Editorial #1 Cash transfer schemes for women as new poll plank
Introduction
In the context of the Maharashtra and Jharkhand Assembly elections, a distinct pattern emerged where cash transfer schemes targeting women played a pivotal role in political campaigning. The National Democratic Alliance (NDA) government in Maharashtra introduced the ‘Mukhyamantri Majhi Ladki Bahin Yojana’ in August, offering ₹1,500 monthly financial assistance to eligible women through their Aadhaar-linked bank accounts. Similarly, the Opposition-ruled state of Jharkhand launched the ‘Jharkhand Mukhyamantri Maiya Samman Yojana’, providing ₹1,000 to eligible women. These direct cash transfer schemes, while not new, have gained significant traction in recent times, with 14 states already implementing similar initiatives covering a significant portion of India’s adult female population. However, the increasing popularity of such schemes across states raises pertinent questions: Is this a result of policy learning, or is it driven by a political need to keep up with emerging trends? Are we seeing a shift towards a welfare system that relies primarily on direct cash transfers?
Key Reasons Behind the Growing Popularity of Cash Transfer Schemes:
- Women’s Increasing Political Presence:
The growing presence of women as an influential political force in India is a critical factor. Female voter turnout has increased from 47% in 1962 to 66% in 2024, with a similar trend observed in state elections. This rise in female participation, coupled with the trend of women voting independently, has created a distinct ‘women constituency’ that political parties cannot afford to ignore. The quick passage of the Women’s Reservation Bill in Parliament and the increased focus on ‘Nari Shakti’ underscore the pressure on political parties to cater to this demographic. In a competitive electoral landscape, any shift in female voter preferences could drastically affect election outcomes. Ignoring the needs of women voters could come at a significant political cost. - Bypassing the Middleman – The Role of Direct Benefit Transfer (DBT):
Direct Benefit Transfer (DBT) has emerged as a key mechanism to reduce systemic inefficiencies, including corruption and delays in welfare schemes. DBT allows the government to bypass middlemen, ensuring that benefits are directly transferred to beneficiaries’ bank accounts, reducing leakage and increasing transparency. For political parties, DBT also establishes a direct link between the individual voter and the government, reinforcing the political leader’s role in providing welfare. Scholars Yamini Aiyar and Neelanjan Sircar describe this relationship as “techno-patrimonial,” where technology plays a key role in strengthening personal loyalty to the leader. This model, though efficient, may also contribute to consolidating political power by fostering direct dependence on the leader’s actions. - Ease of Political Messaging:
Cash transfers are an immediate and visible way to demonstrate a government’s commitment to welfare. Unlike infrastructure projects such as the construction of schools or hospitals, which require significant time and investment to bear fruit, cash transfers offer a quicker impact. The direct deposit of money into beneficiaries’ accounts serves as a constant reminder of the government’s benevolence, reinforcing the political narrative of the ruling party. This is especially significant in a country where a large section of the population still faces economic inequality and poverty, and where populist schemes often resonate strongly with voters. - The Flattening of Welfare:
The widespread adoption of cash transfer schemes across political parties and states signals a concerning lack of imagination in addressing welfare issues. While the approach may be seen as “policy learning,” it also reflects a failure to think beyond DBT as the primary welfare tool. States, even those ruled by opposition parties, are not offering substantial alternatives to this model, which was initially popularized by the Bharatiya Janata Party (BJP) at the national level. This uniform approach risks oversimplifying welfare delivery and reducing it to a mechanism of financial transactions, without addressing deeper structural issues. - The Larger Issue – Erosion of State Capacity:
While direct cash transfers may seem like a convenient solution to poverty, they also come with significant limitations. Scholars have raised concerns that the focus on “efficiency” through technology in welfare delivery could lead to the abdication of the state’s responsibility to improve its own capacity. Cash transfers, while beneficial in the short term, may encourage citizens to rely on private sector alternatives for their basic needs, thus further disengaging the poor from state welfare systems. In essence, the rich have already moved towards privatized systems, and the poor are being nudged towards the same, despite their limited ability to afford such alternatives. Cash transfers may provide temporary relief, but they cannot address the underlying issues of poverty, inequality, and systemic inefficiency. The state must still address these structural issues to ensure long-term, sustainable welfare.
Conclusion:
The growing popularity of cash transfer schemes such as ‘Ladki Bahin Yojana’ and ‘Maiya Samman Yojana’ highlights the increasing centrality of financial aid in political campaigns. However, this trend also raises concerns about the diminishing imagination in welfare policy, with cash transfers becoming a substitute for more comprehensive solutions. As political parties across states continue to adopt similar welfare strategies, the larger question remains: Is India’s welfare system evolving into one focused solely on efficiency and financial transactions, or will there be a renewed focus on addressing the deeper systemic issues that perpetuate poverty and inequality? The answers to these questions will determine the future of welfare policy in India.
