Poverty and Socio Economic Caste Census – SECC

Poverty and Socio Economic Caste Census – SECC

Part of: GS-II- Governance and poverty (PT-MAINS-PERSONALITY TEST)

Socio Economic Caste census (SECC):

An Expert Group under the Chairmanship of former Finance Secretary  Sumit Bose was constituted to study the objective criteria for allocation of resources to States and identification and prioritization of beneficiaries under various programme using Socio-Economic and Caste Census (SECC) data. The committee has recently submitted its report to the ministry of rural development (MoRD) and has recommended the use of SECC data for all government schemes instead of the below poverty line (BPL) data.

What is SECC?

• The SECC was commissioned by the previous government in 2011 to canvas every household ( urban and rural) in the country to ascertain their socio-economic status so as to allow both central and state governments define poverty and to take steps to eliminate various types of deprivations faced by the Indians.
• SECC was a mega project conducted jointly by three ministries vice MoRD, ministry of housing, urban development & poverty alleviation and ministry of home affairs.
• This was the first time since 1931 to ask every person their caste name to allow the government to re-evaluate which caste groups are well off and which caste groups are worst off and to better target the welfare schemes.

7 Criterias used in SECC:

1. Households with only one room , with no solid walls and roof
2. Households with no adult male aged 15-59.
3. Female headed households
4. Households with differently abled members
5. Households with no able bodied members
6. SC/ST households with no literate members above the age of 25years
7. Landless households deriving major income from manual labour.

Findings of SECC:

• A total of 24.39 Crore households are surveyed.
• 91 Crore are rural households.
• About 30% of the rural households are landless and derive major part of their income from casual, manual labour.
• Among the land holdings,40% is not irrigated. Just 4% own any sort of mechanized agricultural equipment and just 10% own irrigational equipment.
• Only 4.6% of the rural households pay income tax.
• Nearly 75% of households earn less than Rs 5000 per month.
• Less than 5% of SC/ST households earn more than Rs 10000 per month.
• Only 5% of rural households depend on government jobs, 3.57% on private sector jobs.
• As per the SECC data 36% of rural India is illiterate.
• 52% rural households have no literate adult above 25 years.
• Of the 64% literate rural Indians, only 1/5th have completed their primary education.
• Only 5.4% have completed high school and a mere 3.4% have graduated from college.
• A little more than 48% of the rural population is female and only 12.8% of the rural households are headed by women. Lakshadweep has the highest percentage of women-headed households with nearly 40% of the houses headed by women.
• This was the first census which released the data on trans-genders. Trans-genders comprise only 0.1% of India’s rural population.

Importance of SECC:

Presently poverty in India is determined using the BPL method which is based on the income required to purchase food items (determined using calorie norms) and non-food items ( clothing, education etc).

• SECC is more targeted and precise than the BPL method. While the BPL method identifies the number of poor people, SECC identifies who actually are poor. This will help in improving the efficiency of the government schemes and programmes, leads to better identification and targeting of beneficiaries and avoid duplication and fraud.
• BPL method uses income as the sole criteria to define poverty but income alone can miss a lot. Poverty is multidimensional and SECC takes this aspect into account while determining poverty. A multidimensional approach is very necessary for the success of poverty alleviation programmes.
• For example, an area in which most people are deprived of education is going to require a different poverty reduction strategy when compared to an area where most people are deprived of housing facilities.
• The deprivations faced by poor in various fields such as education, health, sanitation etc are not accounted in BPL method but are accounted in SECC. So SECC will help in not only poverty eradication but also eradication of various deprivations.
• The gender-related issues of poverty is taken into consideration in the SECC which was missing in the BPL method.

Drawbacks of SECC

• Even though SECC was conducted in both urban and rural areas, the government has released only SECC data of rural India.
• SECC collates data regarding the caste of the people. This caste related information faces the danger of being misused by political parties for their ulterior motives.
• SECC data must be regularly updated in order to remove beneficiaries who have overcome their deprivations. This will put a huge burden on the part of the government.

All about Poverty, Poverty line, BPL and APL (Important for PT-cum-Mains)

In India, Planning Commission estimates the number and proportion of people living below the poverty line at national and State levels, separately for rural and urban areas. It makes poverty estimates based on a large sample survey of household consumption expenditure carried out by the National Sample Survey Organization (NSSO) after an interval of approximately five years.

The Commission has been estimating the poverty line and poverty ratio since 1997 on the basis of the methodology spelt out in the report of the Expert Group on 'Estimation of Number and Proportion of Poor' (popularly known as Lakdawala Committee Report).

Definition:

Poverty is a social as well as a multidimensional phenomenon. According to the World Bank, “poverty is pronounced deprivation in wellbeing.” Amartya Sen in his capability approach perhaps gave the broadest meaning to well-being. According to him well-being comes from a capability to function in society. Poverty arises when people lack key capabilities due to inadequate income or education, or poor health, or insecurity, or low self-confidence, or a sense of powerlessness, or the absence of rights such as freedom of speech.

Multidimensional Poverty Index:

The Human Development Report (2010) pioneered the Multidimensional Poverty Index (MPI) which is grounded in the capability approach and an innovative effort to complement the income based poverty indices. It includes an array of dimensions from participatory exercises among poor communities and an emerging international consensus. The MPI shows the share of population that is multidimensionally poor adjusted by the intensity of deprivation in terms of living standards, health and education.

