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Union Budget: Economists ask Jaitley to enhance old age pension, maternity benefits

Sebastian Sunny | Updated on: 20 December 2017, 20:48 IST
A group of leading development economists in the country has written to the Union Finance Minister Arun Jaitley asking for a hike in the budget allocation for social security pensions and maternity entitlements. Writing in the context of the forthcoming Union Budget, the economists who include Jean Drez, Honorary Professor of the Delhi School of Economics, Sukhadeo Thorat , Professor Emeritus, Jawaharlal Nehru University said that the Centre’s contribution of Rs.200 per month towards old-age pension under National Old Age Pension Scheme (NOAP) was too measly and “extraordinarily stingy.” Similarly, the widow pension should be raised from Rs.300 a month to at least Rs.500, they have pleaded.
 
“It is also a missed opportunity. NOAPS is a good scheme (with low leakages and administrative costs) that reaches some of the poorest members of society. The Central Government’s contribution should be immediately raised to Rs 500 (preferably more) at the very least. This requires an additional allocation of Rs 8,640 crores or so, based on the current NOAPS coverage (2.4 crore pensioners),” the appeal, signed by 60 economists, said.
 
The signatories include Ashok Kotwal, Professor of Economics, University of British Columbia, Ashwini Deshpande, Professor of Economics, Delhi School of Economics, Bharat Ramaswami, Professor of Economics, Indian Statistical Institute, New Delhi, Vijay Shankar Vyas, Professor Emeritus, Institute of Development Studies, Jaipur and Vijay Joshi, Emeritus Fellow, Merton College, Oxford University, among others. 
 
“Widow Pensions should be raised from Rs 300 per month to Rs 500 at the very least. This would cost just another Rs 1,680 crores. Maternity benefits of Rs 6,000 per child are a legal entitlement of all Indian women (except those already covered in the formal sector) under the National Food Security Act, 2013. For more than three years, the central government did virtually nothing about this,” they said. 
 
It is being pointed out that on January 31 last year, Prime Minister Narendra Modi had announced that maternity benefits would be provided soon. “One year later, however, (1) the new scheme framed for this purpose (Pradhan Mantri Matru Vandana Yojana) is yet to be operationalised, (2) the provision made for it in the Union Budget 2017-18 (Rs 2,700 crores) is barely one third of what is required based on NFSA norms; and (3) in flagrant violation of the Act, PMMVY restricts the benefits to Rs 5,000 for just one child per woman,” the appeal pointed out.
 
The economists have argued that the Union Budget 2018-19 should provide for full-fledged implementation of maternity entitlements as per National Food Security Act (NFSA) norms. This required only Rs. 8,000 crores, based on a 60:40 ratio, for Centre: State contributions. It is very important to streamline payment systems so that pensions and maternity benefits reach the recipients on time –every month, by the 7th day-- as directed by the Supreme Court in its November 28, 2001 order.
 
The economists pointed out that while the importance of maternity entitlements was well articulated in the Economic Survey 2015-16, in the chapter on “Mother and Child” this was not reflected in the previous (2016-17) Budget.  
First published: 20 December 2017, 20:48 IST
 
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