Rethinking Poverty: The Disputed Dividing Line

The co-existence of widespread poverty with high economic growth during the last few years has concerned both policy-makers and academics to get back to what constitutes poverty and where to draw the line below which poverty can be estimated. The concept of poverty line or garibi rekha was introduced by the Planning Commission in the 1960s to identify the poor. It is based on the monetary value required to meet basic needs and is thus revised over the years.1 However, the dividing line is a contested issue and its normative interpretation is difficult. In India the poverty studies based on different approaches to estimate poverty have produced different figures that tell us about the percentage of population below the poverty line.2 The Economic Survey 2008-09 (Indian Budget) states that 710 million are below the poverty line. The Planning Commission’s estimate of poverty for 2004-05 as 27.5 per cent stands disputed.3 The Suresh Tendulkar Committee Report has revised it as 37.2 per cent. While the urban poverty estimate has remained the same as 25.7 per cent, it has changed for rural India from 28.3 per cent to 41.8 per cent. The N.C. Saxena Committee reports 50 per cent of rural population below the poverty line if one takes into account the calorie intake criterion. The Arjun Sengupta Report of National Commission for Enterprises in the Un-organised Sector (NCEUS) on the conditions of work and promotion of livelihood in the unorganised sector from 1993-94 to 2004-05 states that more than 77 per cent are below the poverty line as they spend less than Rs 20 a day on food. (These poverty estimate figures are taken from the respective reports visited online; also see D’Monte 2010, Dreze 2010, Himanshu 2010.)

Surveys and studies conducted all over the country have found large scale exclusion and inclusion errors in the methodology used in the below poverty line (BPL) Census in 1992, 1997 and 2002. This has resulted in further errors in selecting households for certain schemes and programmes of the Ministry of Rural Develop-ment and the State Government. We see increasing exclusion of the poor from the mainstream socio-economic and political development despite implementation of the poverty alleviation programmes, and efforts to make growth inclusive. Poverty is not only pocketed in certain regions but certain sections of society are also the most vulnerable.4 It is important to rethink strategies to cut poverty by half in 2015 as aimed by the Millennium Development Goals (MDG). Therefore, the alternative strategies and methodologies proposed to correct the errors are crucial and need to be worked upon and experimented as the next BPL Census is due to begin.

This paper tries to highlight the debates in some of the major approaches to estimate poverty. It argues that the non-tangible dimensions of deprivation, such as disadvantage, vulnerability, powerlessness, exploitation, marginalisation and alienation are significant in generating and perpetuate poverty for certain sections of society irrespective of the accelerated growth and levels of development. Therefore the structural conditions need to be addressed in the policies and strategies of poverty alleviation.

Approaches to Estimate Poverty

THERE are three major approaches to estimate poverty (UNDP Human Development Report 1997). The first approach is based on the income necessary to acquire a daily consumption of 2400 kilocalories in rural areas and 2100 kilocalories in urban areas as per the 1979 Nutrition Expert Group to Planning Commission (Planning Commission Report 1981).5 The 1992 BPL Census focused on income cut-off at Rs 11,000 per household, below which all were poor. The BPL families were classified into income ranges of Rs 0-4000, Rs 4000-6000, Rs 6000-8500 and Rs 8500-11000. (Mehrotra and Mander, 2009: 38) Though low income is inescapably related to poverty, nutritional requirements depend on the work roles of people in different societies at different points of history. In addition, increasing income levels do not address the intra-household deprivations. The income of the families may rise when children work, but these children are deprived of their rights such as the right to education. The aspects of child poverty which violate child rights need to be measured independently from adult and family poverty and it has to be age- specific as their needs change when they grow and develop. (Spicker, Leguizamon and Gordon 2007: 33)

