Finances of Centre and state govts under severe strain; cannot provide ex-gratia payment to Covid deceased families: Centre to SC

THE Central Government has, in its affidavit filed before the Supreme Court, said state governments will not be able to afford to provide ex-gratia payment of Rs.4 lakhs to the families of every person who has died of Covid19.

The finances of state governments and the Central Government are under severe strain already due to the reduction in tax revenues and increase in health expenses on account of the pandemic, the Centre has said.

"Utilisation of scarce resources for giving ex-gratia, may have unfortunate consequences of affecting the pandemic response and health expenditure in other aspects and hence cause more damage than good", the Centre submitted to the top court.

The affidavit came in response to the court's notice on a petition seeking compensation of Rs 4 lakh under the Disaster Management Act to the families of those who had died due to Covid19.

The Centre informed the top court that  ex-gratia relief under the Disaster Management Act, to 12 notified disasters was provided through the State Disaster Response Fund (SDRF). The annual allocation for the year 2021-22 for SDRF, for all states combined was Rs.22,184 crore. Therefore, if an ex-gratia of Rs.4 lakh is given for every person who loses their life due to COVID-19, the entire SDRF amount may possibly be spent on this alone and indeed the total expenditure may go up further, the Centre claimed.

Besides, there was no precedent of giving ex-gratia for an ongoing disease or for any disaster event of long duration, extending for several months or years. In fact, granting ex-gratia for one disease, while denying the same for those accounting for a larger share of mortality, would not be fair or proper, the government asserted.

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The Centre also warned that the pandemic was not yet over in the country. "It requires rapidly scaled-up health and non-health efforts for a long period of time which will cost the nation lakhs of crores," it said.

It contended that under the Disaster Management Act, it is the "National Authority" which is empowered to recommend guidelines for the minimum standards of relief, including ex-gratia assistance. This is the function entrusted to the Authority by the law passed by the Parliament and thus the court should not substitute its own judgement for the decision to be taken by the Executive.

"Any attempt to second guess may have unintended and unfortunate constitutional and administrative ramifications. It may also be noted that the term 'Ex-Gratia' itself connotes that the amount is not based on legal entitlement", the Centre asserted.