Time ripe for the govt to fulfil social security promises

Following the setback it received in the parliamentary elections, the BJP has set out to deliver in the social services sector to win back popular support. The ruling party is seeking to make good on some of the promises it had made during the election campaign.

What we have to see is if the government has the financial resources and skills to fulfil these promises. Also, perhaps more importantly, what is its record in actually delivering on similar promises it made earlier?

One promise is to make health insurance available to every citizen above 70, with few ifs and buts. This is vital, as the population is getting older. The other is to provide social security to gig workers, who currently have none. Their number is also likely to rise as online shopping increases with the spread of information technology.

The Union Cabinet has just expanded the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana, touted as the world’s largest public health insurance scheme, to make it applicable to all 70-plus people, irrespective of their income. It will have a cover of Rs 5 lakh per year and benefit around four crore citizens. This scheme will be available even to those who have private insurance cover.

The social security plan for gig workers will cover 77 lakh people. The premium for the cover will be paid for by the aggregators who use the gig workers’ services at 1-2 per cent of revenue. This will help create a social security fund, which will cover workers’ health insurance and other benefits outlined in the Code on Social Security that was passed by Parliament in 2020. It has not been implemented yet as the rules are still being finalised.

Why does the government feel confident that it has the resources to go through with these large social programmes? The economy is doing well, remaining the fastest-growing among all the large economies. In the last financial year, it clocked a record 8 per cent growth and remains highly robust in the current year with prospects of over 6 per cent growth. Helping it along is the stock market that ended on a high this mid-month.

There is also no chance of overheating, with inflation remaining within the bounden lines, courtesy in part the monsoon having arrived on time. Hence, the official interest rate is set to remain steady. Under these circumstances, the government has enough financial resources to pay for the outgo of the new project.

The health premium for the elderly will cost the Centre

Rs 3,437 crore for the latter half of the current financial year and the entire second year. State governments will chip in with 40 per cent of the cost. The social cover for gig workers will, of course, be paid for by the businesses running the show, interestingly called aggregators.

But much more relevant is how other such programmes have been delivering in the past. Let’s make a test case of how the rural employment guarantee programme under MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) has been faring. An active monsoon and a robust kharif season have led to an anaemic demand for these low-paid jobs as better-paid farm jobs have become available. Throughout the 2023-24 financial year, the demand for these low-paid jobs kept reducing. Hence, the agriculture sector would appear to be doing fine.

However, independent experts on the programme have a different understanding. They say that there is poor offtake for the low-paid jobs, not because better-paid jobs are available, but because the demand is kept low artificially because of the fund shortage for the programme. When wages are delayed or do not reach beneficiaries on time, they lose interest in the programme. Another allegation, which is quite serious, is that the actual demand is not being met at the panchayat level to keep budgetary outgo within limits.

Bureaucratic systems add to the problem. Technological interventions like Aadhaar card-based attendance systems and GPS tracking of work sites have discouraged workers from seeking employment under this scheme.

So, how do we go from here? How can we ensure that the elderly who seek medical service and the young gig workers get benefits of some of these promises? Besides, what we have seen earlier is that financial resources are not the issue.

A good way to begin is to find out how and why health insurance services are denied and patients sometimes have to go from one hospital to another to find out which one would be willing to admit them. The common complaint on the part of hospitals is that it takes them months to get reimbursements for services delivered under the scheme.

Experts across the country also need to devise a new system that can deliver a modicum of social security to gig workers, for whom it is vital to recover after an illness and get back to work fast.

One way can be to look at how the UK is trying to address the ills of the National Health Service (NHS), considered the grandfather among such national services across the world. The UK Prime Minister has said that the NHS is in a critical condition and warned there will be no fresh funds without reform. Three actions that have been identified are: transition to digital functioning; moving more care from hospitals to communities; and focusing on prevention before people actually need hospitalisation.

In India, too, a new health insurance system has been introduced by Narayana Health Hospitals that needs to be scrutinised by both the government and private entities. Its key features are: the insurance policy is provided by a particular hospital; the focus is on preventive care and treatment; and this works out to cheaper costs and premiums. The crux of the matter is that at the first sign of trouble, you go to the hospital and get treatment. It will benefit both the individual and the insurance firms.