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Families with an annual income of Rs 1.5 lakh are among the richest 20 per cent in the country data from the 2011-12 round of India Human Development Survey (IHDS) conducted by the National Council for Applied Economic Research (NCAER) shows.

While incomes have grown considerably in the last seven years access to adequate public services is still severely lacking says the data collected from 42000 households across the country.

The NCAER whose survey is being reported exclusively by The Hindu is the only research organisation with a large sample survey to estimate household income. The government’s National Sample Survey Organisation (NSSO) collects data on consumption expenditure which is often used as a proxy for income.

For the 2011-12 IHDS the NCAER research team returned to over 80 per cent of the households it had interviewed in 2004-05 to make an estimate of the change over the last seven years. In 2004-05 a family earning Rs. 70000 annually would have been among the richest 20 per cent in the country while in 2011-12 the same family would find a place in the middle of the distribution. An annual household income of Rs. 25000 placed a family in the middle of the order in 2004-05. In 2011-12 Rs. 25000 is the annual income of the poorest 20 per cent of Indians.

Moreover this growth has been despite inflation. The real (inflation-adjusted) median income in 2004-5 was Rs. 28200 and it grew by nearly 4.7% annually to Rs. 37500 in 2011-12

The situation on the public services front is still grim. Piped water available indoors has grown by only 2% and is now available to 27% households. In urban areas piped water is available to between half and two-thirds of families. Of families which get piped water less than a third get three hours of supply a day.

Gujarat Maharashtra Goa and Delhi have the highest coverage of families for piped water (60%). Delhi gives its residents water for the most number of hours in a day.

Flush toilets are now accessible to one-third of all households and over two-thirds of urban households. Toilet coverage is the highest in Kerala (92%) Delhi (79%) and Punjab (74%).

Access to electricity is inching towards becoming universal with 83 per cent of all households getting supply. Jammu and Kashmir Himachal Pradesh and Delhi have 100% access to ‘some electricity’. No State had reached this milestone in 2004-05. Just 45% households with access to power get 18 hours or more of electricity in the day. Himachal Pradesh Punjab Kerala Delhi and Gujarat lead the country in terms of supply of 18 hours or more.

For the last two weeks The Hindu has reported exclusively on an exciting new dataset the National Council for Applied Economic Research’s (NCAER) India Human Development Survey (IHDS) 2011-12. It’s an exciting dataset for three big reasons.

One it’s a 42000 household-strong nationally representative survey with questions on both economic and social issues. Two it has substantial panel data – which means data that allows for comparison over time – because the NCAER researchers went back and interviewed 80% of the households they spoke to for the first round of the IHDS in 2004-5. Three it is a credible and independent body giving researchers the media and readers access to information that we otherwise depend almost entirely on the government for.

The NCAER gave The Hindu access to the data ahead of its publication. Their researchers wrote five opinion pieces for us looking at five major transformations in the country: the status of women whether the Mahatma Gandhi National Rural Guarantee Scheme is doing its job the revival in the Public Distribution System despite its flaws auditing the performance of public education and healthcare and on what is happening with income growth an inequality (forthcoming).

Using the NCAER data (but reporting independently on it) I wrote five news stories for the paper:

1. The first showed that an alarming number of women have little say in the fixing of their marriage and other constrained freedoms. There was also an infographic with it that illustrated the data.

2. The second showed that a combination of farm and non-farm work is now for the first time the most common form of employment in rural areas (as against agriculture alone)

3. The third showed that the amount children learn in school is mediated by caste class and location – and is falling all round.

4. The fourth showed that there has indeed been a big increase in incomes while access to services has creeped along. This is of note particularly because this is India’s only source of income data – the NSSO measures consumption only – thereby revealing India’s first credible income data in seven years. An accompanying infographic showed what class differences mean in concrete terms.

5. The final part (forthcoming) gave a more realistic picture of what the Indian middle class really looks like.

 For a data journalist it’s been a real joy having such high quality data to work with and play with for the last few weeks. We hope you’ve read along and found numbers that shone a light on to something you didn’t know.

