The cost of unconditional cash transfers
Data show that an overemphasis on cash transfer schemes is bound to eat into investments needed for other public service sectors such as education
On August 1, the Delhi Chief Minister launched the Lakshmi Yojana which will provide eligible women with an Unconditional Cash Transfer (UCT) of ₹2,500 per month, fulfilling one of the ruling party’s central promises during the Assembly elections. With this, Delhi joins the list of States/UTs which now have such a UCT scheme for women.
Over the last two years, many studies, including the Economic Survey and the 16th Finance Commission (FC) report have raised concerns over the increasing fiscal burden of such schemes. Recent reports show that in States such as Maharashtra and Madhya Pradesh, the number of beneficiaries has been reducing in the name of rationalisation.
