Survey of social security pensions in Jharkhand shows the problems Universal Basic Income could face

At a time when the idea of Universal Basic Income is being discussed at the highest levels of Indian policymaking, a ground survey of the National Social Assistance Programme, which is similar in design, lays bare the challenges in ensuring universalisation of cash transfers.

The Economic Survey 2016-’17 conceives of the UBI as a substitute for welfare schemes such as social security pensions, subsidised food grains and the National Rural Employment Guarantee Act. It is argued that these schemes are prone to misallocation, leakage and inclusion errors. The UBI, which aims to provide a minimum income to all citizens based on the principle of universality, is touted to be the antidote to such alleged challenges.

While the UBI needs a much wider debate, the long-standing National Social Assistance Programme already offers many important lessons. Under the programme, stipends between Rs 200 and Rs 2,500 are paid into the bank accounts of the elderly poor, widowed and disabled persons. It is, therefore, a minimum income to a clearly defined demographic – much like the proposed UBI. There are two marked similarities in design – universality within a targeted vulnerable population, and clear identification criteria.

The National Social Assistance Programme stands out among existing social security schemes for low levels of leakage and fairly accurate targeting. But exclusion of eligible persons, budget freezes and disruptive technological experimentation pose serious challenges. In any case, we hear little about the achievements and challenges of this programme, which is already doing what “new” social security measures like UBI, propose to do.

In July, two Sahayta Kendras in Jharkhand conducted a rapid verification of the programme in one gram panchayat each in Garhwa and Gumla districts. Sahayta Kendra is an independent help centre at the block level, managed and run by citizens in a voluntary capacity, to help each other access their entitlements. While this verification exercise is not representative of the programme across the state, it provides a view from the ground of the implementation challenges that remain.

Arbitrary exclusion

The arbitrariness of exclusion cannot be attributed to frontline state functionaries alone, for it originates at the stage of budget allocation, legitimised by parliamentarians and senior administrators. The central government’s budget for the National Social Assistance Programme was slashed by about 20% in 2015-’16 and has declined in real terms since. The budgeted amount is barely enough to cover about 30% of the eligible beneficiaries.

To compensate, states have stepped up to some extent. The Jharkhand government has supplemented budget allocations to increase the amount to Rs 600 per month and expand coverage. However, even this is sufficient to cover only about half the state’s elderly population. There is a formal commitment to universality in beneficiary selection in the programme’s guidelines issued by the Ministry of Rural Development in 2014. Yet, informal communication to the contrary means that a culture of quotas continues on the ground. This leads to the arbitrary rationing of funds, arbitrary prioritising of eligible beneficiaries and the complete breakdown of accountability.

Another source of exclusion is the lack of clarity about eligibility criteria, with slightly differential practices even among blocks. Although the Sumit Bose Committee has recommended that the Socio Economic Caste Census be used to identify pension beneficiaries, old Below Poverty Line cards are still being insisted upon in Gumla. In any case, either is far from universal. There is no practice of maintaining a written record of the total applications received at the block office. The only record available is the final list of sanctioned pensioners, making it impossible to trace how many have been rejected at the block or sub-divisional level, and the reasons for rejection. This deliberate obfuscation of processes absolves the administration of any accountability to those citizens whose applications do not make the cut.

It is no surprise then that a small-scale verification of pension lists in five villages of one gram panchayat resulted in close to 200 eligible pensioners showing up at the Sahayta Kendra office the next day with their passbooks and multiple identity documents. They complained that they had unsuccessfully applied several times for pensions, and asked for help in submitting yet another form.

Positively, Jharkhand has made 21-day timelines for pension verification and sanctioning enforceable under the Right to Guarantee of Service Act, 2011. However, for pension applicants, nothing has changed in practice – applications submitted are not registered and receipts are not provided. Starting this year, the JharSewa portal provides for online submission of applications through Pragya Kendras or Common Service Centres, located at the block and panchayat levels. Separating the submission process from the verification and sanctioning process and creating a digital record of the decision-making process is a welcome move as it should increase accountability, but, sadly, the system is easy to game. One Pragya Kendra operator in Gumla explained: “The Block Development Officer and Circle Officer have instructed us to not enter pension applications. They say there is a limit to the number of applications they are supposed to accept but the online database allows for unlimited entries.”

