POVERTY COMMITTEE
Dadabhai Naoroji Committee
Y K Alagh Committee
Lakdawala Formula
Suresh Tendulkar Committee
Rangrajan Committee
Current Status: Arvind Panagariya Task Force
Dadabhai Naoroji(1967-68):-The history of poverty estimation in India goes back to 19th century when Dadabhai Naoroji’s efforts and careful study led him to conclude subsistence based poverty line at 1867-68 prices, though he never used the word “poverty line”. It was based on the cost of a subsistence diet consisting of ‘rice or flour, dhal, mutton, vegetables, ghee, vegetable oil and salt’.
According to him, subsistence was what is necessary for the bare wants of a human being, to keep him in ordinary good health and decency. His studies included the scale of diet and he came to a conclusion on the subsistence costs based poverty line that varied from Rs.16 to Rs.35 per capita per year in various regions of India.
National Planning Committee(1969):- The Committee regarded the irreducible minimum income between Rs. 15 to Rs. 25 per capita per month at Pre-war prices. However, this was also not tagged something as a poverty line of the country.
First Planning Commission working group.The concept of the poverty line was first introduced by a working group of the Planning Commission in 1962 and subsequently expanded in 1979 by a task force. The 1962 working group recommended that the national minimum for each household of five persons should be not less than Rs 100 per month for rural and Rs. 125 for urban at 1960-61 prices. These estimates excluded the expenditure on health and education, which both were expected to be provided by the state.
Y K Alagh Committee(1979):-The approach to estimate poverty was traditional i.e. lack of income. It was later decided to measure poverty precisely as starvation i.e. in terms of how much people eat. This approach was first of all adopted by the YK Alagh Committee’s recommendation in 1979 whereby, the people consuming less than 2100 calories in the urban areas or less than 2400 calories in the rural areas are poor. The logic behind the discrimination between rural and urban areas.Thus, YK Alagh eventually defined the first poverty line in India.
It's CPI based upon.
Lakdawala Formula(1989-1993):-Till as recently as 2011, the official poverty lines were based entirely on the recommendations of the Lakdawala Committee of 1993. This poverty line was set such that anyone above them would be able to afford 2400 and 2100 calories worth of consumption in rural and urban areas respectively in addition to clothing and shelter. These calorie consumptions were derived from YK Alagh committee only.This committee defined poverty line on the basis of household per capita consumption expenditure.
The committee used CPI-IL (Consumer Price Index for Industrial Laborers) and CPI- AL (Consumer Price Index for Agricultural Laborers) for estimation of the poverty line.
The method of calculating poverty included first estimating the per capita household expenditure at which the average energy norm is met, and then, with that expenditure as the poverty line, defining as poor as all persons who live in households with per capita expenditures below the estimated value.
Suresh Tendulkar Committee(2005-2009:-Suresh Tendulkar committee was constituted by the Planning Commission. The current estimations of poverty are based upon the recommendations of this committee. This committee recommended to shift away from the calorie based model and made the poverty line somewhat broad based by considering monthly spending on education, health, electricity and transport also.it's based upon daily PCI.
The Tendulkar panel stipulated a benchmark daily per capita expenditure of Rs. 26/27 and Rs. 32/33 in rural and urban areas, respectively, and arrived at a cut-off of about 22% of the population below poverty line. However, this amount was such low that it immediately faced a backlash from all section of media and society.
Since the numbers were unrealistic and too low,
The government appointed another committee under Prime Minister’s Economic Advisory Council Chairman C. Rangarajan(2012-2014) to review the poverty estimation methodology. Brushing aside the Tendulkar Committee. Rangarajan committee raised these limits to Rs. 32 and Rs. 47.
Current Status: Arvind Panagariya Task Force:-The discussion about Lakdawala Formula, Suresh Tendulkar Committee and Rangarajan Committee make it clear that defining a poverty line in India has been a controversial issue since 1970s. The latest poverty line defined was by Rangarajan Formula.