Passage of the National Food Security Act (NFSA) has put the Public Distribution System (PDS) at the core of the national mission to feed the hungry. The PDS operated via “fair price” or ration shops will distribute up to 5 kg of rice at Rs. 3 per kg. wheat at Rs. 2 per kg or millet at Rs.1 per kg per person per month to 75 per cent of the rural population and 50 per cent of the urban population. 

Will the PDS be able to handle this scale of distribution? Will availability of practically free grains overcome the potential inconvenience of buying from a single shop? Will this allocation meet all the households’ cereal needs? Some of the data from the India Human Development Survey (IHDS) conducted by the National Council of Applied Economic Research and the University of Maryland provides a guide to the recent past. About 42000 households were surveyed in 2004-05 and once again in 2011-12 and provide an interesting description of how PDS has grown in importance for ensuring household food security in an era of rapid food price inflation. 

PDS cards come in three flavours — Above Poverty Line (APL) Below Poverty Line (BPL) and the Antyodaya Anna Yojana for the poorest of the poor. Here we combine BPL and Antyodaya card holders. While the Central government decides on the proportion of a State’s population that is eligible for BPL status States identify which particular households should get which card using their own criteria. 

Substantial efforts were made between 2006 and 2012 to improve targeting of BPL cards and expand the number of Antyodaya cardholders. 

Did retargeting of PDS work? Comparing access to BPL cards across different income categories (using 2012 constant prices) paints a picture of the glass both half full and half empty. In 2005 44 per cent rural and 31 per cent individuals with monthly incomes of Rs. 300 or below had a BPL card; by 2012 this proportion had risen to 56 per cent (rural) and 36 per cent (urban). But while an effort was made to include the poorest affluent households also benefitted. Among households with monthly per capita incomes of Rs 2000-2500 the proportion of households with BPL cards grew from 25 per cent to 43 per cent in rural areas and from 15 per cent to 29 per cent in urban areas.

Inefficient targeting

This low relationship between income and type of ration card is worrisome because it suggests that it is difficult for us to identify the poor and target subsidies. NFSA plans to provide subsidised grains to 75 per cent of the rural households so it should cover most of the poor; but for urban households where only 50 per cent are expected to receive BPL cards this inefficient targeting could be highly problematic with poor households being excluded from receiving subsidised grain while some middle income households benefit.

Apart from retargeting of PDS the years 2009-2012 also saw runaway food price inflation. So looking at the IHDS data from 2005 and 2012 allows us an opportunity to examine the role of PDS in household food security during times of high inflation.

The biggest change took place in people who actually purchased grains in PDS termed PDS off take. Only 25 per cent of the respondents purchased grain from the ration shops in 2004 but over 50 per cent did so in 2012. Food price inflation accounts for much of this increase but perhaps increasing efficiency of PDS shops could also account for some of the increase. People with APL cards are supposed to receive grains at the market price and only 12 per cent APL households purchased grain from PDS shops in 2005. By 2012 this proportion had risen to 29 per cent. Even if they had to pay the full PDS price in an era of rapidly rising prices full PDS price was still lower than the market price. This increase was particularly large in the cities. However since the quantities that can be purchased via PDS by BPL households is limited only about 4.5 kg of grains per month per person was purchased from PDS forming about 45 per cent of the total grain consumption. Once households decided to buy from fair price shops the amount they purchased was determined by the allowance and did not vary between two survey years or across different income groups.

These observations create an interesting quandary. On the one hand PDS has begun to play a far greater role in the household food consumption in recent years and with the expansion of its role under NFSA will be even more important. On the other hand it only covers less than 50 per cent of a household’s cereal intake. If the expansion of PDS results in an increase in market prices it may have a substantial negative impact on household budget and may well counterbalance the benefits of food subsidy.

Vast regional differences

While we have painted a national picture here regional differences in the importance of PDS in household food budget are vast. Whereas in north-central India only about 40 per cent of the people buy grains from ration shops nearly 85 per cent in the south use food from ration shops.

