For NITI Aayog, Government Services are Injurious!

R Arun Kumar

NITI Aayog counterposes government’s role in production with that of provision of services. In its Three Year Action Agenda, in one section it states: “As the government contains its role in manufacturing, it must also expand its role in the promotion of public health and quality education”. Contradicting this statement, at another place, it states: “sectors like health and education also need to be opened up for viable PPP models to accelerate sustainable development”. The essence of its Three Year Action Agenda and policy advocacy is, it wants the government to withdraw from both, vacating the space for private participation.

The World Bank (WB) directed the government to eliminate most of the existing subsidies for fertilizers and restructure subsidies for food (India: 1991 Country Economic Memorandum). Further it directed for ‘enhanced cost recovery for a variety of government services’ and ‘reduce the growth of government employment’. Of course these directives are coated with sugar – ‘reallocation of expenditure’ and ‘better targeting’, but not ‘cut in expenditure’.

The ever loyal NITI Aayog first targets food subsidies. Arguing that ‘there is scope for containing expenditure on food subsidies’ it wants the government to put into use the Socio-Economic and Caste Census (SECC) and provide them only to the ‘targeted’ beneficiaries. It wants this to be distributed through ‘direct benefit transfer’ or ‘cash transfers’. It wants the ICDS supplementary nutrition component to be implemented through a conditional cash transfer route. Similarly, it suggests changes even in the Mid-day meal scheme (MDM). It endorses the NGOs and private agencies involved in this scheme, in spite of many adverse reports about their services. It wants ‘a partial substitution of cooked food with packed food’, thus helping the giant private snack manufacturers.

In the name of reducing subsidies, the Aayog advocates for a complete review of all the centrally sponsored schemes like the ICDS, MDM, ASHA and 28 such others. The express purpose of this review is because of its strong opinion that these schemes have proliferated and needs to be curtailed in order to ‘free funds’. It clearly states that after the review, basing on the outcome, some of the schemes should be closed and more importantly all the schemes should have a ‘sunset clause’, meaning an expiry date. This is one of the means to adhere to the long made promise to the WB and eliminate subsidies. This would sound the death knell for many schemes, which are in fact contributing to an extent for the improvement of health among the marginalised and disadvantaged sections.

The other sector that the Aayog comes out hard on, is education. It wants the government to reform the education system and make it industry friendly. The WB has been long arguing for decreased government role in education, particularly, higher education. India, as a signatory of the GATT treaty on services, has also committed to open up its education sector for foreign investment. One of the important conditions that our government has conceded to enter this treaty is to create a ‘level playing field’ for the private and foreign participants. This is nothing but agreeing to eliminate all kinds of subsidies and preferential treatment to the government institutions. Scholarships and reduction of aid are important components that the government has agreed to curtail.

The Aayog concludes that the ‘public school system has not achieved the desired outcomes in the country’ and that government should not bother about investing in ‘library, fees and playground’. It wants the government to close or merge schools, in the name of ‘resource maximisation’. Quality of education is heavily dependent on resource allocation. This is the story behind the better performance of Navodaya and Kendriya Vidyalayas, at times, even better than many of the private educational institutions. The Aayog completely discounts this fact. It wants the practice of appointing ‘unqualified contract teachers’ to continue and advocates providing the poor with ‘education vouchers’ – a practice advocated by the WB in its Report, ‘Making the Services Work for the Poor (2004)’. Moving further, it advocates public-private partnership (PPP) in education, particularly for the takeover of schools.

In higher education, it wants some 20 universities to be selected for their development into world class institutes. And this list should include equal number of private institutes too. Substantial sums of government resources should be spent on the selected government institutes, at the cost of other institutes. In this process, the ‘other’ institutes will be fed with the left-overs, pushing them to closure. Another outrageous proposal is to divide the universities/colleges into three tiers. The top tier would be prepared to compete globally and additional resources will be provided for them. The bottom tier institutes are only to increase the percentage of students in higher education and they will not be provided with much of funding. As they starve of funds and fall in quality, they can be ‘considered for closure’.

All through our history, education system was constructed in such a manner so as to favour the elite. It created islands of excellence, which were pumped rich with funds. These islands exist amidst an ocean of mediocrity, thanks to the discriminatory funding policies of the government. Those who have the money get quality education, and those who don’t, get sub-standard education. The NITI Aayog wants to widen this schism in education further – to global standards!

