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LATEST NEWS UPDATES | Planning Commission may lower poverty estimates by Sangeeta Singh & Nikhil Kanekal

Planning Commission may lower poverty estimates by Sangeeta Singh & Nikhil Kanekal

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published Published on Apr 21, 2011   modified Modified on Apr 21, 2011

India’s apex planning body may cap national poverty at 32% for the purpose of calculating welfare benefits in the 12th Five-year Plan that starts on 1 April 2012, it said a day before a meeting with Prime Minister Manmohan Singh.

The development comes on a day the Supreme Court asked Montek Singh Ahluwalia to respond why it should not strike down an earlier cap of 36% poverty after the government sought more time to address the issue on Wednesday. Ahluwalia has a week to respond.

The latest 32% cap is 5.2 percentage points lower than what a report by an expert group headed by Suresh Tendulkar, a former chairman of the National Statistical Commission, had submitted to the Commission in 2009.

The 37.2% cap has been proposed to be the basis of the draft legislation on food security.

“Planning Commission member Abhijit Sen recently worked out a poverty estimate of 32% pertaining to 2009-10,” Ahluwalia told reporters on Wednesday. “Personally, I feel this estimate is quite accurate. The Planning Commission will work out in detail whether this estimate is correct and then decide.”

“If the estimates worked out by Sen are found to be correct, we will use poverty figures so estimated to finalize poverty alleviation programmes in the 12th Plan,” minister of state for planning and parliamentary affairs Ashwani Kumar said.

Several state governments have contested in affidavits to the apex court on the Central government’s poverty estimates and have asked New Delhi to release more food grain for distribution to poor families.

The Union government till recently determined the level of poverty on the basis of daily per capita spending of Rs.12 in rural areas and Rs.17 in urban areas.

The Supreme Court had questioned the Commission’s logic on how it had arrived at a cap on poverty, Mint reported on 30 March.

“We fail to understand the rationale and justification for the cap fixed by the Planning Commission,” the Supreme Court had said.

According to Sen, while rural poverty is lower by 5-5.5 percentage points, urban poverty has declined by 4-4.5 percentage points than what was estimated by the Tendulkar report.

According to the Tendulkar report, estimates for poverty in 2004-05 were 41.8% in rural areas, 25.7% in urban areas and 37.2% overall.

Abhijit Sen said the National Sample Survey Organisation is expected to publish its 2009-10 survey, based on which the Commission will come out with new poverty figures.

“That will also make the picture clearer as to how close are we in estimating poverty figures,” Sen said.

Sen said the data for 2009-10 has been arrived at using the Tendulkar methodology and adjusting it for inflation. “I wouldn’t say it is in full conformity with the methodology suggested by the report, as some required data were not available; but it’s a near approximate,” he added.

The planning body will make a brief presentation to Prime Minister Singh on the 12th Plan on Thursday. Ahluwalia said the presentation will largely rest on a projected growth of the economy at 9-9.5% and a farm sector growth of 4%.

According to Pronab Sen, principal advisor to the Commission, who has been associated with the making of the approach paper, consultation with states on the 12th Plan will start once Singh gives the go-ahead.

The approach paper is expected to be ready in a month’s time, which will be followed by a National Development Council (NDC) meeting comprising state chief ministers, cabinet ministers and senior bureaucrats.

Once approved by NDC, the Plan documents and sectoral outlays for the 12th Plan will be made.

Live Mint, 21 April, 2011, http://www.livemint.com/2011/04/20221731/Planning-Commission-may-lower.html?atype=tp


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