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Budget 2019: Behind Chest Thumping, Cuts in Welfare and Silence on Jobs

Subodh Varma |
The Interim Budget granted a paltry Rs 500 per month to farmers as relief, fund cuts for dalits, adivasis and minorities, and was silent on agricultural and industrial workers.
Cuts in Welfare and Silence on Jobs

It was the theatre of absurd in the Lok Sabha on Friday as replacement Finance Minister Piyush Goyal presented the Interim Budget through an election speech, tom-tomming the so-called achievements of the Narendra Modi government over the past five years, offering an insulting Rs.500 per month as “relief” for small and marginal farmers, blithely skimming over the raging crisis of unemployment and heralding a 10-dimensional vision for the coming decade. All the while, BJP MPs could be seen energetically thumping their desks and calling out “Wah! Wah” (kudos) as if they were attending a kavi sammelan (poetry session).

What the Budget papers reveal, however, is an unmitigated attack on a range of welfare schemes, especially those directed at dalits, adivasis, minorities, and a general slashing of funds for state supported provision of education and healthcare. Instead, funds were made readily available for the discredited Ayushman Bharat type of insurance schemes, although even those are far from what was claimed.

Hot Air for Farmers & Unorganised Sector Workers

The big-ticket announcement of Rs.500 per month “income supplement” for farmers having less than two hectares land will imply an expenditure of at least Rs.75,000 crore because as per the latest 2015-16 Agricultural Census, there are about 12.56 crore such farmers in the country, making up 86% of all farmers. The Budget documents give no clue about where this huge amount is going to come from. But that is typical of the Modi government – make the declaration and worry about the implementation later. Such was the desperation that Rs.20,000 crore was injected into the current year’s revised estimate with just two months to go before the financial year ends. This hare-brained scheme is unlikely to help Modi and his party, the BJP, in the elections because it doesn’t give much to the suffering farmer, and its implementation is fraught with uncertainty because land titles will need to be checked, lists made and so on.

The case of the other big scheme – pension for unorganised sector workers – is even worse. Just Rs.500 crore have been allocated for this scheme which won’t even begin to cover a fraction of the estimated 40 crore workers. At Rs.3,000 per month, the monthly bill itself would be Rs. 1.2 lakh crore. It’s a cruel joke.

Flagship Schemes

The rural jobs guarantee scheme (MGNREGS) was allocated just Rs.60,000 crore, compared with Rs.61,084 crore spent in the current year. This cut is not understandable because in the current year, spending had shot up by over Rs.6,000 crore over the Budget allocation. Yet the government continues to cut funds for the only scheme that provides some relief to people suffering the twin blows of unemployment and farm crisis. Similarly, the social assistance programme (NSAP) which includes old age and widow pensions, suffered a cut from previous year. (See Table below)


The government’s pet programme of rural housing, Pradhan Mantri Awas Yojana (PMAY), suffered a cut of Rs.2,000 crore over the previous Budget estimate while in the other much lauded rural roads programme (PMGSY), last year’s allocation could not even be fully spent – some Rs.2,500 crore was reported as unspent – and the level was maintained at the current year’s Budget estimate.

SC, ST and Minorities

The umbrella scheme for dalits, comprising scholarships, financing for jobs etc. suffered a massive cut of over 30% from the current year’s revised estimate (which is estimated expenditure). (See Table below) Central scholarships for higher education for dalit students too suffered a cut from previous year’s Budget allocation. This shows the extent of concern that the Modi government has for dalit communities.


Meanwhile, education for adivasi children has stagnated at practically the same level as the current year’s revised estimate while the Vanbandhu Kalyan Yojana, an umbrella scheme for offering price support for forest produce and other livelihood options for adivasis , suffered a cut from the last Budget. (See Table above)

Two major programmes for minorities, the pre-matric scholarship and skill development programme, both have been slashed compared with what was spent last year. (See Table below)



Although the overall Budget for school education has seen a paltry increase, some key aspects have received less funds than last year (See Table below). The important Mid-Day Meal scheme has seen an increase of just Rs. 51 crore (0.005%) compared with last year’s expenditure. In real (inflation adjusted terms) this means an actual decline, harming crores of school going children.


An example of the Modi government’s duplicity is visible in the allocation for the scheme to “incentivise secondary education for the girl child” part of the much-publicised Beti Bachao Beti Padhao programme. Funds for this have been cut from an already embarrassing Rs.255.9 crore to just Rs.100 crore.

True to its intent of privatising higher education, funding for the University Grants Commission has also been reduced while the total allocation for all the Central Universities put together has been nominally increased by only about 1.6% - again an increment that is washed out by inflation.


The Modi government has been waxing eloquent about its insurance-based Ayushman Bharat programme for healthcare, claiming that it will provide essential healthcare to 50 crore people. However, allocation for it has been earmarked at a measly Rs.6,400 crore this year. How this scheme can be rolled out with this amount is anybody’s guess. (See Table below)


In the process, the hollowing out of the existing National Rural Health Mission (NRHM) has already begun, as can be seen by the increase of a mere 2% in its allocation, again, something that will be wiped out if inflation is taken into account. Another crucial head under which allocation has been cut is of upgrading district hospitals (and using them for medical education as well). Allocation has gone down from Rs.3,168 crore to just Rs.2,000 crore. This will force people towards private hospitals.

In fact, health allocations are a definitive pointer to what the BJP government is all about – sabotage existing programmes of state-supported welfare and entitlements (MGNREGS, NRHM, SSA, etc.) by cutting funds in order to roll in private sector-based programmes in various guises (Ayushman Bharat, PMFBY, private education, etc.).

Goyal’s theatrical speech in Lok Sabha and the loud adulation by ruling alliance members had a tragic aspect to it. Evading practically all the important problems, such as the agrarian crisis, unemployment and break down of education and healthcare systems, the government seemed to be scraping the bottom of the barrel to come up with ideas to convince the people of their credentials. Whether this works in the final act, only the coming elections will tell.

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