"Freebie For One Is Another's Essential Need": Ex-Chief Economic Advisor

Former Chief Economic advisor Arvind Subramanian today joined the debate on "freebies", saying deciding what's a freebie and what's not from the outside is a "mug's game". He slammed the successive state and central governments for failing to cater to basic needs like health and education, housing and infrastructure. He also said promise of freebies cut across political boundaries and so, "no party has the moral high ground" on this issue.

The BJP has opposed the practice of freebies, declaring that it can bring financial ruin on a state. While the stance has been interpreted by many as a strike against its biggest threat, the growing Aam Aadmi Party of Arvind Kejriwal, it has also gained rapid traction.

In an exclusive interview, Mr Subramanian told NDTV what stigmatizes the term "freebies" is the middle-class bias towards the welfare given to the poor, "What gets overlooked are the freebies the middle class gets in spades".

In this context, he recalled the time in 2016, when a list of freebies given to the middle class was  drawn up in the Economic Survey on the request of former finance minister, the late Arun Jaitley. The list was headed by tax cuts and encompassed a range of other benefits like financing of loss-making public sector enterprises.

For now, what passes as freebies -- "I wouldn't necessarily call these things freebies," he said. "Many of these things were actually called basic needs -- housing, power, connectivity through bank accounts and so on," he added.

So, no one is going to win the definition of freebies, he said, as "One man's freebie is another's essential need". As example he cited subsidised power for farmers. "It can be life blood to him but for an environmentalist, it would be a pretty alarming thing".

While Prime Minister Narendra Modi was the first to lash out against freebies and coined the term "rewari", his government has given out freebies worth lakhs of crores under various subsidies and welfare schemes. This would include schemes for housing, free gas cylinders, subsidies for toilets, allowance to farmers and free food during the pandemic.

Mr Subramanian said no government – Centre or state -- has however, really provided free health and education. The "one exception" would be Arvind Kejriwal's Aam Aadmi Party.   

"Freebies are in some ways, symptoms of a problem," Mr Subramanian said. "The underlying problem being the Indian State has not been very good at providing health, education, growth and employment," he added.  "The states cannot provide health and education, the Centre cannot provide employment and growth," which are the markers of a modern, developed society, he said.

The debate reached the Supreme Court as the BJP's Ashwini Upadhyay filed a petition, challenging the entrenched system of promising freebies at election time. So far, Arvind Kejriwal's Aam Aadmi Party, known for providing free power and water in the states it rules, has challenged the stance of the petition. Tamil Nadu's ruling DMK and the ruling YSR Congress of Andhra Pradesh have also gone to court, asking to be allowed to join the proceedings.

In one of the earlier hearings, the bench led by Chief Justice of India NV Ramana, had said provision of freebies were a serious economic issue and the "freebie budget" at election time goes above regular budget.