Budget 2021: 137 per cent hike for healthcare, but experts say read fine print

NEW DELHI: Union Finance Minister Nirmala Sitharaman on Monday announced a hike of 137 per cent in the health budget for the coming fiscal as compared to the last year, but a closer look at the allocation shows that the increase in the budget for core areas is just about 9 per cent.

If the revised estimate of Rs 82,445 crore for the Union Ministry of Health and Family Welfare for last year is taken into account, the proposed budget of Rs 73,932 crore for the ministry is actually lesser by 11.5 per cent, even as the battle with Covid-19 pandemic continues.

The budget proposals for 2021-2022 rest on six pillars, said Sitharaman, naming health and well-being ahead of five others. But the allocation in the sector did not reflect that sentiment even in a pandemic year, felt many public health experts and health economists.

“I have provided Rs 35,000 crore for Covid-19 vaccine in this year 2021-22. I am committed to providing further funds if required. So, the budget outlay for health and well-being is Rs 2,23,846 crore in 2021-22 as against only Rs 94,452 crore in 2020-21 and it marks an increase of 137 per cent,” said Sitharaman in her speech.

An analysis of the proposed outlay, however, reveals that of about Rs 2.24 lakh crore shown as proposed expenditure towards health, while over Rs 60,000 crore is for the department of drinking water and sanitation, Rs 35,000 crore is for Covid-19 vaccination — a one-time activity.

Other significant spendings — to the tune of Rs 49,000 crore — are Finance Commission grants for health and water and sanitation, which will again be a one-time allocation. Some experts did not mince words in saying that they were disappointed with the budget proposed for health. 

“If this is how the government treats it in a pandemic year, then I do not know how does it take its own promise of spending 2.5% of the GDP on health by 2025, which is looking almost an unachievable target given the trend,” a public health specialist, on condition of anonymity, said. 

Health researcher Oommen John said: “After discounting for the vaccination campaign allocation, there needs to be targeted financing of strengthening primary care, diagnostics and continuum of care.”

He added: “As strategic purchasing of health services is not a long-term solution, health systems strengthening is critical, trust appropriate allocations for the same has been considered.”