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  • Category: Miscellaneous

    Must we consider to start charging for some heavily subsidized Government Services?

    One of the main problems facing the Government today is the financial burden being a welfare state. There is no doubt that the Government must run hospitals, schools, Armed services and various services free of cost to a large section of people. But could we define some income limit for those services? A three-tier slab can be suggested where below a certain income limit everyone gets free services. Between some levels, people must pay the charge incurred for the service alone. They need not pay for the salaries of the officials involved in the service. Beyond a certain limit, people must pay the prevailing market rate for services. By this way, the Government can continue to remain a welfare state and also can make up for some of the services financially. This could be used to improve the poor infrastructure of service delivery platforms.
  • #652488
    A very good thought and the author has mentioned a concrete measure to reduce the Govt subsidies and facilities.

    We are still facing some basic issues in our system and struggling with them. Though the number of Income Tax payers is increasing but still many are outside the tax net and for Govt or regulatory agencies it is difficult to find out who can afford or who can not. Due to this confusion many well off people are using or rather misusing these subsidies and facilities.

    Let us see the example of subsidy on cooking gas. We all were taking it but when PM made a personal appeal that the well off people voluntarily drop this benefit, many people came forward and later many were forced to drop it through linkage to their IT return.

    So until unless the boundaries are clearly defined and there are strict guidelines it is very difficult to reduce the list of beneficiaries in any welfare scheme.

    Ration card is another example where governance is so poor that even after the children's employment the parents are taking the subsidised items in a remote village Govt low price shop. That is why it was thought by some prudent planners in Govt to make a universal card like Aadhaar which does things electronically to bring the better governance.

    Anyway these are the ambiguities in the system and till they are there, the Govt expenses on these accounts will remain at staggering heights.

    Knowledge is power.

  • #652491
    Already in some cases, this system is in implementation. For example, the cooking Gas subsidy was not there for the people who are having an income of more than 10 lakhs a Year. Similarly, the income tax slabs are also based on your income. Coming to health services in Telangana and Andhra Pradesh free services are available to the people who are having white cards. These white cards will be issued to some people whose income is less than a specified limit. The government ration cards are also available to certain people who are having income less than the specified limit.
    But the real problem comes because people want to get these benefits and somehow manage with the officials and try to get the subsidy. For example, a person working in a private company will pay the income tax. But he will manage with the village chief and gets the white ration card. Similarly, the farmers who have more than 20 acres of land also will get the health card using his influence with the local MLA or MP. All government employees can't get these benefits as their incomes are very clear. But some of them may have many other sources of income.
    The ultimate suffer is the private employer who is paying income tax to his last paise of income and don't have any influence to get any special benefits. Whatever may be the procedures government starts he is the only suffer I think.

    always confident

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