Transforming welfare delivery in India: Bridging Intent-Impact divide

Fact: India is a welfare state; Defined by a very complex citizen demography of 140 crore people, infant mortality of over 25 per 1,000 live births, gross-enrolment-ratio of 27 per cent in higher education, over 10 per cent population above the age of 60 years, literacy rate of only 74 per cent (65 per cent in females) and over 21 per cent poor, India apportions approximately 34 per cent of its expenditure on benefit and welfare schemes every year.

As per the Expenditure Profile published by the Ministry of Finance, the Government of India committed an estimated Rs 10 lakh crore to over 700 welfare schemes in FY 21-22. Further, state governments have committed over Rs 15 lakh crore in targeted welfare schemes across sectors for their residents. Of these, schemes related to rural employment, agriculture, water supply, health and women and child welfare alone contributed to over 50 per cent of the welfare expenditure.

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Fact: India is a welfare state; So, a recent debate over welfare vs. ‘revdi’ made for a curious conversation about the difference between them and whether in an Indian context, they are the same, especially when they have a political hue.

Differences or sameness notwithstanding, the debate appears to imply that a welfare scheme must deliver on its promises in full, reaching every eligible beneficiary and realising its intended impact in terms of social-economic well-being and inclusion. However, the intricacies of managing such a large welfare delivery ecosystem have inherent inefficiencies including benefit leakages due to ghost beneficiaries (Haryana PDS found 12 percent ineligible beneficiaries), lack of standardization, disbursement failures (2-3 percent DBT transfer failed in the last 3 years), skewness in fund utilization, low beneficiary awareness, etc. These inefficiencies are regardless of the intent, administrative or political. Most of these inefficiencies exist since each line department manages the delivery of its respective schemes independently with little or no inter-departmental communication. Further, a weaker policy and governance framework, sporadic use of technology, insufficient fund availability, and limited department-level capacities are among the other key reasons.

Citizen data is spread across disparate government databases

The biggest reason for them is all is the inability to identify the eligible beneficiary as citizen data is spread across disparate government databases with limited-to-no integration. There is no “Gold Data” about each citizen, which is accurate and up to date. Databases such as the Socio-Economic and Caste Census (SECC) were not designed from a welfare delivery perspective.

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Hence, to make welfare delivery efficient in India, there is a need to implement a common citizen’s database, which shall act as a single source of truth for welfare delivery. Brazil’s “Cadastro Único”, Philippines’ “Listahanan” and Senegal’s “National Unique Registry” are some of the key examples of such citizen databases which are being efficiently used to deliver welfare schemes and subsidies. Further, it can be argued that a “family” is the smallest economic unit representing the collective aspiration of society, especially when Indian demographics are defined around family-based parameters like family income, landholding, caste, etc. Therefore, a citizen’s database should also be a family database.

Such a citizen database will have the following characteristics, i) promotes inter-departmental collaboration, ii) promote a common definition of a family, and iii) empowers citizens allowing them the ability to select benefits that best serve their aspirations.

In a country with a demography as diverse as that of India, technology is the biggest equalizer. Therefore, a beneficiary-led welfare delivery platform needs to be established with a Citizen Database at its core to tackle delivery issues and fund distribution to desired beneficiaries. Such a common citizen database-led platform can bring a paradigm shift in the delivery of welfare schemes in India by dispensing the power to choose the nature and number of benefits from the Government to the beneficiary.

It would provide many benefits:

1. a)Evidence-led Policy Formulation: Schemes/policy evaluation shall be based on data-backed indicators to help administrators evaluate what works.
2. b)Personalized Scheme Delivery: Government can design its scheme budgets using a bottom-up approach leading to better fund utilization and reduction in skewness across schemes.
3. c)Proactive service delivery: Government can reach out to a citizen found eligible for a service rather than the other way around. e.g., an SMS may be sent out to all eligible beneficiaries turning 60 years of age informing them that they may be eligible for the Old Age Pension scheme.
4. d)Increased financial inclusion: Government can identify the poorest of the poor households receiving minimal or no government subsidies which shall enable them to formulate innovative schemes around such households leading to enhanced coverage of beneficiaries.
5. e)Reduced ghost beneficiaries: With ‘Gold Data’, information consistency across all service delivery databases shall be maintained leading to a significant reduction in ghost and ineligible beneficiaries.

A technology-driven citizen database in India, a country that spends over 6 percent of its GDP on welfare schemes, has the highest potential to ensure every rupee is accounted for, no eligible citizen is left behind and India realizes its latent Demographic dividend!

The writer is Managing Director, Primus Partners. Views expressed are personal.

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