Implications of the EWS quota verdict

Nearly four years ago, in January 2019 the Parliament passed the 103 rd constitutional amendment carving out a new category of reserved quota for government jobs and for admission to educational institutions. This was a new 10 percent quota for those persons from the economically weaker section (EWS). Upon its passage, there were a slew of petitions challenging the constitutionality of this amendment. The fact is that this rather momentous amendment was passed in Parliament without much debate because the BJP which is the ruling party has an absolute majority in the lower house, Lok Sabha. One of the few objections against the amendment was made in a spirited speech by Ms Kanimozhi, MP from Tamil Nadu. But largely the amendment passed without much discussion.

The verdict of the five-member bench was unanimous in affirming that the economic criteria can be used as a basis for reservation

The Supreme Court this past week in its verdict upheld the constitutionality of the EWS quota and all petitions challenging it were dismissed. The verdict of the five-member bench was unanimous in affirming that the economic criteria can be used as a basis for reservation (something that the petitioners had challenged). The bench was also unanimous in its implied conclusion that because of this new category, now the aggregate total share of constitutionally mandated reservation (scheduled castes, scheduled tribes, other backward classes, and now EWS) would exceed 50 percent, and this was not per se against the constitution.  This too had been one of the contentions of the petitioners. The only issue on which the bench was split 3:2 was whether the SC, ST and OBC groups could be excluded from the newly created category of EWS. The majority view is that their exclusion was ok.

Parliament is supreme, but the spirit of the constitution is more supreme

This amendment and the stamp of validity on it provided by the highest court in the country has many consequences, some of which will be discussed below. Has the judgement dealt a blow to the doctrine of protecting the basic structure of the constitution (something that followed from the landmark 1973 case in the Supreme Court)?  This famous judgement did not define explicitly what is meant by the basic structure. It also did not prohibit the power of the Parliament to pass amendments to the constitution. But it did say, that you cannot pass amendments of such extreme nature, that they distort the very basic principles of our constitution. Parliament is supreme, but the spirit of the constitution is more supreme.

By creating a new category based on economic criteria, to whom special treatment will be accorded (reservation), have we violated the right to equality (article 14)? Or by excluding SC, ST and OBC groups from this new category, have be breached the principle of non-discrimination (article 14 and 15)?  These are questions for scholars of jurisprudence to explore.  Much has already been written and more will follow. One rather penetrating analysis is by Ayan Gupta which can be read at the blog indconlawphil.wordpress.com.  So, it is quite possible that in the days to come a review of the decision of the apex court may be undertaken by a larger bench.

By creating a new category based on economic criteria, to whom special treatment will be accorded (reservation), have we violated the right to equality (article 14)? Or by excluding SC, ST and OBC groups from this new category, have be breached the principle of non-discrimination (article 14 and 15)?

But for now, let us examine other aspects of the amendment and the judgment. Firstly, it is clear that the amendment itself was politically motivated. The word “quotas” has radioactive resonance in the Indian polity, and there is an impression that the amendment was passed to benefit a vote bank of upper-caste voters. But now even Muslims and Christians have also become eligible for the EWS quota. Secondly, the quotas in our constitution were meant to correct longstanding and historical injustice based on caste. They are meant to help those who have suffered from social backwardness for generations.

How can economic backwardness be put in the same category as social backwardness stemming from historical injustice and social backwardness?  A person’s economic status is fluid, and can change with effort or luck or both. Even a person’s religion can be a matter of choice. But caste is an unchangeable marker from birth. So, overcoming caste-based discrimination is not in the same league as economic deprivation.  Thirdly, the cutoff decided for eligibility for the EWS quota is an annual income of 8 lakhs, which seems like a very generous threshold. It is far above the poverty line.

The word “quotas” has radioactive resonance in the Indian polity, and there is an impression that the amendment was passed to benefit a vote bank of upper-caste voters. But now even Muslims and Christians have also become eligible for the EWS quota

By one estimate, more than 95 percent of the households in India will fall under this limit. So, is it a remedy to give quota- based opportunities to the poor, or is it meant for everybody?  Fourthly, if indeed the EWS quota is meant to help those from poor households, then let us look at the profile of those below the poverty line. As per government’s Sinho Commission, nearly 82 percent of the people below the poverty line comprised of scheduled castes, scheduled tribes and other backward classes. Poverty and social backwardness have a high correlation. But those very categories have been denied opportunities in the EWS quota. It is on this point that there was dissent by two of the judges as a matter of constitutional principle.

How can economic backwardness be put in the same category as social backwardness stemming from historical injustice and social backwardness? 

But even from a pragmatic view about poverty, does this not seem questionable as a policy designed to help the poor? It is like saying that we will launch an anti-poverty program, but those people from rural areas, and from agriculture will be excluded since they are covered by other subsidies.  Fifth, the status of economic backwardness is fluid. It should be addressed by affirmative action and not quotas. For instance, providing education loans to students from poor households is better than a quota system for the poor. Sixth, one implication is the scramble for income certificates that this EWS policy will unleash.

The status of economic backwardness is fluid. It should be addressed by affirmative action and not quotas

In an economy where 92 percent people work either in the unorganised, unregistered or informal sector, getting authentic income data is notoriously difficult. Only about five percent of the population pays income tax. So where can we get authentic income data, based on which this EWS policy is going to be implemented? Are we opening the gates for more corruption, rent seeking or fake certificates, and more litigation?

Lastly it is clear, that the EWS reservation has great political resonance because of the scarcity of well paying, stable and high-quality jobs. Most of the jobs are going to be created in the private sector anyway, wherein these quotas don’t apply. Hence the surest way ahead to correct for social or economic injustice is high, sustained, inclusive growth of the economy, jobs and livelihoods. That as always is the real core agenda.

(Dr. Ajit Ranade is a noted economist)

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