Ex Gratia: Why GOI should pay, Compensating Death

Synopsis: The court mediated decision for COVID 19 death compensation will help the poorest.

Introduction

Recently, Centre on the suggestions of the Supreme Court has agreed to provide financial relief of ₹50,000 per deceased individual to families of those who died of COVID-19. It will also include those who were involved in relief operations or associated with preparedness activities. The assistance will be subject to the cause of death being certified as Covid’.

They will get the amount within 30 days of submitting the necessary documents.

Who will provide the relief amount?

The relief amount, proposed by the National Disaster Management Authority (NDMA), is to be paid out of the State Disaster Response Fund.

SDRF represents a dedicated facility to deal with notified disasters, including COVID-19.

GoI will contribute 75% to each state’s SDRF except for hill states and NE states, where its share is 90%.

What is the concern?

Identification of beneficiaries: Given that many deaths during the covid wave were not certified as COVID deaths, identification of beneficiaries is a challenge in itself. Poorer citizens were most often the victims of this process. Ex gratia payments will most likely leave them out.

Financial Challenges: Though the government has provided Rs 29,983 crore corpus in addition to SDRF, the financial challenge will still remain. For example, we need to keep in mind that expenses related to recurring notified disasters such as droughts and floods will also have to be met.

Clarity: There is no clarity whether ex gratia should have been limited to poorer citizens like the other welfare benefits are. Or should extend to the richer section also.

Non-inclusion of other diseases: There’s also the question of why other disease-related deaths should not attract ex gratia payments. In a country with poor public health and extremely unequal access to quality private healthcare, Covid wasn’t the first and won’t be the last disease that can cause deaths on a large scale.

State finances: It is also important to recognise that states have been at the forefront in fighting the pandemic. But States also face severe funding crunch due to declining revenues. Therefore, pushing states to fund the ex gratia could severely dent resources for other disaster-related expenditures.

Already compensated: More than half of the states have already compensated beneficiaries even before the announcement of NDMA. They provided relief ranging from Rs 10 thousand to Rs 1 lakh. But that compensation was done from CM Relief Fund and not from SDRF.

What should be the way forward?

It is true that on its part, GoI has been proactive with various pandemic-related measures, and it has also allocated Rs 35,000 crore for vaccination. GoI should now work to cover the entire ex gratia cost.

This can be done through two ways. Either GoI can increase its share in SDRFs or it can pay directly through the Consolidated Fund of India.

Source: This post is based on the following articles:

“The court mediated decision for COVID 19 death compensation will help the poorest”: published in the Times of India on 23^rd September 2021

“Vital Relief” published in the Hindu on 24^th September 2021.

“Ex Gratia: Why GoI should pay”: published in the Times of India on 23^rd September 2021.