These observations suggest three major challenges for the country as we move forward. First identifying the poor is likely to remain a problem particularly for the urban areas. Second since PDS covers less than half of the households’ cereal budget if the expansion of NFSA affects cereal prices it will impact all households even those covered by NFSA. Third inter-State disparities will continue to persist given the complex equation between the Centre and the State in providing food subsidies.

(Sonalde Desai is with the National Council of Applied Economic Reasearch and the University of Maryland. This is Part 3 of the five-part NCAER series.)

Sonalde Desai Debasis Barik and Tushar Agarwal 

There is something ironic about politicians making announcements about the Right to Education or the Right to Health when the only thing they can ensure is allocation of funds. Their control over the usage of these funds is somewhat weak; the overall quality of services is even weaker; their control over actual health or educational outcomes is the weakest.

Looking at education and health behaviours and outcomes using data from the India Human Development Survey (IHDS) of 2004-05 and 2011-12 paints a picture of striking dissonance between government programmes and experiences at the ground level. The period between 2004-05 and 2011-12 saw initiation of several new programmes. The Right to Education Act (RTE) was implemented in 2010; the National Rural Health Mission (NRHM) began in 2005; the Janani Suraksha Yojana (JSY) began in 2005 to be implemented alongside the NRHM. Substantial expenditure was incurred in each of these centrally-sponsored programmes. Below we look at changes in education and health to see how these programmes line up with outcomes.

 Privatisation

The implementation of the RTE should in theory lead to higher enrolment in government schools and better educational outcomes. Ironically we see the reverse. Private school enrolment increased from 28 to 35 per cent between 2005 and 2012 for children of 6-14 years even before poor students in private schools were reimbursed. At the same time in keeping with the findings of various Annual Status of Education Report surveys the IHDS also found a small decline in reading and writing skills among children of 8-11 years. While 54 per cent of children could read a simple paragraph in 2005 there was a modest decline to 52 per cent in 2012. A similar decline was observed for basic arithmetic skills like two digit subtraction from 48 per cent to 45 per cent. For government schools the decline was higher — nearly 5 percentage points for both outcomes but a shift from government to slightly better performing private schools limits the overall decline in skill levels.

This growing privatisation of education was matched by continued and slightly increased privatisation of health care. The NRHM is supposed to strengthen preventive and curative care particularly in rural areas and in States with poor health infrastructure such as Uttar Pradesh Bihar Rajasthan Madhya Pradesh. However a very small proportion of the Indian population relies on public facilities. About 70 per cent of patients visit private providers — either as their first choice or once they are frustrated with public services.

Between 2005 and 2012 years when the NRHM was implemented instead of increased usage of government services we see a modest growth in the use of private services for minor illnesses such as cough cold and fever (from 69 per cent to 73 per cent) as well as for treatment of major illnesses like diabetes cancer and heart problems (from 67 per cent to 72 per cent). Ironically the greatest increase in the use of private services is in high-focus large States like U.P. Bihar Rajasthan M.P. and Orissa. Here the proportion of patients going to private providers increased by nearly 5 percentage points.

The disenchantment of parents and patients with government services is widespread. When asked in 2012 about their confidence in government and private schools and medical facilities 53 per cent of the respondents expressed confidence in government schools compared to 72 per cent for private schools. Similar differences are observed for confidence in government doctors vis-à-vis private doctors. What explains this? There is no reason to believe that private doctors and teachers are more qualified than government doctors and teachers. Typically government recruitment standards are more stringent about training and qualifications while there is little control over the private sector. It is hard to imagine that anyone would prefer a self-styled private “doctor” in a distant village to an MBBS doctor in a Primary Health Centre (PHC). Yet this is exactly what we see around us.

