| PYQ Relevance: Q) Reforming the government delivery system through the Direct Benefit Transfer Scheme is a progressive step, but it has its limitations too. Comment. (UPSC CSE 2022) |
Mentor’s Comment: UPSC Mains have focused on the ‘cash transfer system for the welfare schemes to minimize corruption, eliminate wastage and facilitate reforms (in 2013), and ‘Direct Benefit Transfer Scheme is a progressive step’ (in 2022).
In the Maharashtra and Jharkhand Assembly elections, cash transfer schemes for women became a key focus of political campaigns. In August, the Maharashtra government launched the ‘Mukhyamantri Majhi Ladki Bahin Yojana,’ giving ₹1,500 a month to eligible women in their Aadhaar-linked bank accounts. Similarly, the Jharkhand government introduced the ‘Jharkhand Mukhyamantri Maiya Samman Yojana,’ offering ₹1,000 a month to eligible women.
Today’s editorial highlights why are cash transfer schemes for women gaining popularity across states? Is this a case of policy learning, or are state governments simply following the trend out of fear of missing out? Are we reaching a stage where there is no alternative approach to welfare?
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Let’s learn!
Why in the News?
Direct cash transfer schemes are not a new idea in politics. According to Axis Bank, 14 states in India already have such programs, reaching nearly one-fifth of the country’s adult women.
What are the reasons for the growing popularity of Cash Transfer Schemes?
- Increased Voter Turnout: The turnout of women voters has significantly risen from 47% in 1962 to 66% in 2024, indicating a growing political engagement among women.
- This trend is mirrored in state assembly elections, highlighting women’s increasing influence in the electoral process.
- Direct Benefit Transfer (DBT) Efficiency: Cash transfer schemes, particularly through DBT, allow governments to bypass traditional bureaucratic structures that often involve middlemen. This method reduces corruption and ensures that funds reach beneficiaries directly, making these schemes more appealing for political leaders who want to demonstrate effective governance.
- Immediate Political Gains: Cash transfers provide a quick and visible form of assistance that can be implemented rapidly compared to longer-term infrastructure projects or social services. This immediacy allows governments to showcase their commitment to welfare, thereby enhancing their political capital in the short term.
- Standardization of Welfare Approaches: The proliferation of similar cash transfer schemes across states indicates a trend towards standardization in welfare policies, often referred to as “policy learning.”
- Fear of Missing Out (FOMO): As some states successfully implement these schemes and gain political traction, others may feel compelled to adopt similar measures to avoid losing electoral support.
- Addressing Structural Inequalities: Cash transfer schemes are often designed to address gender-specific issues such as female foeticide, child marriage, and educational disparities.
What are the significance of bypassing the Middleman?
- Direct Benefit Transfer (DBT) Advantage: DBT allows governments to transfer cash directly to beneficiaries’ bank accounts, thus minimizing corruption and inefficiencies associated with traditional welfare distribution methods that often involve middlemen.
- Reduction of Corruption: By eliminating intermediaries, DBT aims to reduce systemic corruption that has historically plagued welfare schemes in India, ensuring that funds reach intended recipients more effectively.
- Personalized Political Relationships: Cash transfers help establish a direct relationship between political leaders and citizens, fostering personal loyalty through financial assistance. This dynamic is referred to as “techno-patrimonial,” where technology enhances individual connections with leaders.
- Immediate Impact: Cash transfers provide immediate financial relief to beneficiaries, allowing governments to demonstrate their commitment to welfare without the long-term planning required for infrastructure projects or social services.
What are the key challenges?
- Lack of Welfare Innovation: The proliferation of similar cash transfer schemes across various states indicates a stagnation in innovative welfare policies. This trend suggests a reliance on established models rather than exploring diverse approaches to address poverty and welfare needs.
- Political Conformity: Even opposition-ruled states are adopting cash transfer schemes similar to those initiated by ruling parties, reflecting a broader acceptance of this welfare strategy without offering substantial alternatives.
- Efficiency vs. State Capacity: While cash transfers may enhance efficiency in delivering aid, critics argue that they allow the state to avoid addressing deeper structural issues within its capacity to provide comprehensive welfare services.
- Temporary Solutions: Cash transfers are seen as short-term solutions (or “bandages”) for poverty alleviation, potentially nudging citizens toward private alternatives for basic needs while failing to address systemic issues that require more robust state intervention.
Way forward:
- Innovate and Diversify Welfare Strategies: Encourage states to develop innovative welfare policies beyond cash transfers, focusing on long-term solutions like skill development, education, and healthcare to address systemic poverty.
- Strengthen State Capacity: Invest in enhancing the state’s institutional framework to deliver comprehensive welfare services efficiently, ensuring sustainable development and reducing reliance on temporary solutions.
