Beyond Mandal

Reservations, either for jobs or in educational institutions, have been an article of faith in India ever since the Constitution was adopted, though the results have been less than satisfactory and therefore led to repeated extension of deadlines. Now the government looks all set to increase the scope of such quotas. Apart from the Bill to mandate reservation in unaided educational institutions, which was cleared by the Cabinet earlier and will be piloted through Parliament (perhaps with some amendments), there is a proposal for reservation of jobs in the corporate sector. Till now, the government stand has been that this will be voluntary. Now, it seems that the government is not averse to the idea of introducing job reservations in the private sector through a Constitutional amendment. Newspaper reports suggesting this have met with the response that legislation is only one of the options being considered, and that affirmative action on a voluntary basis remains the government's preferred course of action.

But even the admission that a new law is a potential choice marks a new phase in the government's approach to the issue. Industry has been exploring what it can do in this field, on a pro-active basis, but it should now be prepared for a mandatory requirement (provided the government can get the required numbers in Parliament).

Meanwhile, another proposal that has been mooted is likely to be virtually impossible to implement. The chemicals and fertiliser minister, Ram Vilas Paswan, has proposed a 2 per cent cess, whose proceeds (he estimates it will generate Rs 6,500 crore annually) can be used to provide heavily subsidised health care to the country's poor. First, why a cess on income tax and not a simple increase in the tax rate, unless Mr Paswan wants to enjoy freedom from the normal budgetary discipline of seeking and getting financial allocations? Second, how will the poor get their free or near-free medicines? By producing BPL (below poverty line) cards at chemist shops? The leakage from such an arrangement will be enormous, as has been seen in the case of sugar, kerosene and other commodities. An alternative is to have special chemist shops to dispense medicines only to the poor (a new form of ration shop), or perhaps sell medicines through the existing ration shops""for which they will need the licences that chemists are required to get! None of these is a convincing option, especially since even according to the government's own data, the number of BPL cards issued is way in excess of the number of poor people in the country (as officially estimated)!

A more practicable alternative (in this and many other contexts, like the rural employment guarantee scheme) might be to issue vouchers to the poor. With these they can shop for their medicines wherever they like, and go for medical care at the hospitals they choose. But if vouchers are accepted as a useful method for income transfers, it will become difficult to not consider them for (for instance) education. Issuing educational vouchers with which the poor can shop around for better schools for their children is an idea that has been tried out elsewhere, but will threaten the entire government school system since it has been shown that private schools deliver better results at lower cost.