Healthcare Under Modi: In Need of Critical Attention

By Dinesh C Sharma, DNA, May 27, 2015

In television debates on one year of the Modi government, the ruling party and government spokespersons have brushed aside criticism of hefty cuts in social sector-spending by saying there won’t be any real shortage of funds for sectors like health because more money will now be available to states. They have argued that slashing of central government’s health budget should be viewed in the context of the new tax devolution formula that increases the share of state governments in central taxes from 32 per cent to 42 per cent. In effect, this means the future of public spending on health now hinges on the hope that states will prioritise health and allocate more funds for it. 

While it is true that states have been major contributors to health spending with public health expenditure ratio between the Centre and states being 31:69, the Centre’s role has been more critical in terms of providing policy guidance, technical help and direct financial assistance for certain key schemes. The previous government had demonstrated with the National Rural Health Mission (now subsumed in National Health Mission or NHM) that greater central spending can spur states into action in key area. Some programmes like National AIDS Control Programme were fully supported by the Centre. 

In the name of financial devolution, this pattern of funding has been suddenly changed. Besides cutting down budgetary support for NHM and AIDS control, as many as 15 centrally-funded schemes have not been allocated any separate funds for fiscal 2015-2016. Nine of these 15 schemes have been labelled by health ministry as “non-negotiable” for which money must be found somehow otherwise it would have catastrophic impact on equitable access to health.

Read full story here in DNA