Therefore the widely accepted norm of income level based on calorie intake to estimate poverty was questioned in the poverty discourse. Besides income and nutrition, the need to consider lack of basic needs such as access to education, shelter, health, sanitation, drinking water and other basic services became important to measure poverty. Thus the second approach goes beyond income deprivation and defines poverty as a condition characterised by severe deprivation of basic human needs, which depends not only on income but also on access to social services. (See also The Copenhagen Declaration of the World Summit for Social Development, 1995) The 1997 BPL Census decided to use the exclusion criteria to exclude the visibly non-poor on the basis of possessing either of the five assets such as ownership of more than two hectares of operational land holding, a pucca house, an annual income of Rs 20,000 or more, ownership of listed consumer durables and farm equipments, and include the rest as poor. (Sundaram 2003: 896) The 2002 BPL Census was score-based ranking of 13 parameters with a scale of 0 to 4. The scoring parameters include size of operational land holding, type of house, availability of clothing, food security, sanitation, ownership of consumer durables, literary status of highest literate, status in labour force, means of livelihood, status of children, type of indebted-ness, reasons for migration and preference of assistance. (Ministry of Rural Development, BPL Census – 2002) On the basis of total score there were sub-categories as very poor, poor, not-so-poor and non-poor.

Despite the significance of the absolute core in poverty such as the need to meet nutritional requirements, to avoid diseases, to be sheltered, to be clothed, to be educated … to live without shame, the prescriptive definition of basic needs, based primarily on the assertions of experts by simply referring to the physical needs of the individual, is debatable. Amartya Sen argues that the ‘absoluteness’ is neither constant over time nor invariant between societies. It is an approach to judge a person’s deprivation in absolute terms. (Sen 1985: 669-76) However, Peter Townsend and David Gordon argue that such an approach makes both relative and absolute poverty indistinguishable from the operational point of view and the same method and criteria can be used to measure both. (Townsend and Gordon 1991: 35-69) While the need to place basic needs within the context of wider freedoms to livelihood is emphasised, the distinction between relative and absolute poverty continues and influences the estimates of poverty.

The third approach defines poverty in terms of failure of basic capabilities as it is always the poor who are trapped in a vicious circle of poverty marked by chronic under-nutrition, poor health, unsanitary conditions, which in turn increases their vulnerability to infectious diseases that hinders their motivation and reduces their capacity to physical work and thus deems them forever in hopeless poverty. (Dreze and Sen 1989: 13-15) The ability or freedom to lead a life of value in terms of what one chooses to do or be is emphasised in the capability approach of Sen. Poverty is the consequence of the inability to generate sufficient resources to meet needs which is to a large extent because of the structural conditions. Women bear a disproportionate burden of poverty as a consequence of the patriarchal structures. People belonging to the lower castes are also mostly the deprived class and are vulnerable to various manifestations of poverty due to the hierarchical and exploitative caste-class structure. Thus structural poverty is associated with powerlessness, exclusion, exploitation, oppression, deprivation, alienation and a loss of dignity which block opportunities for escape from poverty for certain communities, groups or individuals.

Barbara Harriss points out that measuring the poverty line should investigate ‘the regionally specified relations of the poor to the process of production, exchange, as well as biological and social reproduction,… the rationality of choice made by the poor between investment and consumption, the trends in the wage determi-nation, occupational portfolios, household mobility and sequence of reaction to shock’. (Harriss 1992: 16) Thus, poverty refers to economic, social and psychological deprivations that constrain the full realisation of developmental potentiality of an individual and has been recognised as an interlocking condition of asset less, underemploy-ment, low wages and incomes, proneness to disease, illiteracy, gender and economic vulnerabilities, social disadvan-tage and political powerlessness. (Ibid. 28)

Though the narrow equation of poverty with tangible dimensions of deprivation has been questioned in the poverty discourse during the last decade, and non-tangible dimensions of deprivation have also become important to understand poverty, they are not taken into consideration to estimate poverty as measuring them is difficult. In fact, the acceptance of relating poverty to the lack of entitlement has led to an increasing emphasis on rights as a means to ensuring basic needs. The rights-based approach reinforces the pro-poor mandate of the government through major policy changes such as right to employment, education, health, information, and food security is promised in the proposed draft of the National Food Security Bill. Thus the legal obligation of the state to ensure that the rights of its citizens are secured besides its moral obligation to ensure basic needs is a positive intervention towards poverty reduction.

