In a contentious report released on Tuesday, the Planning Commission (PC) has claimed that the proportion of those living below poverty line during the seven years of the UPA has come down from 37.2 per cent in 2004-05 to 21.9 per cent in 2011-12. This works out to an average annual decline of 2.18 per cent. The conclusion is based on analysis of the household surveys conducted by the National Sample Survey Organisation. Ironically, the commission has adopted a methodology that it had itself discarded as outdated a year ago to arrive at its findings. It has used the Suresh Tendulkar formula for fixing the poverty line that had drawn flak from economists as well as the Supreme Court during its last similar exercise.
This is nothing short of contrived statistical jugglery and the timing of the release of the report raises serious questions about the commission’s intent. The presumption that anyone who spends more than Rs 27.2 per day in villages and Rs 33.3 in cities per day is above poverty line is absurd in the face of steep rise in the prices of essential commodities. The government had appointed a committee under prime minister’s chief economic adviser C Rangarajan to suggest a better methodology than the earlier one. The PC should have waited for its report before undertaking yet another exercise in futility just for the political expediency of the ruling party ahead of general elections due next year.
The report also contradicts the basic premise of UPA’s flagship food security law meant to feed India’s 60 crore poor. Unfortunately, the PC is dominated by free market economists, who are destroying the credibility of the system for political and corporate benefits. It is time that the government restructured the commission and evolved an independent and credible mechanism for providing critical data that can form the basis for our planning and policy making process. Coloured or motivated data and analysis will always lead to distorted policies and programmes and India can ill-afford it.