Assembly Elections 2019: Why is the Congress evasive about NYAY scheme this poll season?

Ahead of the 2019 Lok Sabha elections, former Congress President Rahul Gandhi had pitched for a “surgical strike on poverty”. Gandhi had said if the Congress was voted to power at the Centre, his government will transfer Rs 72,000 a year into the accounts of the country’s five crore poor.

The Congress named the scheme NYAY, or Nyuntam Aay Yojana (Minimum Income Scheme), in an attempt to deliver “justice” to the country’s poorest poor.

The scheme was also seen as a rejoinder to PM Modi’s KISAN Yojana, wherein he promised to transfer Rs 6,000 annually (in three equal installments) to the country’s over 12 crore farmers.

Rahul Gandhi, along with other party leaders, used the NYAY Scheme extensively during his campaign trail ahead of the Lok Sabha polls. However, after the Congress’ drubbing, the party has hardly used NYAY as a poll plank for the upcoming Maharashtra and Haryana Assembly Polls.

Why has the Congress been evasive about the NYAY scheme and did it really help the party pick up steam, let’s find out.

Did NYAY resonate with the voters?  

NYAY was launched by the Grand Old Party on March 25, weeks before the polling for Lok Sabha elections began, in an attempt to counter the hyper nationalistic agenda being promulgated by the BJP after the Pulwama terror attack and the Balakot airstrike.

Even though the announcement was late, the Congress hoped to draw attention on the issues of poverty and unemployment through the scheme and project itself as ‘pro-poor’.

A post-poll survey by Lokniti showed that among the poor voters – who would have been the beneficiary of the scheme – only 46 percent were aware about NYAY, a marginal increase from 44 percent recorded in the pre-poll survey.

This meant that despite trying to popularize the scheme through ads, hoardings, etc, awareness about NYAY missed a significant chunk of the target audience.

The post-poll survey also pointed out that respondents had a mixed opinion of the scheme. Around 36% thought the Congress would be able to implement the scheme if it came to power, and an equal proportion thought otherwise. Moreover, around 25%, or one-fourth, were not sure or could not say whether the Congress would be able to keep its promise.

Experts believe that PM Modi’s KISAN scheme overshadowed NYAY as by the time Congress announced it, farmers had already received the first installment. In addition, reports of the Congress not fulfilling their promise of increasing the minimum support price in Chhattisgarh and Haryana dissuaded the voters from choosing the Congress.

Fiscally irresponsible?

Many were of the opinion that the NYAY scheme was commissioned in haste, not considering India’s fiscal situation at the moment. The scheme involved uniform cash transfers of Rs 72,000 a year, or Rs 6,000 a month, to the poorest 20 percent households, or about 50 crore households based on 2011 Census data.

Which meant, the scheme required a mind-boggling sum of Rs 360,000 crore a year, or close to 2 percent of India’s current GDP.

However, the Congress claimed that it was feasible. They had taken inputs from noted MIT professor Abhijit Banerjee, who is a staunch supporter of Universal Basic Income. Although he had suggested a minimum income guarantee of Rs 2,500 a month keeping in mind fiscal discipline. The scheme would have the cost the exchequer Rs 1.50 lakh crore.

While being cautious about the tax reforms that the incoming government would have to introduce to fund the NYAY scheme, Banerjee had said it would only be the first step and eventually central subsidies can be withdrawn.

On October 14, 2019, Abhijit Banerjee, along with Esther Duflo and Michael Kremer, was awarded the Nobel Prize for Economics “for their experimental approach to alleviating global poverty”.

Why is the Congress evasive about NYAY?

Congress' chief spokesperson for Maharashtra, Sachin Sawant, told Moneycontrol that NYAY could be implemented only at the Central level, and is not feasible at the state level.

He said, "NYAY was a part of the manifesto for the Lok Sabha elections, and we would have implemented it had we formed the government at the Centre. [It cannot be implemented in Maharashtra or Haryana] Because the state cannot afford to put Rs 72,000 in every account."

"Instead of that, today we have brought in other schemes such as Rs 1,500 for senior citizens' accounts as a pension. NYAY was necessary for the national economy, and it was mocked at by the BJP. But you see now that person who was a part of formulating it has got a Nobel today," Sawant added.

He stated that the Congress will highlight that NYAY was important from the point of view of the national economy and that it would have been the solution to the economic slowdown. "If the BJP government takes any lessons from the scheme and takes steps accordingly, that's well and good because it will be in the interest of the nation," Sawant said.