Reservations based on economic criteria: The right way to go as it is essential to retain some balance

  • Identification of such people is difficult as we do not have a system where income of a person is known for sure.

  • The system of records is already warped even when it comes to land.

  • Presently, it is difficult to exclude the higher income groups from LPG subsidy and even PDS.

  • This is also the right time to bring in reforms not just for this category of 10% but for all the covered people.

Affirmative action is always required in a country with inequality as it is the only way in which the distance is narrowed between different strata of society. The concept of reservations which came in India post-Independence had at its core this value.

It was decided to have it on the basis of caste; and over the time, there have been extensions to other categories too which has made it controversial. It has always been argued, and quite rightly too, that what mattered was not the ‘birth criteria’ but the ‘economic criteria’ and while it was true that to begin with the scheduled caste and scheduled tribe (SC and ST) categories were underprivileged, with time their status has changed for the higher echelons; and to bring parity the economic criteria made sense as it covered other communities too.

The Cabinet decision to bring in the 10 percent economic criteria reservation is definitely progressive in nature and will address the lacunae that exists in this system.

 Reservations based on economic criteria: The right way to go as it is essential to retain some balance

Representational image. PTI

The Cabinet decision now says that there will be a 10 percent reservation for government jobs and higher education institutions. This means that it is universal and applies to all religious and caste groups as well as gender. The important issue will of course be of identification of such people as we do not have a system where the income of a person is known for sure.

Presently, the ration card has an amount which is based on self-declaration which cannot be foolproof of the person actually earning less than the threshold amount. This will be the biggest challenge. Determining the income of any person is tough because often even the very poor may have some property in their home place which is hard to ascertain.

This will probably be the hurdle to identify the right set of people for this cause. The system of records is already warped even when it comes to land and hence to get the income is even more difficult. One can see that such a system will be open to gaming where individuals may pay bribes to get this attestation.

It would also be interesting to see what the threshold level of income would be as this is something which will be the starting point of the exercise. The poverty ratio in the country is still quite high and probably these criteria can be used for identifying those who would qualify for this benefit. The socio-economic census had identified an even larger number of people as being poor or deprived (65 percent in 2011).

With a plethora of people claiming to be economically challenged, the benchmark has to be well-determined and the process for screening should also be robust so that it eschews adverse selection. Presently, it is difficult to exclude the higher income groups from liquid petroleum gas (LPG) subsidy and even public distribution system (PDS) as the basis is self-declaration in the coloured ration card.

This would also be the time to review the system of reservation and there are two ideas that may be considered. The first is that such a facility should be provided only once in a life time and this means that if a child qualifies at the time of higher education, access to a job would be restricted.

There would hence be an incentive to perform or lose out in future. Presently, the situation is one where the affirmative action holds all through the life cycle of a person which gives a perverse incentive to not really improve. It is taken for granted in many cases that even promotions become automatic once in the government sector as the reservation tag helps once through. The idea of restricting the same to one time is also useful to cover a larger canvas of the deprived community.

A counter point here would be that since such reservation often at the stage of higher education would tend to be more in government institutions where the candidate’s quality of primary education could be lower there may not be much advantageous here. Also if it holds in all educational institutions, which is the case today, the students with reservation find it hard to cope with the curriculum and tend to drop off in advance.

This is a valid argument and this is where the second idea comes in. Along with the concept of reservation, there must be a policy where these candidates in both school/college as well as work place receive special training to ensure that the standard of competence improves over time. This should be the responsibility of the state or else the policy will degenerate into one where only targets are met for hiring or admitting candidates from the economically deprived groups.

Reservations ideally are not desirable in western developed societies where all people have access to the same facilities at the time of birth. However with high levels of deprivation which has come over years, it is essential to retain some balance. Doing it based on income is definitely the right way.

This is also the right time to bring in reforms not just for this category of 10 percent but for all the covered people that we work to improve the competence levels simultaneously so that they remain on par with others. Performance criteria is a must and these personnel should be compelled to meet them so that they improve over time and not take things for granted which is the case at times in the current dispensation.

It would be interesting to see how this is implemented because we would be talking of around 60 percent (if 10 percent is additional and not carved out from the existing set of reservations) or more of the jobs being reserved which can be daunting for those who are out of this circle. If skill sets imparted do not improve commensurately then the impact on quality will be seen and is hence a factor that has to be balanced.

(The writer is chief economist, CARE Ratings)

Updated Date: Jan 08, 2019 07:16:15 IST