WELFARE REGIMES IN DELHI Case Study of Old Age Pensions UC Berkeley-IIHS Conference, March 2012 Shrayana Bhattacharya.

WELFARE REGIMES IN DELHICase Study of Old Age Pensions

UC Berkeley-IIHS Conference, March 2012Shrayana Bhattacharya

Today’s Agenda

•Background on Pensions Schemes

•Outcomes• Payment systems function

well• Lack of systematic data on

coverage • Exclusion of “Slum”-

Dwellers and Migrants.

Paperwork• Proving Eligibility is costly• Delhi’s Identity crises• Lack of Portability

Politicians • Costs of Connectedness• Missing ‘Clientalism’• Missing Collective action

Describing MechanismsDescribing Patterns

BACKGROUND & data • Motivation of Study• Introducing Old Age Pension Schemes• Data sources (JPAL+MC+World Bank+CPR)

CONTEXT SETTING• Nascent welfare machinery at the district level

• Increasing focus on Geographical Targeting – Defining “Slums”

• Move away from “Poverty” to “Vulnerability” Set in motion a series of administrative reforms since 2005

• Move towards universalization and relaxing BPL and prioritization based on residence, socio-demographic attributes of households.

• Samajik Suvidha Sangam (Mission Convergence) key component in urban administrative reform for welfare assistance.

Attributes of Benefit Recipients (MC 2010, JPAL 2012)

More likely to be enrolledLess likely to be enrolled

HH has disabled members

Head of HH is female

HH lives in unrecognized slum

HH lives in JJ Colony/Recognized Slum

HH has ration card

HH has bank account

MLA specific + Neighborhood “A” MCD property tax classification

Case Study: Old Age Pensions

Monthly financial assistance of 1000 INR to poor & elderly• Above 60 years• Family income < 60,000 INR (per annum)

Managed by District Social Welfare Office

OUTCOMES • Lack of systematic data on coverage and targeting

outcomes• Payment Systems function well – no delays or

deficits reported

Are Delhi’s Elderly Poor Covered ?Yes, according to the administrative arithmetic……

Total number of OAP Beneficiaries : 0.38 million

Are Delhi’s Elderly in Slums Covered?

Low coverage rates; these change along residence continuum

•Recognized : JPAL (2012) finds that 32% of eligible households receive OAP.

•Recognized and Unrecognized : Mission Convergence (2010) finds only 17% of eligible households received benefits, while 82% said they would like to apply/had applied.

•Using administrative data from 2012, 24% are from recognized/unrecognized slum localities and JJ colonies.

Targeting in Recognized JJ colonies (JPAL 2012)

MECHANISMS ? • Low demand and awareness • Despite relaxed eligibility criteria, cumbersome

application process• Administration lacks capacity to verify claims of

applicants• Politicians and Paperwork are gate-keepers

The Problem of Paperwork

Delhi’s Identity Crisis: BPL Targeting and Under-Identification of the Poor (NSS0 07)

Delhi’s Poverty Line

BPL Targeting and Proof of Income The income poor lack credible documentary proof of poverty

•Of those households with BPL and AAY cards, only 16% report household annual income below the OAP eligibility threshold.•In non slums : 21%, of those with households with annual household income below the OAP eligibility threshold have BPL ration cards (IHDS 2005)•In recognized slums, number dwindles to 15% (JPAL 2012)

GNCTD does recognize that the BPL/AAY cards are not a good indicator of poverty…

• Application process does not require BPL card as proof of poverty.

•Applicants can submit a self attested income statement, which indicates that annual household income is below the eligibility threshold (Rs 60,000).

Documentary Requirements to prove Eligibility

For all Financial Assistance Schemes Income Proof : Self attested income statement

Copy of Bank Account Passbook

Recommendation from MLA/MP/Gazetted Officer mandatory on all forms. Separate letter not required.

Age proof (any one of the following) Ration Card, Voter ID, birth certificate (hospital, school), hospital discharge slip at the

time of the birth of the child, age assessment medical certificate, immunization card, driving license, Passport, PAN Card, any document issued by govt. recognized body stating date/place of birth

Domicile proof (any one of the following) Ration Card, Voter ID, birth certificate (hospital, school), immunization card of any

family member, driving license, Passport, PAN Card, insurance policy, electricity bill, water bill, telephone bill, gas connection receipt, student i-card, service identity card, medical records of treatment in Delhi, caste certificate issued in Delhi, property document, any other document that shows proof of residence >5 years; OR

Two witnesses testifying that they know the applicant for a period of more than 5 years; attaching their domicile proof (no domicile proof needed if witness is MP/MLA)

Applicants Must Possess Singly Operated Bank Accounts No assistance provided by GNCTD to open bank accounts. Even if beneficiary has a joint account, has to open new

singly operated account; no help in opening bank account, but can open with any bank, any branch

Opening singly operated bank accounts is the biggest hurdle for beneficiaries. Banks impose rigid interpretation of KYC norms and seek police verification and documents such as PAN cards. On average, it takes months to open an account (5-6 trips)

The Problem of PaperworkFor non-slum dwelling poor : IHDS (2005) data suggests mixed results on the notion that the income poor are identity poor in Delhi…

•60% of those households with annual household income below OAP eligibility have ration cards. •75% of households with annual household income below OAP eligibility have voter cards.

