committee on Poverty

committee on Poverty - A Brief insight

Recently C Rangarajan committee was in news and is an important topic in view of upcoming examinations. So let's understand what is this committee all about, it's recommendations and it's effects.

C Rangarajan committee-

Who is he?

Mr. Rangarajan is a noted economist, and resigned recently from the post of the chairman of Prime minister’s economic advisory council (PMEAC).

Why the committee was constituted-

The Planning Commission in May 2012 had constituted the expert group to review the Tendulkar Committee methodology for estimating poverty, following uproar over the number of poor in the country.

What changes the committee proposed –

Rangarajan committee proposed the changes in current benchmarks for the categorisation of poor’s in India ,the current standards which were set by the recommendations of the Tendulkar committee were –

• Expenditure of Rs 816 per person per month (Rs 27.2 per person per day) in rural areas.
• Expenditure of Rs 1000 per person per month (Rs 33.3 per person per day) in urban areas.
• Total numbers of poor were 269.8 million (21.9% of the total population) according to Tendulkar committee report.

The changes proposed by the Rangarajan panels are as follows-

• Expenditure of Rs 972 per person per month(Rs 32.4 per person per month) in rural areas.
• Expenditure of Rs 1407 per person per month(Rs 46.9  per person per month) in urban areas.
• Total number of poor will rise to 363 million (29.6% of total population) according to C. Rangarajan panel recommendations

What will be the effects of the Rangarajan committee proposals on the economy?

• More people will come under the ambit of below poverty line standards.
• This will increase the number of beneficiaries who can claim the benefits given to the BPL families.
• The step will create more burden on their fiscal budget to help BPL families under the different PDS (public distribution schemes), Rashtriya Swastha Bima Yojana, Swarnajayanti Gram Swarojgar Yojna etc.
• More deserving people who were out of the reckoning due to previous benchmarks would come under the benefits.