In the health care sector, the Aayog recommends the government to adopt the function of ‘strategic purchasing’, meaning, buy from private players. It hence wants to use government resources to further strengthen the private sector participation in this sector, in the guise that ‘competition helps’ in the better provision of services. Apart from its Action Agenda, the Aayog also involves in drafting some policy guidelines. In the guidelines it had drafted for the states on health sector, it wants the state governments to “decide to set up either a 50-bed initially with a scope to expand later or a 100-bed PPP facility within the identified district hospital”. This is coming even after the well known failure of PPP experiment in health care sector, particularly of the Karuna Trust that claims to manage 80 primary healthcare centers (PHCs) in seven states – Karnataka, Andhra Pradesh, Orissa, Arunachal Pradesh, Manipur, Meghalaya and Rajasthan.

The Aayog wants user charges to be levied on different services offered by the governments at various levels. Electricity tariffs should reflect the costs to be paid by the users. Private players should be allowed to collect these charges from the users. That is the reason why distribution companies need to be brought out of ‘State monopoly’. Similarly, urbanisation in our country should be promoted on the principle of ‘user-pay’. The AMRUT, SMART city mission announced by the government contain prescriptive reforms for the collection of user charges on water, solid waste disposal, sewage, road maintenance, etc. All these are according to the WB direction of ‘enhanced cost recovery for a variety of government services’. It wants the entry of foreign investment in real estate sector, change of land use patterns, land ceiling laws and sale of all ‘unused’ government land. Going a step further, to ensure compliance, Aayog wants an incentive of 10 per cent to be given to those local bodies that studiously implement reforms.

In order to ensure the implementation of all these reforms, the Aayog wants an entirely new administrative set-up. Justifying its presence by calling that ‘policy making is a specialised activity’, it wants the government to allow “specialists be inducted into the system through lateral entry” on fixed term contracts. This will be beneficial as it brings in ‘competition to the established career bureaucracy’. We have already seen who these specialists are and where they ‘attain’ their ‘knowledge’ and how they can wreak our economy and society. The Aayog wants to sytematise this process, by making it part of the governmental policy. It intends to “reduce dependence on government administrative machinery” and allow “private channels to provide services”. Providing us with more clarity on its proposal it states: “Identification of such services should be taken up and PPP models to provide those services should be explored”. Concretely, “Functions such as serving court summons and antecedents and addresses verification for passport applications or job verifications can be outsourced to private agents”! Remember, the WB had directed to ‘reduce government employment’ in 1991.

The Aayog also advocates election reforms, a blue print of what the BJP is advocating – simultaneous elections to both state assemblies and the parliament, introduction of election bonds, etc. But nothing on real reforms to eliminate corporate financing, money power or on proportional representation.

NITI Aayog wants many other reforms to be undertaken: unifying all tariff proposals, reduction of corporate tax, encouraging digital payments, liberalise trade in petroleum, remove the distortion in gas market and many more of such kind. Most importantly, it wants the establishment of two Coastal Economic Zones (CEZ) with no labour laws, with complete administrative autonomy and liberal business environment. It wants the government to conclude as many Free Trade Agreements as possible, particularly the FTA between India and the European Union. It wants the land acquisition act to be immediately amended. And of course reforms carried out at a faster pace and the promotion of PPP in almost all the sections of the economy.

The reasons for the hurry in implementation of the reforms are not difficult to fathom. It says, “The current scenario is conducive to this approach as one can tap the liquid international financial markets, which are flush with cash”. Due to the global economic crisis, finance capital is looking at avenues where it can invest safely and reap super profits. India, with its huge market and ‘untapped resources’ is a salivating prospect. In order to comply with their wishes, they needed a government with ‘strong political will’ and they found it in BJP. The government has created institutions like the NITI Aayog that can promote the case without the finance capital attracting any adverse criticism. With the compliance of BJP-RSS, any discontent on finance capital can be diverted by inciting sectarian violence in the name of religion and caste. Another important point is, all the ruling class landlord, bourgeoisie parties in the country are compliant in the implementation of neoliberal reforms. So finance capital can count on them in staying quiet or at best make symbolic noises.

The only alternate against the accelerated implementation of neoliberal policies, as prescribed by the NITI Aayog and implemented by the BJP government at the centre and various bourgeoisie landlord governments in the states is, to build a resistance centred on the alliance of workers and peasants. It is only this class alliance that can rally all other forces adversely affected by these reforms and wage militant struggles. The Left Democratic Front, which the CPI(M) seeks to build is an expression of this class unity. It is only through such militant struggles against the neoliberal policies that class unity can be built and all the efforts of communal and sectarian forces to break this unity in the name of religion, and caste can be thwarted. This is the direction of the 21st Congress of the CPI(M), which is more than ever relevant today and needs to be carried forward.

Newsletter category: