Populist schemes: Bribing voters with tax payers’ money

The announcement of welfare schemes at the time of elections to attract voters is not a new phenomenon in the Telugu states.

Hyderabad: The other day, I happened to read an interesting anecdote. A flock of sheep was performing “ksheerabhishekham” (milk bath) for the portrait of the king of the country and raising slogans praising him.

An old sheep asked them the reason for their jubilation. They replied: “Our king has announced that he would provide woollen sweaters to each of us this winter, so as to protect us from cold. He was so magnanimous and we are deeply indebted to him for his gesture.”

The old sheep asked them: “Do you know where does the king get the wool from to make sweaters?” They said they were not aware. “Poor fellows. He collects wool from your bodies and wants to make sweaters. In order to silence you, he is offering you sweaters made of your own wool free of cost.” 

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I remembered this anecdote, when I noticed the pictures in the newspaper of several Dalit youths from Vasalamarri village of Yadadri Bhongir district performing “milk bath” to the portraits of Telangana Chief Minister K Chandrasekhar Rao for announcing the launch of Dalit Bandhu scheme.

The scheme, considered to be the biggest cash transfer scheme ever launched in the country, envisages payment of Rs 10 lakh to each eligible Dalit beneficiary for his economic uplift. In the state annual budget, the TRS government earmarked Rs 1,000 crore for the CM Empowerment of Dalits scheme.

The budgetary provision shot up to Rs 1200 crore, when the chief minister discussed the modalities of the scheme at an all-party meeting and declared that 100 families in each of 119 assembly constituencies would be provided financial assistance.

But KCR soon realised that the scheme is not as simple as he believed it to be and it would be counterproductive for the TRS if the scheme is confined to just 100 Dalits in each assembly constituency. So, he was forced to announce that Dalit Bandhu scheme would be applicable to all the eligible Dalits and his government would be willing to spend Rs 80,000 crore to Rs 1 lakh crore on it.

“Dalit Bandhu is a free scheme and the amount given to the beneficiaries is not a loan. There is no need to repay the amount which would be deposited directly into the bank accounts of the beneficiaries,” KCR said.

According to official estimates, there are around 17 lakh Dalit families in the state, of whom 12 lakh families would be eligible to get Dalit Bandhu scheme.  If each family has to be given Rs 10 lakh, it requires Rs 1.2 lakh crore for the scheme. In Huzurabad assembly constituency, which is going for by-election shortly, there are around 21,000 Dalit families eligible for the scheme. 

Where does this Rs 1 lakh crore come from? Obviously not from the pockets of politicians, but it has to be spent from the tax payers’ money. Even if the government has to go in for borrowings from financial institutions to fund the scheme, the loan and the interest thereon have to be borne by the tax payer again.

Not just Dalit Bandhu, for that matter any other welfare scheme taken by the ruling parties as part of their vote-bank politics, has to be implemented only with the people’s money.

No doubt, ours is a welfare state, as per the Constitution of India, but our political parties have virtually made the people beggars, by throwing lollipops at them in the name of welfare schemes. They have simply ignored the fact that the welfare schemes are meant for making the people stand on their own feet, and not lazy bugs, waiting for the baits thrown at them to grab their votes.

Unfortunately, the people, too, have been habituated to falling for these freebies, instead of seeking long-term growth plans and capacity building from the government.

Not a new phenomenon 

The announcement of welfare schemes at the time of elections to attract voters is not a new phenomenon in the Telugu states. It began with film star-turned-politician N T Rama Rao announcing Rs 2 a kg rice scheme when he launched Telugu Desam Party in 1982 elections and it catapulted him to power within nine months. Though the then Congress government led by Kotla Vijayabhaskar Reddy also launched Rs 1.90 a kg rice scheme before the 1982 elections, it was too late by then.

Subsequently, every political party has begun appeasing voters with freebies such as fee reimbursement scheme, free power supply for agriculture, crop loan waiver, 25 paise interest (pavala vaddi) etc. As such schemes fetched them votes in the elections, they have become the order of the day.

In a way, subsidies for food grains, agriculture inputs and electricity, besides education and healthcare are understandable to some extent in the Indian context, but it was disgusting to see political parties competing with one another in offering everything free to the people to attract their votes.

Take the case of crop loan waiver. It was envisaged to prevent growing number of suicides by farmers due to crop failures on account of natural calamities. But it has become a regular practice for the parties to come up with crop loan waiver promise. If one political party announces crop loan waiver up to Rs 1 lakh, another party is promising to raise the cap to Rs 2 lakh, which has resulted in draining of state exchequer. This has virtually crippled the banking system.

The free power supply introduced by Y S Rajasekhar Reddy in 2004 has, no doubt, provided a big relief to the farm sector which was facing the burden of high power tariff in the post-reforms era, but it has now become a permanent feature in both the Telugu states. In fact, Andhra Pradesh Chief Minister Y S Jagan Mohan Reddy government declared that there would no power charges on agriculture sector for another 30 years. Needless to say, he wants to be in power for such a long period.

The Rythu Bandhu scheme introduced by the TRS in May 2018, seeking to provide Rs 4,000 per acre per season to each farmer, irrespective of the size of the landholding, fetched massive political dividends to the TRS in the December 2018 assembly elections in the state and brought him back to power for a second successive term. Now, many states and even the Narendra Modi government came out with similar schemes to attract voters.

With every election, the political parties have been coming out with more and more such freebies – whether it is unemployment allowance to the jobless youth or construction of double-bed room housing units or free mobile phones to every household with one year free recharge facility or provision of bicycles to girl students, enhancement of pensions for the old and the disabled, or distribution of sarees to womenfolk during festivals or payment of cash incentives of over a lakh of rupees to the newly married couples.

Drain on exchequer

Many economists argue that while subsidies to a reasonable extent are essential to enhance the productivity, freebies are against the fiscal prudence and would ruin the country’s economy in the long run.

There is an argument that instead of providing direct cash to farmers in the name of Rythu Bandhu or PM-Kisan, the governments could take measures such as extension of more agriculture finance to them at lesser interest rate, supply of seeds, fertilisers and pesticides at highly subsidized rates, provision of scientific agriculture extension to enable increase of productivity and finally, ensuring remunerative prices for the crops by removing middlemen in the procurement process.

Unfortunately, the political leaders are more interested in getting quick returns in elections and so are the people who want quick benefits. So, a galore of freebies continue during the elections.

A Srinivasa Rao is Senior Journalist based out of Hyderabad covering developments in Andhra Pradesh and Telangana. He has over three decades of reporting experience.

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