The reasons for these preferences are myriad. Parents and patients feel disrespected by government service providers and may find they get better service if they pay. For example about 6 per cent of the patients see a government doctor or nurse in their private practice rather than in the government dispensary where the same services could be practically free. Government facilities are often irregular in their opening times and teacher and doctor absenteeism adds to the disenchantment. The classroom environment is often not friendly and supportive. The IHDS finds that children are scolded and physically punished in both government and private schools. Indeed our qualitative interviews suggest that parents consider this to be a sign that the teachers care about students. But this scolding is not balanced by positive reinforcement in government schools. Only about 33 per cent parents of 8-11-year-olds in government schools claim that their children received any praise in the school in the prior month; this proportion is about 55 per cent for private schools.

These observations reflect our pessimism about the potential for improving government health and educational services regardless of the “rights” that get enshrined in the Constitution. Any service delivery system that insists that a doctor live in a remote village is doomed to failure since doctors must also think of their children’s education. But instead of focussing mainly on village-based sub centres — which patients rarely seem to use — enhancing PHCs which are located in slightly larger and perhaps better connected towns may have a greater potential for improving the quality of services. Thoughtful organisation of services has a far greater potential for enhancing health and educational outcomes than ideologically influenced discussions of rights.

Some good news

The success of the JSY in increasing hospital deliveries is heartening. The years following the initiation of the JSY document a striking increase in hospital deliveries. This increase is greatest in large focus States. Here the hospital delivery rate has jumped from 25 per cent to 56 per cent between 2005 and 2012. Most of this improvement is in government hospitals — from 14 per cent to 40 per cent. This success may be due to the efforts made by medical personnel in response to cash incentives they receive and the fact that hurdles to hospital delivery like transportation have received consideration in programme design. Although the quality of maternity care remains a concern increasing utilisation certainly points to the success of the programme. This suggests that focussing on smarter organisation of public services that aligns with provider incentives and enhances efficiency offers potential.

Published in: The Hindu April 2 2014

Private school enrolment continues to rise but the already low levels of what children are learning in schools — both government and private — continue to fall new data shows.

The Hindu is reporting exclusively on the findings of the 2011-12 round of India Human Development Survey (IHDS) a representative national sample of 42000 households carried out by the National Council for Applied Economic Research (NCAER).

The previous round of the IHDS was conducted in 2004-05 allowing for a comparison of change over the last eight years using independently collected data.

The numbers show that enrolment in government schools now make up 65 per cent of all school enrolment down from 72 per cent in 2004-05. Private school enrolment ranges from as high as 61 per cent in Jammu and Kashmir and 56 per cent in Uttar Pradesh to as low as 12 per cent in West Bengal and Odisha and 13 per cent in Bihar. It is higher among boys in urban areas and among richer households.

Private school enrolment is increasing even though it is five times as expensive as going to a government school.

The average Indian family spends over Rs. 7000 per year per child enrolled in a private school as compared to less than Rs. 1400 per child in a government school. Household expenditure on private schooling ranges from over Rs. 18000 in Delhi to just over Rs. 3500 in Uttar Pradesh.

Dropout rates high

Despite the success of the United Progressive Alliance (UPA) in bringing in near-universal primary school enrolment the dropout rate remains troublingly high. About 40 per cent of teenagers above 15 years who made it to Class V said they dropped out before reaching Class IX and another 40 per cent of those who reached Class X said they dropped out within a year.

Dropout rates are slightly higher for girls and far higher in rural areas and have reduced very slightly since 2004-05. Bihar continues to have India’s highest dropout rate.

To measure how many children are learning in school the NCAER administers the test developed by NGO Pratham for its Annual Status of Education Report (ASER). The results help test the ASER findings that have been criticised by the government which says its own surveys show better results.

The NCAER researchers found that just 52 per cent children between 8 and 11 years could read at a Class II level and just 45 per cent could do a basic mathematical function subtraction. This is a small fall since 2004-05 for which the numbers were 54 per cent and 48 per cent respectively.

Children in private schools learn more than in government schools but not very much and those in cities belonging to richer households and those who come from forward castes do better. These numbers largely corroborate the ASER’s findings.