Social Cost of Living

Standing at the fourth floor balcony, I was staring at the newly inaugurated toll plaza of Badarpur fly-over. Its been a life saver for the thousands crossing the border every day. With enough number of gates, the traffic was moving only swiftly. Though there is an option of not taking the plaza too, and going through the narrow side road. It’s mostly taken by the local autos, some light commercial vehicles and the two wheelers – which anyway are not allowed on the flyovers. Looking at the traffic, it becomes apparent that still 80% of the traffic are actually paying to take on the service. Paying! That too thirty bucks for every trip at least. Even though they are not commercial trips and just to use a road facility.

And that started a chain of thought – why should we pay extra to use for a facility for which we are already paying? We do pay road taxes to use the road – right? And it’s not a private land that we are using – but the same national highway. And that reminded me that there are several places in the highways all across the country, where we keep on paying the toll – just to use a bit of better facility. A facility that the government has given to a private party on BOOT (Build – Own – Operate – Transfer). It’s supposedly a win-win-win solution for all. Government is happy as it do not have to spend money or take on the responsibility of getting the facility in place. The private contractor is happy to construct it and make enough money to recover the money spent on bribes, cost (of course – inflated!) as well as good amount of profit from the toll during the “operate” phase. And seemingly the users – that’s you and me, the general citizen, are also happy with a smooth ride. Funnily at the end of the cycle – we pay twice for a facility, for a facility that we are nearly forced to use – that we are supposed to get free.

Moving along that line of thought, we pay more than once for almost everything in life. We pay to keep a government running, which are supposed to work for us and provide us the facilities; yet we keep paying for all the facilities they provide – from road to water and electricity. Does that mean the 20 – 30& of direct income tax we are paying is just to feed a huge, corrupt – inefficient workforce we call governmental departments? The babu-s? We pay for their salaries, yet we pay them again in bribe for a work we have already paid for – and then still don’t get the work we wanted done. As if we are having maid, whom we pay the salary, and she demands money for not dirtying our home (whereas she was supposed to clean) and then at the end of the day clean it ourselves – funny isn’t it?

With the chain of thoughts going on, I looked down to see the parking lot of our office and the guards managing them, and the workers keeping it clean and usable. Why is it done so? The organization provides facility to its employees so that they can perform to the best of their abilities and add to the growth and bottom-line of the company. Larger and better managed companies’ provides better facilities to its employees – resulting in loyalty and better output. They do not charge the employees for the facilities provided. Nor do they tax its employees for its working. Can we draw an analogy between the company and our country? Our country is showing tremendous growth and output. Which means it is supposed to deliver the return to its stakeholders and workforce? But who are the stakeholders in this case? The handful of politicians in power? The industrialists? Where does the money we create go? I know people will argue that a country cannot be compared to a company as here we all need to share a social responsibility and pay for the facilities provided to the poor. But is that really the case? Well, with a mood to find a solid argument I went hunting for government data on this year’s budget. Well I am not an economist, neither a finance professional, and my exposure to finance is limited to planning for short and mid-term budget for my departments and business units. And initially as I delved into the data, I thought – “gotcha!” – more than 68% expenditure under non-plan expenditure? Went one step deep into the break-up of non-planned expenditure; yeah! One more info – 22.43% of total expenditure is on “Interest Payments and Debt Servicing”.  And if we remove the expenditure on police, interest subsidies and non-plan capital outlay – just 6.83% of total budget expenditure is on heads directly linked to people matters – agriculture, fertilizers, petroleum and likes.

Well, took one more dive, one step more details. And now the entire scenario changes. The 22.42% of budget spent on “Interest Payments and Debt Servicing” is not on the loans taken by government (it says- “From 2004- 05, the provision for interest payment on borrowings under the Market Stabilization Scheme (MSS), have been separately reflected in terms of the MOU on MSS”), but on all governmental projects – small savings plans, insurance covers, loans given, PF and other schemes. Voila – at least some of our money is being well spent. So if we take out the defense (13.29%) police (2%) and grants to Public Enterprises (0.05%), most of the non-plan expenditure are on good cause. And even the planned-expenditure too is not too badly spent.

So it looks like we are a socialist country after all, and the money we contribute is planned to be spent mostly on countries social commitment. Well, whether the money allocated is actually reaching the intended cause is a different question all-together. In Kapil Sibal’s words – “it’s a question of implementation of policy and not the policy itself”.  Happy in my thought I came down to my seat, the chain of thought lost in load of ISO and software.

On my walk back to home, I passed by the same toll complex, and the chain of thoughts got picked up, where I left it at the balcony. So what was the conclusion? Why do we have to pay for the facility to make our life a bit easier? My mind went back to the analogy, the case of services provided by companies’ to its employer. And yes, there was some similarity. Its like the company subsidizing the food at canteen, so that everyone, including those who are paid less, to avail some quality food at lower cost. And the company ensures that there is someone to keep a tab on the quality service provided. At the same time, it gives an option of food counters opened by well-known vendors – “Café Coffee Day”, “Dominos” et al. So if one has the money and willing to spend it for something special, they have a choice. Company simply provides a space for those vendors to operate and it becomes a win-win for all.

And here too the government is doing the same; it provides a free access road to all those who doesn’t want to pay, and use the standard facility; and at the same time given the space to an operator to build a better facility which citizens can “chose” to avail, by paying additional money to the operator. Moving ahead in the same analogy, if the employees in an organization finds out about anyone from the vendors offering a service or another employee trusted with maintaining those services to general employees to be making personal gains, the onus lies both in the hand of employees as well as some empowered seniors to bring them to books. The ordinary employees need to gather enough evidence and bring them to those empowered, so that those seniors can take actions. And I remembered a number of cases where we did ensure that those profit mongers were penalized. I know it’s not that easy in the case of the broader picture of our country. But the analogy still holds, and at least some of us have to take the onus of taking it forward.  I know it still has to be aided by those empowered by us – the politicians in power. And remembering what Bismarck said ““People never lie so much as after a hunt, during a war or before an election”, we need to exercise caution on who we choose, and keep trying till we find the right guys. The intension and frameworks are fine – let’s keep searching for the guys who will implement them right.

2 responses to “Social Cost of Living

  1. hmm.. good to see you ‘writing’ .. though don;t know what else to add.. I agree to your chain of thoughts.. quite well written.. government extracts all kind of taxes and then increases the price also.. sigh..


  2. Good to see you back..with a bang!.. Well, what a provocative writing style Icy 🙂 I must compliment you.. I am feeling so good, I was missing my old bloggers because we used to learn so much by reading each other and sometimes sharing.. and working on the comments, feedback if any.. 🙂 ..

    I completely agree with you, and feel enlightened to the idea of paying again and again for the services which should be made free to us..

    Great work,
    will visit again.. oh I am a follower now 😀 .. he he..


    Megha 🙂


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