly avoided. Housing is a basic right for all - a point that the government steers clear off by reducing it down to yet another social welfare scheme existing largely on paper. The state does not recognise housing as a fundamental right and no overriding law exists which seeks to regulate and implement the policy of adequate housing.

The Chief Ministers' Conference and the CMP make no mention about housing right as a social right. Mere government public construction projects or credit policies are insufficient even to tinker with the rate of growth of backlog. For instance, the common problem of slum-dwellers is arbitrary eviction by a mafia-police-corrupt development authority nexus. Providing amenities or housing credit policies hold nothing without arming the slum-dwellers with the right for acquisition of their lands by and regularisation of their land for squatters which will provide necessary legal protection against evictions and forcible relocations. There is no mention in the Conference of loosening up the rigid official procedures in providing credits for building houses or availing public housing benefits. There are no housing schemes for workers and other occupational categories.

Primary Health Service

The liberals and NGOs had long been attacking the health care delivery system in India saying that it is biased in favour of urban population and against primary health sector. Little did they realise that the World Bank too would borrow their language and steal their arguments on health priorities to force the government to withdraw from secondary and tertiary sectors. 'At present the resources are being spread far too thin', said the WDR 1993 and the Union Government decided to divert 50% of the resources from tertiary sector hospitals to primary health sector leaving large areas of health care to private sector.

The goal for providing health for all has been an elusive one judging by the number of times targets have been set by various governments in the past. Deve Gowda has promised to cover a population of 5000 under one Primary Health Centre (PHC) by the turn of this century. The per capita expenditure on health has been decelerating in general, and in the budgets of the states in particular. The public share in the total health expenditure has been declining sharply and this is even more serious given the disease profile and poor fitness levels in the country. Yet we have misleading success stories of a decreasing population per PHC and number of patients-per-bed ratios since the coverage of PHCs and their sub-centres have been lop-sided with large sections of the rural areas being left out of their purview. In terms of accessibility it is estimated that (Table 1) about 52% of the rural villages have the nearest PHC or a sub-centre beyond a distance of 5 km. from the village, and for the same distance range for the nearest dispensary there are about 60% villages, for the nearest hospital there are about 80% villages and for the nearest maternity centre there are about 45% villages.

Accessibility apart, the PHC system is far short of providing quality medical service. The private clinics in the countryside catering mainly to the kulaks and rural rich are mushrooming over the crumbling edifice of local district hospitals. In states like Haryana and Punjab, even small villages have come up with air-conditioned private clinics where premium personalised service is provided for and this has opened up a booming business for doctors who it seems, contrary to trends in the past, are heading for the villages. Apart from suffocating the hospitals for paucity of funds, as a cost recovery mechanism user charges in public hospitals have been introduced.

Education and Mid-day Meal Scheme

It is here in education that the government's mischief of expanding the primary network at the cost of the secondary and tertiary sector is seen most clearly and also where it has played the most havoc. Chidambaram proudly - obviously since there are fewer opportunities to boast of social sector fund hikes - declared the increased allocation for the Department of Education from Rs.1,825 to Rs.3,388 crores but budget papers make it clear that not a penny more would be further invested in higher education which has a mere 7% of the share compared to 67% going to primary education. Bulk of this hike would be channeled for the District Primary Education Programme and the mid-day meal scheme. In fact, this 85% hike in education outlay has been made possible by recently negotiated World Bank aid package for funding the District Primary Education Programme which has been passed off as higher budgetary allocation.

The country did not have to wait for any Minimum Needs Programme for setting the target year for providing free and compulsory education to all children below the age of 14 as 1970, which was set right after independence. While successive governments have 'prided' in setting such illusory targets afresh once every few years - which don't even instill any sense of straightening up the educational mess, leave alone chasing targets - still about 26% villages are estimated to be without any school. The 47th NSS Round (for July-Dec.,1991) estimates that about 43.63% villages reported that no new school building has come up in the last five years i.e. 1986-91. The same survey reveals that about 32% villages have no pre-primary school within a range of 10 km. and for the same range for primary school there are about 9% villages and for middle schools there are about 15% villages (Table 1). As far back as 1973 the Fifth Plan had (belatedly) set the norm of establishing a primary school within 1.5 km of every village.

There is a high drop-out rate from the primary schools shown by the huge difference in enrollment figures between the age groups of 5-11 years and 11-14 years. In the former age group the rate is as high as 46.50% for boys and 50.35% for girls. Among the students from Scheduled Tribes it is as high as 66.66% This will remain a problem due to the extreme socio-economic hardships that many children have to face at quite an early age but it has been compounded further by a badly afflicted public education system. Even though over the years enrollment figures have shown a rise, there is hardly anything commendable about the situation of girl students. Certain inducements such as provision of text books and mid-day meals have been introduced. While the former has been unceremoniously grounded at many places, the latter has failed to take-off appreciably and in many cases it has hardly been a draw. By the time funds reach the grassroots level the funds already get thinned out due to a highly corrupt implementing machinery.

As a limited welfare measure primary education has two-fold effect. It extends an opportunity to create awareness among large sections of population which have been historically deprived of developmental benefits. But in the era of liberalisation it also nurtures a generation that would one day be the modern market's consumerate. This aspect of education namely functional literacy can be achieved through elementary inputs i.e. education till the primary level or the high-fanfare National Literacy Mission where a section of the adult population could also be roped in. It is with higher education and not just primary education that individuals from depressed social groups find opportunity for upward mobility or their communities get some awareness through such representatives and gather some cultural strength for political assertion.