Some Estimates:

1.         Global Estimates: Based on new internationally comparable data, World Bank has found that “poverty levels across the globe have declined, with 1.4 billion people (one in four) in the developing world living below US$1.25 a day in 2005, down from 1.9 billion (one in two) in 1981. In other words, global poverty rates fell from 52% in 1981 to 26% in 2005.”

2.         Estimates for India: World Bank estimates for India also indicate a continuing decline in poverty. The revised estimates suggest that the percentage of people living below $1.25 a day in 2005 (which based on India’s PPP rate) decreased from 60% in 1981 to 42% in 2005. Even at a dollar a day poverty declined from 42% to 24% over the same period.

Poverty estimation methodologies in India:

The BPL methodology used to estimate poverty has been developed over the years based on the recommendations of various committees,

1. Alagh committee

• Dr.Y.K. Alagh committee was set up in 1979 to determine a formula to measure poverty in India
• This committee recommended the “ minimum calorie intake” formula to define the poverty line. As per this formula people who consumed less than 2400 kilocalories per day in rural areas and 2100 kilocalories per day in the urban area were considered poor. Thus, the calorie intake became the basis for poverty line in India.
• However, this methodology was criticized by many as it takes in to account only consumption levels to measure poverty and leaves out other deprivations faced by people such as deprivations in education, health etc.

2. Suresh Tendulkar committee

In order to develop a better methodology of poverty estimation, an expert panel was constituted by the Planning commission in 2005. This committee was headed by prof. Suresh Tendulkar. The committee submitted its report in 2009 and recommended moving away from calorie intake method.

• The committee recommended adopting  ” M.R.P based consumption expenditure “ methodology to determine the poverty line.
• The consumption expenditure method included both expenditures incurred on calorie intake as well as on other essentials like clothing, footwear, education, medical expenses etc.(both food and non-food).
• As per the recommendations of the Tendulkar committee, the poverty line was based on” monthly per- capita consumption expenditure” (MPCE). And the MPCE was fixed at Rs 673 per person per month for rural areas and Rs 860 per person per month for urban areas.
• The committee recommended updating the MPCE levels every year after taking inflation in to account.
• The Tendulkar committee’s recommendations led to huge uproar all over the country. It was accused of setting the MPCE very low to artificially push down the poverty levels.

3.  N. C. Saxena committee

• The rural development ministry in 2008 appointed a committee headed by N.C.Saxena to revise the parameters to calculate the poverty figures in the rural areas.
• The committee came out with new criteria of” automatic inclusion and automatic exclusion” in poverty estimation.
• According to this criteria, some disadvantaged families should be considered poor automatically and some families enjoying certain benefits should be excluded from the poverty estimation.

4. . Rangarajan committee

• The government appointed this committee in 2012 to revise the methodology of poverty estimation after the Tendulkar committee fiasco.
• The committee submitted its report in 2014 and fixed the MPCE for a person at Rs 972 for rural areas and Rs 1407 for urban areas.
• The committee preferred to use monthly per-capita expenditure of household of five rather than MPCE of an individual. This came out to be Rs 4860 per household in rural areas and Rs 7035 per household in urban areas.

Methods in India to calculate poverty:

In India there are two methods of estimation namely Uniform Recall Period (URP) and Mixed Recall Period (MRP).

1.         Uniform Recall Period:

On the basis of NSS 61st Round (July 2004 to June 2005) consumer expenditure data, the poverty ratio is estimated at 28.3 per cent in rural areas, 25.7 per cent in urban areas, and 27.5 per cent for the country as a whole in 2004-05 using uniform recall period (URP). In URP, consumer expenditure data for all the items are collected for a 30-day recall period.

2.         Mixed Recall Period:

Whereas based on mixed recall period (MRP) for the same period, the poverty ratios are 21.8 per cent in rural areas, 21.7 per cent in urban areas, and 21.8 per cent for the country as a whole. In MRP, consumer expenditure data for five non-food items, namely clothing, footwear, durable goods, education, and institutional medical expenses, are collected for a 365-day recall period and the consumption data for the remaining items are collected for a 30-day recall period.

Poverty Line:

The poverty line in India is income based. The poverty line was originally fixed in terms of income/food requirements in 1978. It was stipulated that the calorie standard for a typical individual in rural areas were 2400 calorie and was 2100 calorie in urban areas.

Then the cost of the grains (about 650 gms) that fulfill this normative standard was calculated. This cost was the poverty line. In 1978, it was Rs. 61.80 per person per month for rural areas and Rs. 71.30 for urban areas. Since then the Planning Commission calculates the poverty line every year adjusting for inflation.

The poverty line in monetary terms (i.e. Rs. Per capital per month) during 2005-06 has been estimated at Rs. 368 in rural area and Rs. 560 in urban area as compared to Rs. 328 in rural area and Rs. 454 in urban area in 2000-01. The state specific poverty lines have also been estimated by the planning commission for the year 2004-05 in monetary terms (Rs. Per capital per month)

Methodology for estimating BPL: The methodology of estimating poverty and the identification of BPL households have been a matter of debate. Two committees under the chairmanship of Prof. Suresh D. Tendulkar and Dr. N.C. Saxena have submitted their reports on methodology for estimation of poverty and methodology for conducting BPL census in rural areas, respectively. Further, an Expert Group under the chairmanship of Prof. S.R. Hasim has been set up to recommend methodology for identification of BPL families in urban areas.

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