However, one of the greater challenges for policy-makers to guarantee the basic right to livelihood is to address the structural conditions which generate and perpetuate poverty and deprivation in certain regions for certain sections of society. Despite its multidimensional and multifaceted nature which demands multi- pronged and dynamic approaches, the cross- cutting element of poverty is always the structural deprivation and disempowerment of the marginalised and impoverished. Since poverty is the consequential effect of structural inequality and systemic deprivations which produce and reinforce conditions of poverty, the themes and parameters to draw the poverty line should be in accordance with the local conditions and should not be laid down from above. The guidelines for the 2002 BPL Census was to put the ceiling or cap on the number of BPL households in conformity with the official poverty estimates of the Planning Commission. Therefore it had several conceptual flaws and does not reflect the ground reality. Since a particular score can be obtained by different indicators, it is vulnerable to errors. The intensity of deprivation is not taken into account and there is no provision for the participatory verification.

Several studies show that the rural BPL household survey data is often misrepresented, under-represented, vague, manipulated and incorrect. We also see that the urban poor selection during the last two decades is arbitrary due to the contested citizens such as those residing in illegalised and demolished slums, immigrant refugees, migrants, rag-pickers, rickshaw pullers, hawkers, head loaders, con-struction workers, domestic workers, sex workers, homeless, mentally ill, beggars, and so on. Though the Eleventh Plan Working Group on Poverty Elimination Programmes is looking at the aggregation of BPL survey data and is monitoring the progress of poverty elimination, it is important to revise the criteria for identifying the poor.

Identifying the Poor

THE recommendations on the revision of the poverty line by the ‘Committee of Experts Group to Review the Methodology for the Estimation of Poverty’ under the chairmanship of Suresh Tendulkar are a major step to correct some of the errors. The Tendulkar Committee has recommended abandoning of the calorie-norm for estimating the poverty line and instead the same standard of living that defines urban poverty is to be applied for mapping rural poverty as well. It is based on the income required to purchase a standardised consumption basket of minimal needs which ‘includes access to nourishment, shelter, clothing, education, protection from disease and ability to be mobile so as to have minimal social interaction’. (Tendulkar 2009) Therefore the effort to obtain Purchasing Power Parity (PPP) of the all-India poverty line across States, rural and urban areas is an important recommendation as the price indices would include the current consump-tion pattern. The PPP has re-estimated poverty lines at Rs 446.68 for rural and Rs 578.80 for urban areas per capita per month. (Ramakumar 2010:10) However, despite standardised spatial price indices, it is important to rethink if a certain cut-off to count the poor can also be taken as the norm to decide the beneficiaries of poverty alleviation and other welfare pro-grammes. (Reddy 2009: 5) The revised poverty estimates appear more realistic, but the Tendulkar report once again reopens the debates on methodology to measure poverty and the errors of inclusion and exclusion in the BPL list.

The Saxena Committee takes five indicators instead of 13 essentially focusing on community, land ownership, occupation, education and old age or illness with an aggregate score ranging from 0 to 10. It also recommends a new metho-dology of score based ranking besides parameters of ‘automatic inclusion’ and ‘automatic exclusion’. (Saxena 2009) While families belonging to the SCs, STs, landless, single women as head and minorities could be included, families with double the land of the district average of agricultural land could be excluded. (Ibid.)

In fact, Santosh Mehrotra and Harsh Mander point out that most of the 13 criteria for identifying BPL households in 2002 did not take certain essential considerations into account such as the quality of land owned, possession of the pucca house due to Indira Awas Yojna (IAY), different climatic conditions while counting the pairs of clothes, food security in terms of its nutritional contents and so on. (Mehrotra and Mander, 2009: 38-40) They make some important suggestions to avoid the errors in identifying the poor such as (i) not to make the score for each dimension public; (ii) the scores should be automatically generated by the computer programme and the enumerator should have no information about it; (iii) the cut off for each programme should vary as per the objective of the programme and the resources available with the State and Central governments; (iv) the methods adopted to identify the rural and urban poor should be easily verifiable, directly observable and transparent; (v) the survey in rural areas must include the homeless, out migrants, landless or near landless artisans and people depending mostly on forest for food (vi) it must exclude households with two standard hectares of land, four-wheeled vehicles, running bore well, annual income of Rs 10,000 or more and income-tax payers; (vii) the BPL list should be approved by the village gram sabha, subject to corrections after the lodging of complaints; (viii) the criteria for identifying the urban poor should include the socially vulnerable such as child-headed households, single women and single-women headed households, disabled people, old people, occupational categories such as rag-pickers, casual daily wage workers, rickshaw pullers, porters, construction workers, street vendors, hawkers, domestic helps, shelterless, dwellers of unauthorised slums and direct allottees of resettlement colonies. (Ibid. 40-44)

