Of all the arguments that the Centre could have used to buttress its argument against payment of monetary compensation to the families of those who lost their lives in the Covid-19 pandemic, lack of financial resources is perhaps the weakest one. In its arguments before the Supreme Court, which is hearing petitions seeking the Centre to be directed to pay Rs 4 lakh as compensation to each of the families of those who lost their lives to the virus, the Centre has argued that its finances are already stretched and the additional outgo on account of compensation to be paid would entail a huge financial liability. In a 183-page affidavit filed before the Supreme Court, the Centre has also argued that it has already spent huge sums to support those hit hardest by the pandemic, and that it would rather spend the funds on enhancing healthcare facilities to deal with the pandemic, as well as preventive measures such as vaccinations for the public.
Let us take the financial ability argument first. According to official government data, about 3.91 lakh people have so far lost their lives to the Covid19 pandemic. At Rs 4 lakh per head – the amount specified under the Disaster Management Act, the very Act that the government has been using to arm itself with the necessary powers to tackle the pandemic – the compensation outgo will be less than Rs 16,000 crore. For a nation with Rs 135 lakh crore GDP, where the government collects in excess of Rs 1 lakh crore as GST alone every month, arguing that Rs 16,000 crore would stretch the government’s finances beyond repair simply doesn’t wash.
Remember, when the first wave of the pandemic struck, the Centre had come out with a stimulus package amounting to Rs 20 lakh crore to support businesses hit by the pandemic. As per Budget estimates, the total outgo towards stimulus and relief measures amounts to 13 per cent of the GDP. If such a huge sum can be spent on supporting the economic victims of the pandemic, spending a fraction of that sum to support the families of the victims, many of whom have lost their sole breadwinner and many more who have been pushed into abject poverty by the sudden loss of income as well as the catastrophic expenses precipitated by the disease, is not a big ask.
The denial of compensation seems even more callous when juxtaposed against the sums the government has already spent on projects which can by no stretch of imagination be termed pressing national priorities, like the Rs 20,000 crore Central Vista Project, or the Rs 8,000 crore spent on acquiring new VVIP aircraft. It also pales in comparison to the staggering sums that banks are writing off every year on account of bad loans.
Of course, there is considerable debate over the actual death toll, in which case the outgo could be much higher. According to a model prepared by The Economist magazine, over a million people may have already died due to Covid in India. There is enough evidence – by way of the surge in deaths above the normal death rate, to support that underreporting of Covid deaths has been pervasive. The Patna High Court ordered the Bihar government to reverify Covid deaths, which led to a surge in the death toll by over 6,000 in a single day and over 75,000 in just the first five months of this year. If the Supreme Court, which has reserved its judgment on the compensation petition, were to rule in favour of compensation, an accurate reporting of Covid deaths becomes crucial to ensuring that genuine victims are not left out.
Of course, it is not our case that compensation for victims should override other spending priorities. There is considerable merit in the government’s argument that money should be spent on reaching support to those who have lost incomes and livelihoods, and enhancing the healthcare infrastructure to treat those infected. In fact, the pandemic has underscored the appalling gaps caused by decades of underspending on healthcare. It has also highlighted the need for physical healthcare infrastructure in the form of health centres and hospitals, rather than an insurance scheme where the task of actual providing of care is left to someone else.
Nevertheless, it makes both economic and political sense to treat the victims of the pandemic as the victims of any other natural disaster. Politically, spending lakhs of crores in corporate loan write-offs while denying meagre compensation to the poor will boomerang. Smarter politicians have seen this. The Delhi government, for instance, has already announced Rs 50,000 as one-time compensation and Rs 2,500 per month as ongoing support. Economically, any compensation given to families of those who died will be spent immediately and thus revive consumption spending. Households which have lost their sole earners and children who have been orphaned without even support of their families are surely deserving of a helping hand from the State which aspires to be a global superpower.