Freebies, a threat to Healthy Polity and Economy
It has to be understood that this politics of freebies is inauspicious for both the economy and the administration; and the same needs to be stopped by consensus. — Dr. Ashwani Mahajan
To speak against distribution of freebies, of course, will attract the wrath of those who benefit from them. That is, if we say that electricity, water, travel should not be made free or that television sets or other types of temptations by political parties are wrong and they should end, then it is possible that people unaware of the possible consequences of announcements of such freebies may not like it . After independence, the emphasis has generally been on development, poverty alleviation, better social services, drinking water, road, rail etc. But now some political parties have started making promises to provide free electricity, free water, free transport, free television sets and even mangalsutra, in spite of the poor economic condition of the governments. Result of such freebies is that states are coming under huge debts and the quality of public services is the major victim.
Significantly, Delhi is a prosperous region of the country. The per capita income here is second highest in the country, after Goa. Due to this, the revenue of Delhi is also very high. A large number of migrants also live in Delhi, who have migrated from other states in search of employment. Their economic condition is not so good, which can be gauged from the fact that a large number of people had to leave for their villages, as soon as the lockdown was imposed due to the pandemic. The sights of a large number of migrants going on foot, on bicycle or in buses with just one bag still haunts us. Most of the migrant laborers are daily wage earners, or engaged in micro businesses. A large number of them live in most horrible condition, where even basic facilities are lacking. In such a situation, there is usually no question of their families joining them.
The number of such migrant laborers in Delhi is not less than 50 lakhs. The laborers who bring their families with them are living in a very pathetic condition in Delhi. Schools, colleges and other educational institutions are needed for them and their families. At the same time there is also a need for better sewerage system and good health facilities in large numbers. Roads, flyovers etc. are also needed for their movements. But all these works require huge expenditure. It is seen that due to lack of funds, the Arvind Kejriwal’s Aam Aadmi Party (AAP) government in Delhi is not able to provide budget for development and maintenance.
After assuming power by Chief Minister Kejriwal in 2015, till date the Delhi government has not been able to build any new school, college, hospital, flyover etc. In such a situation, the plight of the poor can be easily imagined. The roads, water and sewage system are also not being taken care of properly. Lack of finances is the main reason for this. It is not that the revenue of Delhi is deficient. The fact is that the per capita revenue in Delhi is much higher than the rest of India and is increasing continuously. The total revenue of Delhi for 2021-22 is estimated at Rs 53070 crore, which is 3 percent of the revenue of all the states. In 2019-20 it was Rs 47136 crore and in 2014-15, it was only Rs 29584 crore.
Ever Rising Freebies
But along with this increasing revenue, the expenditure on free electricity, water, transport of the Delhi government is increasing more than proportionately. The expenditure on free electricity was Rs 1639 crore in the year 2015-16, which increased to Rs. 2968 crore in the year 2021-22. Power Department has demanded Rs 3200 crore from the Delhi government for this power subsidy for the year 2022-23. That is, it can be understood that the burden on the budget is increasing in the name of making electricity free by the Delhi government and it has almost doubled between 2015-16 and 2022-23. By huge spending on free electricity, water and transport, there is always a shortage of funds for essential civic amenities.
As a result of the exercise of Delhi Government towards reducing water bills to zero, both the deficit and debt of the Delhi Jal Board are mounting. In the first three years of the Kejriwal government, the loss of Delhi Jal Board tripled from 220.19 crores in 2015-16 to 663 crores in 2018-19. According to the CAG report, in 1998-99, where Rs 26620 crore was lent to the Delhi Jal Board, out of which only Rs 351 crore was returned and till March 31, 2018, Rs 26269 crore was outstanding. Meanwhile, Delhi government has given Rs 41000 crore as loan to Delhi Jal Board in the last 5 years. The deteriorating condition of Delhi Jal Board can be gauged from the slow pace of its development works and poor water system. It is believed that the financial condition of the Delhi Jal Board has become very bad due to the Delhi Jal Board being under the Delhi government and the exercise of making water free. Slow pace in water connection in unregulated colonies by Delhi Jal Board and poor condition of sewer system is primarily because of poor financial health of Delhi Jal Board. The opposition parties, have also been making allegations of alleged corruption in Delhi Jal Board.
Apart from this, free travel for women in Delhi Transport Corporation buses is yet another freebies scheme run by the Delhi government. Thousands of crores of rupees are lost by the government through freebies schemes. It is natural that due to the limited resources, this freebies policy puts pressure on the government finances and many essential expenditures are sacrificed to pave way for freebies.
At present, the Aam Aadmi Party, which is in power, promised in its election manifesto in the year 2015, about opening of 20 new colleges in Delhi, providing free Wi-Fi, building 20000 public toilets, constitute women's security force, installation of 3 lakh CCTV cameras, expansion of health facilities, among others. There were 69 such promises including creation of 8 lakh jobs, skill training of one lakh youth every year by Delhi Skill Mission which either remained mere promises or in which progress was very slow. It may be noted that prior to AAP government, 15 years between 1999-2000 and 2014-15, growth in capital expenditure was 19.6 percent per annum (increase from Rs 510.5 crores to Rs 7430 crores), which declined to hardly 9.2 percent in the first 5 years of AAP government (increase from Rs 7430 crores to hardly Rs 11549 crores). It can be easily understood that the main reason behind stalling of Delhi’s development was lack of resources, as more and more resources are being used for giving freebies.
If it is said that these freebies schemes are targeted at poor, then it will not be right. In the year 2021-22, in Delhi, where per capita income at current prices was Rs 4,01,982 per year, out of 54.5 lakh electricity consumers, 43.2 lakh people are being provided electricity either free of cost or at half price. A big chunk of those, who can easily pay for electricity, are also being given electric free. The facilities are being badly affected and the debt on the government is increasing, so it cannot be said to be justified. Not only this, 20 thousand liters of water per month is also being provided free of cost to 5.3 lakh households. For this reason, worsening condition of Delhi Jal Board is also no secret. due to the provision of free water.
AAP, which took political gains from these schemes of free electricity, water in Delhi, has now started extending the same in other states as well. This political party is trying to justify free electricity and water after the Supreme Court put a question mark on such schemes. It has to be understood that this politics of freebies is inauspicious for both the economy and the administration; and the same needs to be stopped by consensus.
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