Budget 2023: Health budget jumps by nearly two-third but low capital expenditure remains concern

Country's Health budget jumps by nearly two-third in this financial year but low capital expenditure remains a serious concern.

New Delhi :India’s health budget has jumped by nearly two-third in the current financial year in comparison with the allocation during the pre-Covid period, however, the data shows that the capital expenditure, the public money spent on creation of hospitals, clinics, test labs and other such facilities remain at a low level of 4-5% of the revenue expenditure on the health sector.

Under Article 112, the Union government is required to present a statement of its estimated receipts (income) and expenditures in a financial year to the Parliament. India’s low public expenditure on the health sector has always been a cause of concern and the health budget has received greater public scrutiny following the outbreak of Covid-19 global pandemic that killed more than 5,70,000 people in the country and more than 6.75 million people worldwide.

As per the budget documents, India’s public health expenditure through the Union budget has gone up by nearly two-third in the current financial year in comparison with the allocation for the sector during the pre-Pandemic year. The data showed that the Central government spent over Rs 69,000 crore to the health sector in the Union Budget for FY 2019-20, just before the Covid-19 pandemic hit the country in March that year. However, a closure scrutiny reveals that the capital expenditure on the health budget for that year was just Rs 2,772 crore, a meagre 4 percent of the total allocation for the sector in the budget.

A higher capital expenditure in the health sector is crucial for the improvement of public health services as this part of the health budget goes into constructing new hospitals, clinics, test-labs and in buying latest medical equipment for the central government hospitals and labs.

But the data showed that a bulk of the Union health budget goes into revenue expenditure as more than 95 % of the total allocation in that year went to payment of salary and wages and establishment expenditures that don't result in creation of new health infrastructure in the country.

No improvement despite Covid mayhem

The budget data of the last four financial years showed a quantum jump in terms of increased allocation for the health sector in the Union Budget. In 2019-20, the total expenditure (actual) for the health sector in the Union budget was Rs 69,375 crore, which went up to Rs 9,1605 crore in FY 2020-21, the first pandemic year. It was an increase of 22,230 crore, an increase of nearly one third over the previous fiscal.

However, the capital expenditure on the health sector that year was 3,587 crore, which was less than 4 percent of the total budget allocation for the sector. In the last financial year (FY 2021-22), though the total allocation for the health sector was a record Rs 1.24 lakh crore as per the revised estimates, the capital expenditure was just Rs 6,545 crore, little over 5%.

For the current financial year (FY 2022-23), the total allocation has again come down to over Rs 1.13 lakh crore but the capital expenditure remains at a low level of 5,632 crore, less than 5 % of the total allocation for the health sector.