Participatory verification and transparency is also suggested by Jean Dreze and Reetika Khera who point out that estimating poverty can be seen as a particular case of identifying a “social assistance base†or SAB list, which is self-generated based on the exclusion and inclusion criteria rather than determined by top-down caps as in the BPL surveys. (Dreze and Khera, 2010: 54-63) The “baseline exclusion criteria†is based on the ownership of durable assets such as cars, refrigerators, landline telephones, scooters, coloured televisions and composite asset amenities such as having electricity, piped water and a flush toilet. (Ibid. 56) Dreze and Khera formulate four sets of exclusion criteria on the basis of the ownership of any of the baseline assets, alongside ownership of a pucca house or multi-room pucca house or three acres of irrigated–equivalent land. (Ibid.) The inclusion criteria should be verifiable such as households belonging to the SCs or STs, landless, where no adult member is educated beyond class V, single Women headed households and where at least one adult member is working as an agricultural labour. (Ibid. 58)

While the inclusion and exclusion criteria suggested focus on resources and not on capabilities (Alkire and Seth 2008 cited in Meherotra and Mander 2009), the latter play a vital role in determining the vulnerability to poverty and if at all one can escape the poverty trap. The structural conditions hinder the capabilities of certain sections leading to their marginalisation, exclusion, deprivation and alienation. They not only lose their productive resources and assets but also control over their labour power and therefore the produce of their labour. Thus over a period of time, the impoverished get trapped in the vicious circle of poverty.

Conclusion

THE poverty alleviation programmes should be more than mere relief measures. An accelerated growth can be sustainable in the long run only if socio-economic and political development takes place at the grassroots in accordance with the demands and needs of the local people. State policies should prioritise entitlement and control over productive resources which to a large extent determine relations of production and exchange, that are often unequal, exploitative and oppressive. The social upper caste largely converges with the economically powerful class, and they play a significant role in alienating the lower caste from the productive resources, labour power and produce of their labour. It is distress sale of labour, which make particular sections of the society vulnerable to impoverish-ment and marginalisation.

Inclusive growth can be possible when people’s organisations and institutions, which provide space to the poor and the excluded, are encouraged to play an important role in decision and policy-making. (Mohanty 2003: 202-203) Planning from below will make a difference. Thus alongside the new methodology to identify the poor, rethinking poverty leads us to rework alternative strategies which should aim at structural changes to arrest the process of exploitation, oppression, deprivation and marginalisation to ensure the right to livelihood and freedom from poverty.

REFERENCES

D’Monte, Darryl (2010), “Counting the Poor, Courting their Votes†in India Together April 30, visited online edition on October 5, 2010.

Dev, Mahendra and Ajit Ranade (1997), “Poverty and Public Policy: A Mixed Record†in India Development Report by K.S. Parikh, New Delhi: Oxford University Press.

Dreze, Jean (2010), “Poverty Estimate Vs Food Entitlements†in The Hindu February 24, visited online edition on October 4, 2010. Also see Ministry of Rural Development, BPL Census—2002 at rural.nic.in/Presentation/Pres_ BPL.ppt.

Dreze, Jean and Reetika Khera (2010), “The BPL Census and a Possible Alternative†in Economic and Political Weekly, (45) 9.

Dreze, Jean and Amartya Sen (1989), Hunger and Public Action, Oxford: Clarendon Press.

Haub, Carl and O.P. Sharma (2010), “What is Poverty, Really? The Case of India†in Population Reference Bureau visited online on October 5, 2010 at http://www.prb.org/articles/2010/indiapoverty.aspx

Harriss, Barbara (1992), ‘Rural Poverty in India: Micro Level Evidence†in Poverty in India: Research and Policy by Barbara Harriss, S.Guhan and R.H.Chossin (eds.), Oxford: Oxford University Press.