Irregular payment

Although most of the money allocated for pension schemes is spent, disbursal is extremely irregular. In 2013, a study in Khunti district showed that the majority of respondents did not receive their pension monthly. In another study in Latehar district, the pension delays ranged from one to six months. A recent study in Ranchi district had 38% of the respondents reporting that they did not receive money for periods ranging between one month and eight months during the preceding year. The findings from this verification exercise show that there has been no change from previous years and if anything pension payments have become slightly more unpredictable. In Garhwa, of the 103 pensioners we met, 40% said they had received their last pension payment over six months ago. Some of these could even be classified as “stopped pensions” as no payment had been received for over a year.

The Jharkhand Social Welfare Department’s website showed that the payments had been credited into the beneficiaries’ accounts but their bank or post office accounts did not reflect it. The government must explain how these pensions were “lost” in transit. This is particularly disappointing given that several sets of guidelines and committees, even the Supreme Court’s orders, have iterated the need for regular pension payments, by the 7th of every month.

Costs of Aadhaar

In addition to these forms of exclusion and delays that are weighing the programme down, disbursement of pension through mini-banks and its mandatory linking with Aadhaar, the 12-digit unique identity number, has had a compounding effect in some cases. Theoretically, this could be a great convenience. But it is not so much in reality, for two reasons – problems with Aadhaar cannot be solved locally and records with beneficiaries are disappearing, both of which are undermining accountability.

Ramani Devi, about 95 years old, has been getting a pension for three years. She is bed-ridden, so having the money transferred to her account through a mini-banking facility, provided at the local Pragya Kendra, was welcome. For this, however, she required an Aadhaar number and a bank account linked to the Aadhaar. And for every withdrawal, she must authenticate her biometric information stored in the Aadhaar database. To Ramani Devi’s dismay, she was denied her pension four months ago because the payment machine suddenly did not recognise her fingerprints. In such cases, there is little the Pragya Kendra or the Block Office can do. The only way to rectify this is for her to travel 20 kilometers to the regional Aadhaar headquarters to re-register her fingerprints. This turns on its head the supposed convenience and decentralisation of “doorstep delivery”.

No one appears to be responsible for this – the Pragya Kendra, the department implementing the scheme or the Unique Identification Authority of India, which manages the Aadhaar database. If at all Ramani Devi manages to resolve the problem before she is presumed dead and struck off the list, she will receive no compensation for this trouble created by what is supposedly the panacea for all ills afflicting welfare schemes – Aadhaar.

The move to mini-banking facilities has also meant the weakening of the already poor practice of maintaining and updating passbooks. Lack of records at an administrative level detailed above is mirrored at the pensioner level. Most of the beneficiaries who have opened accounts through mini-banks have not received passbooks but just “ID slips”. Receipts of pension payments are rarely provided and if at all, they are charged for. Moreover, Pragya Kendras do not have the provision of updating passbooks at the time of disbursement. So, pensioners have no consolidated record of the payments.

The National Social Assistance Programme guidelines read like an exercise in wishful thinking given the complete lack of enforcement on the ground – whether regarding universal identification, timely payments, pension passbooks or social audits. This apathy towards pensions makes the enthusiastic support for Universal Basic Income all the more ironic. The survey in Jharkhand – just a snapshot of the implementation of a cash transfer, supposedly universal, to a clearly defined demographic – should serve as a sobering caveat. Morally, and practically, the path to reform is clear – universalisation with clear exclusion criteria, citizen-friendly application processes, and an iron-clad commitment to timely delivery of benefits.

Anindita Adhikari is a doctoral student of sociology at Brown University, US. Inayat Anaita Sabhikhi is a social accountability fellow at Tata Institute of Social Sciences, Mumbai.