Who should get government welfare benefits? And who should not?

This piece originally appeared on Livemint.com

 

For Angus Deaton, the winner of the Nobel Prize for economics this year, poverty and its measurement has been an area of interest and practice, especially in the Indian context. While being critical of poverty estimation frameworks adopted by India, he makes a case for delinking welfare benefits from poverty estimates.

Interestingly, after the poverty line, the Indian government is looking to move to a new framework to determine beneficiaries of welfare entitlements. This framework is grounded in the Socio Economic Caste Census (SECC), the numbers for which were released this July for rural India.

The data visualization below shows the impact this new framework, if adopted, will have at the state level in terms of inclusion and exclusion. SECC divides households into three brackets:

Automatic exclusion: SECC looks at 14 questions relating to attributes like income, asset ownership and living standards. If a household has answered ‘yes’ to any one of these 14 questions, it is automatically excluded from government welfare schemes. Across India, around 40% of households fall in this bucket.

Automatic inclusion: It also looks at five questions related to social position and standard of living. If a household answers ‘yes’ to even one, it is automatically eligible for welfare schemes. Across India, less than 1% of households were placed in this category.

Conditional inclusion: That leaves about 59% of households. To place them, the SECC looks at seven questions on deprivation to assess a household’s social and economic vulnerability.

Scores for each household will be calculated, depending on their responses to the seven deprivation criteria. Those scoring above a cutoff could be included in the beneficiaries’ list, others left out.

In this framework, the key question will be where the government sets the cutoff. The range is wide: while 18% of households across India answered ‘yes’ to any one of the seven deprivation criteria, only 1% did so for all seven. The differences are also stark across different types of households: for instance, 45% of general households will be excluded in this framework, but only 21% of tribal households. It could well come down to a number.

Chart 1 shows where different states are, based on SECC questions. Slide the deprivation criteria filter to see the change and use the drop down to select different types of households.

Chart 2 visualizes all SECC data for all states for six kind of households. Click on smaller charts to view them in greater detail. Charts where all points are vertically aligned indicate lower inter-state variations.

 

 

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News in Numbers – June 17, 2015

 

21-month low

At Rs 64.25 against the US dollar, the value of Indian currency closed at a 21-month low on Tuesday, as overseas investors pulled out some of their money from the Asia’s third largest economy. With exports recording a decline of 20% in May this year, the falling value of rupee may aid the exporters to increase their competitiveness. Dip in exports hasn’t widened trade deficit as imports too fell because of lower crude oil prices.


928

In a country with over 1.25 billion population, just 928 households own a fifth of India’s private financial wealth, according to a global wealth report by Boston Consulting Group. India ranks fourth among countries with the highest number of households with over $100 million. Asia (excluding Japan) is expected to overtake North America in terms of private financial wealth in another four years. In a stark contrast, in 2010, one out of every three extreme poor people were in India, according to the United Nation’s Millennium Development Goals Report 2014.


30%

Indian firms are depending less on bank credit to borrow, as they are able to raise money at a cheaper cost through market loans and foreign borrowings. Three years back, bank credit accounted for nearly half of debt taken by companies. Vodafone Group Plc, the parent company of India’s second largest mobile service provider, raised Rs 7,500 crore rupee bond at 10.25% coupon rate. A part of this will be used to refinance costlier bank loans.


99%

That’s the cut-off for Commerce students for admission in English Honours class in Delhi-based St Stephen’s College for the 2015 academic session. The equivalent cut-off for Science is 97.75% and 97.5% for Humanities. These are the highest among the subjects on offer at the college. St Stephen’s has received a record 32,100 applications this year, of which 400 would gain admission.


≈20%
,

Coimbatore (21%) and Mumbai (19%) are the top two cities with the highest incidence of chronic constipation. Almost one out of every five people in these two cities suffer from this less-talked about problem. The findings are a part of a survey conducted by Abbott, a pharma company and Ipsos, a market research agency. Overall, about 14% of people in urban India battle this problem.

 

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