Friday, July 26, 2013

Poverty line is pretty invisible Gujarat beat Bhuj quake blues back, brick by brick

STATUS QUO The new benchmark won’t bring about any changes in the impact of any govt scheme
After initial hiccups, most lives back on track

The Planning Commission’s new poverty line will have no bearing on any government scheme since the poverty numbers are no more linked to public entitlements.
The government used to give food entitlements under the Public Distribution System (PDS) on the basis of the poverty line. The existing PDS entitlements covers 34% of 2011 population based on the 1993-94 poverty numbers.
Government officials said that under the national food security law — to be implemented in the next six months — the commission has prepared state-wise coverage for getting subsidised food. “It is an entirely different exercise and has nothing to do with the new poverty numbers,” a senior plan panel official said.
The commission had on Tuesday announced that 21.9% of Indians were poor as per the consumption expenditure survey of 2011-12.
It means a fall of around 15 percentage points in poverty numbers since 2004-05.
For the last data, the panel had tracked poverty numbers between 2004-05 and 2011-12, the period of the UPA’s rule.
The new poverty data has created a controversy, with economists and political parties claiming that the number was not realistic as the panel had kept the poverty line abysmally low. The poverty line is based on an individual’s consumption expenditure, which is R27.2 per capita per day in rural India and R33.3 in urban areas.
Many economists agree with the panel’s view that the poverty line has no implication for government policies.
Their concern is that the low poverty line projects wrong depiction of the impact of government policies as it does not take into account the “realistic” impact of inflation on a person’s expenditure.
The CPM also slammed the panel for its poverty estimates, saying it was “mocking the lifeand-death struggles” of people amid continuous rise in prices and slashing of subsidies.
“The urban poverty level definition would not be sufficient to buy even one kg of decent variety of rice in the open market,” CPM leader Sitaram Yechury said while describing the poverty line as “absurd”
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