February 07, 2021

Callous Deception on Health Budget

AFTER the global Covid-19 pandemic exposed the dismal state of India’s public health system, one would have thought that the government would have learnt some lessons.  India’s public health expenditure is one of the lowest in the world and stood at 1.3 per cent of GDP in 2019.

The Modi government pushed ahead with privatisation of health services in a big way – something which began with the liberalisation policies in 1991.  A health system developed where there is a dominant private sector – corporate-run hospitals, private nursing homes, clinics and diagnostic centres.  Most of them charge exorbitant fees and run on the profit principle.  Alongside is a network of public health institutions which are under-funded, short of personnel and of poor quality.  As a result, out-of-pocket expenses constitute 62 per cent (of total health expenditure) and is a big burden on the poor and the middle classes.

It was with such a health system that the country faced the unprecedented Covid challenge.  India, till now, has the second highest number of Covid cases in the world and the third highest number of deaths.  At the successive peaks of the Covid epidemic in different states, the picture was of government hospitals overwhelmed with patients, lack of PPE equipment for health personnel, failure to put in an effective contact, tracing and surveillance programmes.  This despite the best efforts of doctors, nurses and other paramedical staff in government-run hospitals. 

While the number of Covid cases has been steadily declining over the past one month, there are apprehensions about a second wave occurring as it has happened in Europe.  Instead of acknowledging that there has been a neglect of public health and taking steps to remedy the situation, the Modi government has launched a self-serving campaign of how efficiently the virus has been tackled in India. 

The refusal to recognise the damning neglect of public health and taking corrective steps is reflected in the union budget presented by Nirmala Sitharaman. Worse, she makes the deceptive claim that the budget outlay for health and wellbeing has increased by a whopping 137 per cent.  The scale of deception is, indeed, breathtaking. 

A look at the figures in the annexure provided to the budget speech exposes this hollow claim. The budget estimate for 2020-21 had provided a total of Rs 69,234 crores for health.  This includes the allocations for the ministry of health and family welfare, ministry of ayush and department of health research.  The actual expenditure for 2020-21, as per the revised estimates on these heads, amounts to Rs 85,250 crores. But in the current budget estimate for 2021-22, the total allocation in these heads amounts to Rs 76,902 crores.  What this means is that there is a reduction of 11 per cent in the health budget from the actual expenditures incurred last year. 

A close look at the grand figure of Rs 2,23,846 crores being allocated for “health and wellbeing” reveals the sleight of hand involved.  Apart from the ministry of health and welfare, ayush and health research allocations, the allocation for drinking water and sanitation amount to Rs 60,000 crores has been added on.  So also the Finance Commission grant for water and sanitation of Rs 36,000 crore and Rs 2,700 crore for nutrition (which in itself is a 30 per cent reduction from last year). 

Further, there is the Finance Commission commited grant for health of Rs 13,192 crore and the one-time  allocation of Rs 35,000 crore for vaccines.  This amount would cover the cost of vaccine for around 70 crore people, without taking into account the cost of transportation, storage and other materials used for vaccination.  If the delivery cost is included in the amount, then it would probably cover only 40 crore people.  The government is opaque on how the costs would be shared with the states.  Anyway, this allocation indicates that the government is not provisioning for universal vaccination free of cost.

The other feature of the health sector in the budget is the announcement of a new centrally-sponsored scheme – Atma Nirbhar Swasthya Bharat Yojana.  This scheme would incur an expenditure of Rs 64,180 crores over six years as additional to the National Health Mission budget.  The scheme aims to develop capacities in primary, secondary and tertiary health system and to upgrade medical, research and laboratories and other public health facilities. 

However, there is no allocation whatsoever made in the budget for this scheme.  It is merely an announcement that will find no implementation in this financial year at least. 

Underlining this callous approach to public health is the deeply held belief in privatisation as a remedy for all ills.  This outlook purveys the entire budget which has stepped up privatisation of public sector units and financial institutions in a big way. 

The Economic Survey had called for increasing public expenditure on health from 1 per cent to 2.5-3 per cent of the GDP. The union health budget allocations are a regressive step from this point of view.  What this health budget underlines is the necessity to make public health a people’s issue and all democratic political forces should take it up as a priority in their political agenda. 
(February 3, 2021)