Budget 2021–22 on Health

The budget speech on 1 February 2021 announced an allocation of over `2.2 lakh crore to health and well-being, at 137% higher compared to BE 2020–21. The Fifteenth Finance Commission emphasised the need for strengthening the COVID-19-ravaged health sector by recommending sector-specific grants. The government did not accept the recommendation and, if we discount the health component in the local government grants, the budget allocation for the sector has increased by hardly 10% compared to the 2019–20 actuals.

It was a grand opening for the Union Budget 2021–22 with claims of the allocation for the health sector to have been raised by over 100%: “The Budget outlay for Health and Wellbeing is `2,23,846 crore in BE 2021–22 as against this year’s BE of `94,452 crore an increase of 137 percentage” (GoI 2021: para 39; emphasis added). This allocation needs to be seen from two perspectives. It is a budget presented after the Fifteenth Finance Commission submitted its report for the period 2021–26. It is also a budget that has come after the nation bore the full brunt of the pandemic of the century, namely COVID-19. The budget, thus, has a responsibility to chart the nation’s stand on public expenditure in the health sector for the next five years. Has the so-called “visionary budget” fulfilled its duty to steer the states towards universal health coverage (UHC) by raising the allocation?

Before answering this question, it is necessary to have a view of India’s performance in terms of Sustainable Development Goals (SDGs) and UHC. Finance commissions often study sectors in some detail to assess the fiscal needs. How has the Fifteenth Finance Commission looked at the health sector and what recommendation has it made? What fault lines have been laid bare by the pandemic which has taken a toll of over 1,55,000 lives and pushed the economy back by close to 8%? What vision for the sector does this budget unfurl? This article seeks to cover these issues in some detail.