So as it stands for the government, primary education is a welfare sop and market cultivation measure and higher education a burden. What the state has always denied and what this government is trying to divert attention away from is that right to education is a fundamental right. This demand had figured in most of the election manifestoes of the constituent parties of the UF. But the government has reduced down the question of education as a welfare badly in need of rationalisation.

Rural Roads

The rural link roads are an important requirement for the emerging kulaks and the industry seeking to reach out to them as a lucrative market. The Chief Ministers' Conference identified it as the thrust area to which States should accord highest priority. An elaborate and broadbased road network is an essential need for a modern market to expand, specially when the number of consumer-goods producing MNCs are rapidly increasing. And as Chidambaram says good roads are essential for maintaining 7% growth. For this an Infrastructure Development Finance Company (IDFC) has been set up which among other things would finance the construction of rural link roads. The state of rural roads and their construction, under the local authorities has been pathetic with about 38.22% villages reporting no construction of link roads in the past five years.(NSS, 1991) Without strengthening the existing infrastructure development mechanism, inviting private sector to develop roads on BOT basis and setting up financing company is nothing more than fiscal gimmick. As far back as 1961, the Third Plan had, for a target period of 20 years, promised that no village in a developed or agricultural area would remain more than four miles from a metaled road and more than 1.5 miles from any type of road. The 47th roundNSS rounds show that about 15% villages are more than 5 km away from a metaled road and about 4% villages are more than 2 km away from any sort of road.

But similar emphasis on trunk roads or the highways has been lacking in the budget. The National Highway Authority of India, compared to its increasing task for building more roads and highway development every year, has been provided a small sum for its capital base only, while for additional working capital it has been told to generate resources from the private sector in India and abroad. The indicative shift in policies related to road construction and maintenance shows that in the coming days a large number of trunk roads and highways would be handed over to the private sector for their maintenance and development, for example part of the Delhi-Jaipur highway has been given to a private company for maintenance and beautification in the name of tourism development. While rural roads can be handed over to the corrupt contractors emerging from kulaks.

Nutrition and Drinking Water

Nutrition for children and women of poor households have been undertaken under the ICDS scheme which are implemented through the aganwadis, balwadis and other nutritional and child feeding centres. The coverage of these centres has been inadequate with only about 52% villages being within a range of 5 km. from the nearest centre. (Table 1) The same survey estimates that about 28% villages have reported setting up of no aganwadi centre in the past 5 years.

The problem of drinking water has been compounded with the problem of slum-improvement in the urban areas. Previous plans though have dutifully made mention of the need for providing drinking water supply to certain categories of villages like those where the sources of water are endemic to water borne diseases or suffer from excess of salinity, iron or fluorides, yet disease profiles show that these areas still have recurring epidemics. Additionally the need for adequate quantity has also been a problem equally neglected.

Shifting Emphasis

The budget this year also brings to fore an important shift in emphasis from direct anti-poverty and employment generation schemes like IRDP, NREP, JRY etc. to BMS. Compared to a Rs.2,466 cr. hike for BMS, the budgetary outlay for rural employment and poverty alleviation is only Rs.4 cr. more than the revised estimate for 1995-96. In fact this figure is same as set by Manmohan Singh in his interim Budget. Even though a lot of noise was created over the BMS at the Chief Ministers' Conference, the budget has proved that no additional direct financial responsibility has been taken up by the government. The whole exercise has in a sense been a manipulation within the different expenditure heads for social sector, also overlapping with the infrastructure sector, just to show the government's greater emphasis on BMS.

World Bank-inspired

Here it is interesting to note what the World Bank has to say on this new welfarist gospel of UF. In one of its country papers on India, India: Poverty, Employment and Social Services (1990), the World Bank (WB) has made some observations on BMS and financing of these social services. Of course these are just observations but nonetheless it is interesting to find how the thoughts of the WB and our erstwhile opponents of the World Bank line of thinking vibe with each other.
For example, take its views on the education and health sectors. It says that for both these sectors, "More determined cost-recovery efforts, for example, by reducing higher education subsidies, would improve the social service resource pattern."

It makes an all too simplistic assumption regarding the growing acceptance of the private sector alternative in the health sector "...where large and uniform subsidies introduce numerous distortions. Extensive recourse to private medical practitioners points to a willingness and ability to pay across much of the income spectrum. NGOs have also demonstrated that clients will "accept" modest fees, especially if services are of higher quality." And since social sector spending would have to be `rationed', the Bank suggests to "...concentrate public provision of services on those that have large externalities and that non-government sector either can not or is not likely to provide, and to encourage private and NGO-run health and educational institutions to expand provisions of others."


The BMS thrust of the UF may not succeed in casting much illusions as some populist measures in the past. But by bringing these vital needs of the people under the purview of its propaganda it has opened up a Pandora's box. The exploding expectations of the people in these areas of basic needs can hardly be met by any of these governments, whether at the centre or at the States, especially under the present consensus regime of liberalisation. The World Bank, with its chic econometric models, may force the welfare restructuring on these governments but will not offer more than mere peanuts by way of hard cash. Not only Jyoti Basu and Nayanar but Manohar Joshi and Laloo also praise the BMS programme. The State-level political class may get little more money in the name of the basic needs of the people. But by politically surrendering to the UF, the CPI and CPI(M) have also given up any possibility of transforming popular aspirations on these needs into popular struggles and politicising them. Their participation in UF would deprive them even of the customary grassroots initiatives in these areas which have helped them achieve some degree of social democratic expansion in the past. Henceforth it is only our responsibility to unleash popular struggles on the basic needs of the masses and politically steer them against those treacherous forces who want to programmatically reduce them to the minimum at the instance of World Bank.