Budget and Emphasis on Health Sector – All India Radio (AIR) IAS UPSC

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  • May 20, 2021
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Search 23rd February, 2021 Spotlight News Analysis here: http://www.newsonair.com/Main_Audio_Bulletins_Search.aspx

TOPIC: General Studies 2

  • Budget 2021
  • Issues relating to development and management of health

In News: With COVID infections crossing the 1-crore mark, and claiming nearly 1.54 lakh lives, the Government has allocated Rs 64,180 crore in the Union Budget to upgrade public health care infrastructure under a new flagship PM AtmaNirbhar Swasth Bharat initiative over six years — and unveiled a new expenditure head called “health and well-being”.

  • Spelling out medium and long term expenditure for the public health care system, which came under severe stress during the initial stages of the pandemic, Union Finance Minister Nirmala Sitharaman pegged the total expenditure for “health and well-being” at Rs 2,23,846 crore — an increase of 137 per cent — including Rs 35,000 crore for immunisation with Covid vaccines.
  • The Finance Minister underlined that the Government will take a “holistic approach” this time by strengthening three critical areas: “Preventive health, curative health and well-being.” This will be of immense help to the country at this critical juncture.
  • The allocation shows that drinking water and sanitation has received the biggest boost of 179 per cent, with funds for health and family welfare increasing by 9.62 percent while nutrition witnessed a drop of 27 per cent

The Rs 2.23 lakh crore will include expenditure on six components in varying proportions:

  • Department of Health & Family Welfare (31.83 per cent) with finance commission grant (5.89 per cent)
  • Department of Drinking Water & Sanitation (26.81 per cent) with finance commission grant (16.09 per cent)
  • Vaccination (15.63 per cent)
  • Health research (1.89 per cent)
  • Ministry of AYUSH (1.32 per cent)
  • Nutrition (1.20 per cent)

PM AtmaNirbhar Swasth Bharat 

  • It will be implemented in addition to the National Health Mission — and provide support for 17,788 rural and 11,024 urban health and wellness centres. 
  • This will develop capacities of primary, secondary, and tertiary care health systems, strengthen existing national institutions, and create new institutions to cater to detection and cure of new and emerging diseases
  • Under the new scheme, five key interventions will be implemented, specifically catering to new and emerging diseases: 
    • Integrated public health labs in all districts and 3,382 block units in 11 states
    • Critical care hospital blocks in 602 districts and 12 central institutions
    • A strengthened National Centre for Disease Control (NCDC) and its five regional branches and 20 metro health surveillance units
    • A national institution for One Health, a regional research platform for WHO (South East Asia), nine Bio-Safety Level III laboratories and four regional national institutes for virology.
  • The scheme will also provide funds to set up 15 emergency operation centres and two mobile hospitals, operationalise 17 new public health units and strengthen existing units at the 32 airports, 11 seaports and seven land crossings.

Jal Jeevan Mission (Urban): It aims at universal water supply in all 4,378 urban local bodies with 2.86 crore household tap connections, as well as liquid waste management in 500 AMRUT cities. It will be implemented over five years, with an outlay of Rs 2,87,000 crore.


A Finance Commission grant of Rs 13,000-crore and Rs 35,000-crore for COVID-19 vaccination are one-time allocations and, therefore, do not strengthen the overall system. 

The figures in the budget documents reveal a different story. They show an absolute increase of 9.6 per cent in allocations for the Department of Health and Family Welfare (that includes NHM and Ayushman Bharat). 

  • A 26.8 per cent increase for the Department of Health Research and 40 per cent increase for the AYUSH Ministry do not add up to much since each of them are only 3-4 per cent of the total health budget. 
  • A Finance Commission grant of Rs 13,000-crore and Rs 35,000-crore for COVID-19 vaccination are one-time allocations and, therefore, do not strengthen the overall system. 
  • The core health service and research ministries (H&FW and AYUSH) have together received only an 11 per cent increase.
  • Even in COVID times, the health services get only 2.21 per cent of the total central budget — down from 2.27 per cent in the 2020-21 budget. Computing for inflation, the increase in allocation for health services alone disappears and actually becomes negative.
  • Water and sanitation received a 179 per cent increase over the previous year’s allocation (from Rs 21,518 crore to Rs 60,030 crore) already earmarked for the flagship schemes, Swachh Bharat and Jal Jeevan Mission. But allocation for nutrition decreased by 27 per cent, with the “new” Poshan 2.0 merely combining the poorly performing Supplementary Nutrition Programme and Poshan project. 

Added together, health, water and sanitation and nutrition make up the claimed 137 per cent increase in allocation to “health” services — with a real decline in healthcare and nutrition.

The Way Forward

  • For such public provisioning for universal health coverage, effective low-cost rationalised service system options have to be designed. Insurance schemes only create the mirage of affordability of health services while adding to peoples’ expenses. Community and public services are indisputably the most cost-effective for any society.
  • Water and sanitation are meaningful for health, but not if it only inflates the allocation to “Health and Wellbeing” to create an illusion of responding to health imperatives. In that case, it is only diverting attention from the urgent task of designing an effective universal health care system.
  • If we are to achieve the recommendation by the World Bank and the World Health Organisation that programmes of universal health coverage should aim to reduce out-of-pocket expenditure to 15-20 per cent, we need to do much better in terms of public financing of health. Our out-of-pocket expenditure on health is still around 58 per cent. Ideally, total health expenditure should rise but with public financing contributing the largest share.
  • Health research must be funded more, especially in the area of implementation research to ensure that more money for health translates to more health for the money. 
  • Health technologies need to be incentivised to enhance the effectiveness and equity of health services, through appropriate and affordable innovations. 
  • “Make in India” must support domestic pharmaceutical, vaccine and medical equipment makers for stepping up quantity and quality.

Connecting the Dots:

  • India’s economy rides on health of its people. Do you agree? Discuss.

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