Compounding constraints, the application process requires two unique documents proving residence and age…

The Problem of Paperwork appears specific to “slums”

Preliminary Data : 34% of individuals have Aadhar (WB 2013)

Majority of Applicants have paperwork and politician signature

Rare for non-documentary and witness route to be used.

Majority reason for rejection is related to lack of ‘adequate paperwork’ (DoSW Admin Data 2011)

87% applications “forwarded” by MLA (Admin data 2011)

70% of OAP recipients received application form from MLA (JPAL 2012)

Two P’s for Pensions

Politicians

Route 1

Paperwork

Must have requisite paperwork

Must have requisite signature

Majority applications “forwarded” by MLA’s, but slum dwellers find it costly to access politicians

Collective action ?

Clientalism ?

Are political party cadre’s/MLA staff incentivized and able to exert effort to forward welfare assistance applications ?

Only 14% of Politician’s party offices are located in recognized slums (Delhi Vidhan Sabha website 2013)

30% of slum households reported interacting with a politician, while only 10% had ever interacted with an administrative officer (Jha et al 2007)

Asset poor = Socio-politically poor (Jha et al 2007)

Problems in accessing MLA’s compounded by ethnicity based networks (Jha et al 2007)

What is the implication of Aadhar and DBT ? Delhi’s Pension Payment Systems satisfy important DBT

operational pre-requisites – digitized database, bank account payments.

Beneficiaries do not report major delays in receiving

payments. There was no issue regarding amounts being remitted: all pensioners interviewed said that pension was regular and the amounts were paid in full every quarter.

Government assistance in financial inclusion and accessing bank accounts is important.

Biometrics can address leakage, fraud and double dipping with MCD pensions schemes– current magnitude of the problem is unknown.

Akin to RSBY, Aadhar based platform is important to activate portability of benefits for migrants in the long term.

Facilitates future convergence of schemes and payment platforms

Bolster identification and enrollment in slums

Intervention

•Create enrollment camps in slums

and JJ colonies to subsidize costs

of application and getting required

attestation and documents.

•Activate witness route via camps.

•Can’t help with mobile populations.

Formalize relationship between Politicians and DoSW

Migrants and Mobile Populations• Migrants and mobile populations are excluded by

program eligibility rules

• 5 years residence proof a stringent requirement for applicants

• Portability of benefits is a serious issue – not as much for the elderly, but a larger concern in the design of urban welfare systems.

Application Process

Step 1: Applicant Obtains Forms Applicant can approach MLA/MP/district office,

DoSW to obtain (free, Hindi) forms or downloads from SSS/DoSW website

Step 2: Applicant compiles relevant documentation, signatures and completes an Application Form No provision for application assistance Documentary proofs are essential; Signature from Area MLA or Gazetted Officers GRCs no longer in use; operate informally

Submission Process

Step 3: Applicant can either submit forms directly at the district office or submit it via the MLA offices, who further submit them in batches at the district office Initial screening takes place at the district office dealing counter District (East) and District (West) for instance have 4 dealing counters each, solely

for pensions, open from 10 am to 1 pm, Monday to Friday The dealing assistant sitting at the dealing counter checks whether the form is in

order and relevant documentary proofs are attached; checks with originals; applications without adequate proofs or incomplete forms are rejected at the counter itself (dept. could not provide an estimate of how many)

The applicant is issued an acknowledgment slip (directly or gets it later through the MLA office)

Department Officials expect MLA staff to screen applications prior to being forwarded to the district dealing counter.

Applicant can file an application following two routes

With Documentary Evidence – Even this requires MLA attestation/recommendation; the applicant possesses all required documentary proofs, OR

No Documentary Evidence – those without adequate documentary proof of domicile can submit applications with letters of support and attestation by any of the following witnesses -- MP/MLA/Local RWA President/General Secy/Registered SHG President/ICDS or ASHA worker/Gazetted Officer of state or central government/Two neighbors

Sanctioning Process

Step 6: Applications are Rejected/Sanctioned by District Office

Only one officer, per district (District Officer, SW/WCD) is the Sanctioning/Competent Authority for sanctioning pensions No formal prioritization criteria within the pool of

applications; MC criteria on the form, but not used. On paper, the only prioritization criterion used is the time at

which application was received (tracked through the unique diary entry which includes date of receipt of application at the dealing counter), so sanction/rejection does not exceed 45 days from the date of receipt (now being reduced to 30 days, only after department capacity os strengthened); for this pending cases are tracked monthly (format in next slide).

Data analysis on sanctioning highlights that forged documents/lack of adequate proof of residence or domicile account for majority reasons for rejection.