The Performance of Social Pensions in India: The Case of Rajasthan

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Abstract

The Government of India has recently announced a dramatic expansion of social pension schemes both in terms of coverage and benefit levels. Yet relatively little is known about how these programs are administered or how well they achieve their objectives. This paper assesses the performance of a social pension scheme in the Indian state of Rajasthan. In particular, the authors review the experience with respect to program awareness, coverage, targeting, and leakage as well as delivery mechanisms. The overall assessment is positive and holds broader lessons for social assistance in India. Thus, transaction costs once pensions are sanctioned are low, disbursements are largely as per schedule, leakage in the form of shortfalls in benefits is generally low, and satisfaction levels with the social pension scheme are high. At the same time there are clear areas for improvement on both the policy and administration side. There is evidence of under coverage and high transaction costs associated with the application process. Though targeting is generally progressive, especially for old age and widow pensions though less so for disability pensions, targeting is far from perfect and the eligibility criteria are not strictly enforced. There is a strong case for relaxing, rationalizing, and clarifying some of the existing criteria. On the administration front, several basic issues relating to implementation need to be addressed, particularly with respect to transaction costs in the sanction of pensions, wide inter-district variations in performance within the state, and inadequate record-keeping and monitoring.