Only 15 paise reaches the beneficiary

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In the 1980s Rajiv Gandhi, then the Prime Minister of India, had said that for every rupee targeted towards welfare and poverty alleviation only a fraction, 15 paise, reached the intended beneficiary. [1] [2] This observation by the Prime Minister has been called a guess, an estimate, not based on empirical data. [3] While the statement has been connected to corruption, it has also been taken as an understanding of the large operating costs and overheads of administering public services. [4] India's Chief Vigilance Commissioner later added that of the remaining, "40 paise perhaps can be accounted for administrative overheads and 45 paise is pure corruption". [5]

It has also been felt and politically stated that even less than 15 paise is a truer estimate in some cases; 10 paise, [6] even less than 5 paise. [7] In 2007, in the same context, deputy chairman of the Planning Commission Montek Singh Ahluwalia said that the amount that reaches the poor has reached 50%. [8] [9] In 2009, Prime Minister Manmohan Singh agreed that there were still leakages, however not to the tune of what Rajiv Gandhi had felt. [10] [11] An empirical estimate based on a later study under economist Kirit Parikh came up with the figure of 16 paise. [4] This figure varies between state and program. A 2005 study stated "one rupee of budgetary consumer subsidy is worth only 27 paise to the poor" with a finding that about 58% of food grains do not reach the intended target. [2]

Following implementation of Aadhaar, direct benefit transfer, and with other improvements in last mile delivery, Prime Minister Narendra Modi would go on to state that for every rupee, every paisa will reach the poor. [12] [13] [14]

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References

  1. ↑ Saksena, Devendra (10 August 2017). "The 85-paise riddle!". The Statesman. Retrieved 21 April 2022.
  2. 1 2 "'Only 15 paise reaches the needy': SC quotes Rajiv Gandhi in its Aadhaar verdict". Hindustan Times. Press Trust of India. 11 June 2017. Retrieved 21 April 2022.
  3. ↑ Pritchett, Lant; Aiyar, Yamini (June 2015). "Value Subtraction in Public Sector Production: Accounting Versus Economic Cost of Primary Schooling in India" (PDF). CGD Working Paper 391. Center for Global Development, Washington, D.C.
  4. 1 2 Habibullah, Wajahat (20 August 2019). "Rajiv Gandhi and his vision of democracy in India". National Herald. Retrieved 21 April 2022.
  5. ↑ Singh, Sanjeet (20–22 October 2005). "Fighting Corruption in Developing Countries : Dimensions of the Problem in India" (PDF). Warsaw, Poland: PIARC Seminar on Good Governance, Institutional Integrity, and Human Resources Management for Road Administrations. Archived from the original (PDF) on 21 April 2022.
  6. ↑ Bhaumik, Saba Naqvi (15 November 1996). "Campaign for right to information in Rajasthan exposes rot in system in villages". India Today. Retrieved 21 April 2022.
  7. ↑ Joy, Santosh K (17 January 2008). "Rahul echoes Rajiv Gandhi's comment on public fund". Rediff.com. Retrieved 21 April 2022.
  8. ↑ Singh, Sangeeta (7 December 2007). "Ahluwalia says 50% leakage in grain distribution is unacceptable". Livemint. Retrieved 21 April 2022.
  9. ↑ "Montek moots 'budget tracking system'". Hindustan Times. PTI. 7 July 2009. Retrieved 21 April 2022.
  10. ↑ "Fund 'leakage' not as big as Rajiv Gandhi mentioned: PM". The Hindu. PTI. 11 October 2009. ISSN   0971-751X . Retrieved 21 April 2022.
  11. ↑ "PM admits to fund 'leakage', but not as big as Rajiv said". Zee News. 11 October 2009. Retrieved 21 April 2022.
  12. ↑ "When my govt releases Re 1, poor will get the entire 100 paise, says Modi". The Week. 23 August 2018. Retrieved 21 April 2022.
  13. ↑ "No place for 'middlemen' in my government, every paisa reaches poor: PM Narendra Modi". The Economic Times. PTI. 23 August 2018. Retrieved 21 April 2022.
  14. ↑ "Direct transfer benefits now fully reaching farmers: PM". The Statesman. 19 April 2022. Retrieved 21 April 2022.
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