Is the new poverty cap right?

GN Bureau | September 22, 2011



The plan panel, in an affidavit, has proposed that to qualify as urban poor a person's daily expenses should amount to Rs 31 or lesser. To stay poor in rural areas, a person's daily expenditure can not go above Rs 26. The move has to cap poverty has come under fire from social actvists, media, and now as Times of India reports, from some mebers of the panel itself.

While it is necessary to define poverty in terms of income and expenditure, fixing such a low cap is bound to leave out a chunk of the population who would otherwise benefit from the government's schemes for the poor. With the price rise showing no signs of abating, the Rs 32-a-day figure seems an unrealistic and unsympathetic definition of poverty in the country. Besides, a overarching expenditure figure may itself be a problem as poverty becomes skewed by location as well. In metros, Rs 32-a-day may not even be adequate to buy a person a square meal a day.

The truths of poverty in India aside, the planning commission had been asked by the supreme court to explain the need for a cap that would limit the number of poor. The panel has failed to justify the caps and instead, reworked the Tendulkar committe figures, which were never intended as caps but as comaparative figures to study poverty.

So, has the plan panel done righty by fixing the poverty caps, and if so, is it right in having fixed it at the figures as suggested in the affidavit?

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