Y K Alagh Committee
Lakdawala Formula
Suresh Tendulkar Committee
Rangrajan Committee
Current Status: Arvind Panagariya Task Force
Dadabhai Naoroji(1967-68):-The history of poverty estimation in India goes back to 19th century when Dadabhai Naoroji’s efforts and careful study led him to conclude subsistence based poverty line at 1867-68 prices, though he never used the word “poverty line”. It was based on the cost of a subsistence diet consisting of ‘rice or flour, dhal, mutton, vegetables, ghee, vegetable oil and salt’.
According to him, subsistence was what is necessary for the bare wants of a human being, to keep him in ordinary good health and decency. His studies included the scale of diet and he came to a conclusion on the subsistence costs based poverty line that varied from Rs.16 to Rs.35 per capita per year in various regions of India.
National Planning Committee(1969):- The Committee regarded the irreducible minimum income between Rs. 15 to Rs. 25 per capita per month at Pre-war prices. However, this was also not tagged something as a poverty line of the country.
First Planning Commission working group.The concept of the poverty line was first introduced by a working group of the Planning Commission in 1962 and subsequently expanded in 1979 by a task force. The 1962 working group recommended that the national minimum for each household of five persons should be not less than Rs 100 per month for rural and Rs. 125 for urban at 1960-61 prices. These estimates excluded the expenditure on health and education, which both were expected to be provided by the state.
Y K Alagh Committee(1979):-The approach to estimate poverty was traditional i.e. lack of income. It was later decided to measure poverty precisely as starvation i.e. in terms of how much people eat. This approach was first of all adopted by the YK Alagh Committee’s recommendation in 1979 whereby, the people consuming less than 2100 calories in the urban areas or less than 2400 calories in the rural areas are poor. The logic behind the discrimination between rural and urban areas.Thus, YK Alagh eventually defined the first poverty line in India.
It's CPI based upon.
Lakdawala Formula(1989-1993):-Till as recently as 2011, the official poverty lines were based entirely on the recommendations of the Lakdawala Committee of 1993. This poverty line was set such that anyone above them would be able to afford 2400 and 2100 calories worth of consumption in rural and urban areas respectively in addition to clothing and shelter. These calorie consumptions were derived from YK Alagh committee only.This committee defined poverty line on the basis of household per capita consumption expenditure.
The committee used CPI-IL (Consumer Price Index for Industrial Laborers) and CPI- AL (Consumer Price Index for Agricultural Laborers) for estimation of the poverty line.
The method of calculating poverty included first estimating the per capita household expenditure at which the average energy norm is met, and then, with that expenditure as the poverty line, defining as poor as all persons who live in households with per capita expenditures below the estimated value.
Suresh Tendulkar Committee(2005-2009:-Suresh Tendulkar committee was constituted by the Planning Commission. The current estimations of poverty are based upon the recommendations of this committee. This committee recommended to shift away from the calorie based model and made the poverty line somewhat broad based by considering monthly spending on education, health, electricity and transport also.it's based upon daily PCI.
The Tendulkar panel stipulated a benchmark daily per capita expenditure of Rs. 26/27 and Rs. 32/33 in rural and urban areas, respectively, and arrived at a cut-off of about 22% of the population below poverty line. However, this amount was such low that it immediately faced a backlash from all section of media and society.
Since the numbers were unrealistic and too low,
The government appointed another committee under Prime Minister’s Economic Advisory Council Chairman C. Rangarajan(2012-2014) to review the poverty estimation methodology. Brushing aside the Tendulkar Committee. Rangarajan committee raised these limits to Rs. 32 and Rs. 47.
Current Status: Arvind Panagariya Task Force:-The discussion about Lakdawala Formula, Suresh Tendulkar Committee and Rangarajan Committee make it clear that defining a poverty line in India has been a controversial issue since 1970s. The latest poverty line defined was by Rangarajan Formula.
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