Himanshu (2010), “Demystifying Poverty: Which Estimate and Why†in The Wall Street Journal, January 19, visited online on October 4, 2010 at livemint.com

Manoranjan, Mohanty (2003), “Poverty Eradication and Role of Local Institutions in Comparative Perspective: With Focus on Kalahandi, Bhojpur and Chittoor†Project Report submitted to the Planning Commission, Government of India by Manoranjan Mohanty, S.K. Aggarwal, G.N. Trivedi, Suranjita Ray and N. Sukumar.

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Patnaik, Utsa (2010), “Trends in Urban Poverty Under Economic Reforms 1993-94 to 2004-05†in Economic and Political Weekly, (40) 4.

Patnaik, Prabhat (2010), “A Left Approach to Development†in Economic and Political Weekly, (45) 30.

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Ramakumar, R. (2010), “The Unsettled Debate on Indian Poverty†in The Hindu, January 2.

Reddy, C. Rammanohar (2009), “Recounting India’s Poor†in Economic and Political Weekly, (44) 51.

Saxena, N.C. (2009), “The Moving Bar of Poverty Statistics†in Business World September 25, visited online on October 5, 2010.

Sen, Amartya (1985), “A Sociological Approach to the Measurement of Poverty: A Reply to Prof. Peter Townsend†, Oxford Economic Papers 37, cited in Poverty an International Glossary by Paul Spicker, Sonia Alvarez Leguizamon and David Gordon (eds.) (2007), London and New York: Zed Books.

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FOOTNOTE

1. Keeping the changes in the consumer price indices, the Planning Commission revised the minimum expenditure of 1973-74 from Rs 49.89 for rural areas and Rs 56.69 for urban areas (Dev and Ranade 1997:27) to Rs 356.30 and Rs 538.60 respectively for the required consumption of 2400 kilo-calories and 2100 kilo-calories per person per day (61st round of National Sample Survey Organisation 2004-05). The Tendulkar Committee revised it as Rs 446.68 and Rs 578.80 respectively. The Arjun Sengupta Committee Report states that if 2400 kilo-calories is taken into consideration, 80 per cent of the rural population are below the poverty line, and even for 2100 kilo-calories the consumption expenditure should be revised to Rs 700 in rural areas and Rs 1000 in urban areas (Haub and Sharma 2010).

2. The World Bank estimates that a third of the world’s population reside in India i.e 41.5 per cent (488 million) have less the $ 1.25 Purchasing Power Parity (PPP) per day and 75.6 per cent (887million) have less than $ 2.00 PPP per day (Haub and Sharma 2010).

3. The decline in poverty estimate by Planning Commission from 51 per cent in 1977-78 to 36 per cent in 1993-94 and 27.5 per cent in 2004-05 is debated. The comparison is not valid since the norms used to estimate poverty has been changing over the years. On the contrary Utsa Patnaik points out that the proportion of rural population having less than 2400 calories per person per day increased from 74.5 per cent to 87 per cent between 1993-94 and 2004-05. (U. Patnaik 2010: 42) Similarly the proportion of urban poverty also increased from 57 to 64 per cent during the same period (P. Patnaik 2010: 33).

4. A study by the Oxford Poverty and Human Development Initiative using a Multi-dimensional Poverty Index (MPI) shows that 421 million poor live under MPI in eight States of India such as Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh and West Bengal. This is higher than 410 million poor living in 26 poorest African Nations. (The Times of India, July 12, 2010)

5. The UN World Food Programme questions the definition of poverty based on calorie consumption. The official estimates of the Planning Commission shows that poverty in rural India declined rapidly during a period which also shows the increase in calorie deprivation as India ranks 94th in the Global Hunger Index. (The Times of India, February 27, 2009) This highlights the increasing disconnect between poverty estimates and calorie consumption. (Poverty in India 2010) Even in the Human Development Index India’s rank has further lowered from 122 in 1992 to 132 in 2007-08. (Ibid.)

Suranjita Ray teaches Political Science at Daulat Ram College, University of Delhi. She can be contacted at suranjitaray66@yahoo.co.in