Only 50% Indians Fully Vaccinated, Budget for Vaccination Slashed by 85%

Union finance minister Nirmala Sitharaman allocated Rs 107.4 thousand crore to the healthcare sector in the Budget for 2022-23—80% of it will be routed through the ministry of health and family welfare, 3% via the ministry of AYUSH and 17% through the finance ministry. The combined allocation for the ministries of health and AYUSH has increased by 16% from Rs 76.9 thousand crore in 2021-22 to Rs 89.3 thousand crore in 2022-23.

However, the overall budget for healthcare compared to the previous financial year has declined by 14% primarily due to the reduction in allocation for COVID-19 vaccination from Rs 35,000 crore in 2021-22 (Rs 39,000 crore in Revised Estimates for 2021-22) to Rs 5,000 crore in 2022-23 (Table 1).

Though more than 70% of the population is vaccinated, only half of Indians have received two doses. Importantly, only 2% of the completely vaccinated population has received the precautionary or booster shot. In such a situation, the reduction in the budget allocated for pan India vaccination might dampen the drive.

Table 1: Healthcare in Union Budget 2022-23

Besides, the allocation for several pandemic-related programmes and packages has been truncated. No funds have been allocated for the COVID-19 emergency response and health system preparedness package apart from a meagre amount for Pradhan Mantri Garib Kalyan Package (PMGKP): Insurance Scheme for Health Workers Fighting COVID-19. It seems that the Centre is withdrawing the temporary arrangement of budgetary allocation for the pandemic.

The Budget has focussed on health infrastructure by increasing the allocation for Pradhan Mantri Ayushman Bharat Health Infrastructure Mission increased to Rs 5,845.71 crore from Rs 1,040 crore in the RE for 2021-22. It is important to note that 71% of the budget for the Mission is transferred to the states as a Centrally sponsored scheme whereas 17% and 12% are routed through the department of health and family welfare and department of health research respectively under the health ministry as Central schemes for strengthening areas like pandemic research, a platform for one health and biosecurity preparedness, etc.

Table 2: Budget earmarked for ‘Medical and Public Health’ and ‘Family Welfare’

There is a drastic fall in the health budget earmarked under the major head ‘Medical and Public Health. Compared to the previous Budget, the proposed allocation for ‘Medical and Public Health’ under the ministry of AYUSH and the finance ministry has declined by 7% and 86% respectively. Resultantly, there is a cumulative reduction of 33% in the health budget specifically under ‘Medical and Public Health’ (Table 2). The reduction in the budget for the finance ministry is clearly due to the drop in vaccination, as mentioned before.

The overall budget for the ministry of AYUSH has increased by 3% especially in terms of transfer to states through Centrally sponsored schemes (CSS). The allocation for transfer to states has been increased from Rs 553.8 crore in 2021-22 to Rs 800 crore in 2022-23, meaning more resources for the state governments.  

Importantly, 54% of the healthcare budget is largely in the form of transfer to states primarily through CSS. The allocation for CSS under the ministry of AYUSH has increased by 44%. There is an 11% increase in the allocation for transfer to states through the health ministry.

Among CSS operated through the health ministry, the allocation for the National Health Mission—the Centre’s flagship programme since 2005—has been increased by a mere 1% from Rs 36.6 thousand crore in 2020-21 to Rs 37 thousand crore. The Budget Estimates (BE) for Rashtriya Swasthya Bima Yojna have been increased from Rs 1 crore in 2021-22 to Rs 45 crore in 2022-23.

The budget for Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PMJAY) has been increased from Rs 6,400 crore in 2021-22 to Rs 6,412 crore—a mere increase of 0.2%. The RE for 2021-22 were Rs 3,199 crore, less than the 2022-23 BE.

Given the increase in mental health problems across age groups, Sitharaman announced a National Tele Mental Health Programme though its exact outlay will be mentioned in the supplementary Budget. The National Institute of Mental Health and Neuro Sciences, Bengaluru, which is the nodal centre of the programme, has been allocated Rs 560 crore.

The government also rolled out the National Digital Health Ecosystem, which includes the provision of digital registries of health providers and facilities, unique health identity, consent framework and universal access to health facilities. The allocation for the National Digital Health Mission, under National Health Mission, has been increased from Rs 30 crore in 2021-22 to Rs 200 crore in 2022-23.

The Centre’s decision to reduce the health budget by 14% is worrying even as the pandemic continues. Moreover, to reach its stated goal of spending 2.5% of the GDP on health, the Union government should have expanded the health budget, not reduced the allocation. The Budget prioritised long-term preparedness for another pandemic-like situation by allocating more to strengthening the health infrastructure but reduced most of the short-term allocations necessary to fight the ongoing pandemic.

The virus is still mutating and 895 deaths were reported on February 7. The digital platform has been very useful for vaccination management, but the health sector generally suffers from the lack of human resources and infrastructure. Digital platforms would be useful only if the health system is sufficiently strengthened.

Programmes providing immunisation, nutrition and treatment for TB, HIV, etc. have suffered due to the pandemic. Such programmes need a sufficient boost to bring back the patients to the network and regularise their health-seeking behaviour. Digital platforms might be useful for that purpose.

With mental health becoming a major concern, a tele mental health programme is not enough. In the absence of any social security system and the lack of health infrastructure at public hospitals, a significant section of the low- and middle-class population suffered due to the high cost of COVID-19 treatment. In such a situation, more emphasis on health insurance schemes was expected but the allocation for PMJAY and PMGKP didn’t meet expectations.

With the economy preparing to reopen fully, the health system also needs to be prepared for revamping the existing programmes and supporting the citizens from epidemiological and financial risk. 

Pritam Datta is a fellow at the National Institute of Public Finance and Policy, New Delhi, and Chetana Chaudhuri is senior research associate at the Public Health Foundation of India, Gurgaon. The views are personal.