The death of our fellow citizens by accident is a matter of routine. Turning the daily newspaper to the city pages inevitably brings news of deaths from accidents of various kinds – a stray bike rider here, a lone bicyclist there, two people sleeping on the pavement, and so on. Every so often, reports of accidents that have a higher count of casualties make it to the front pages, sometimes as the lead story. These describe a bus falling into a gorge or catching fire, a train smashing into another, and on occasion, a boat overturning. Other forms of accidents – bridge or building collapses, stampedes, fires and such – are rarer, but still feature multiple times a year. In India, there is no end to the news of accidental death.A familiar story emerges after the accident. The state chief minister announces ex gratia compensation to the next of kin of those dead and for the injured. For train accidents, the railway minister also announces compensation. The prime minister loosens purse strings and adds to the money announced for the next of kin of accident victims. Monetary compensation and treatment are also promised for those injured. The Latin-origin terms “ex gratia” or “solatium” are seen only in such stories.Understanding “ex gratia” compensationThe Oxford dictionary defines ex gratia as “a payment made as a favour or from a sense of moral obligation rather than because of any legal requirement”. Read that again, slowly and carefully. Why would our governments be paying accident victims as a favour? What place does a sense of moral obligation have in a democracy where we are not ruled by kings, benevolent or otherwise, but elect our representatives and have processes that make our government answerable to us?Is the sin of repeated and frequent failure of governments in ensuring safety washed away because it feels morally obliged to compensate the victims? And is the ex gratia fair and adequate?Governments pays woefully inadequate amountsWhen a tragic accident occurs and the government rushes in with immediate ex gratia relief, it can be tempting to interpret positively the urgent compensation to the aggrieved, that too from a State that usually imposes significant delays for money it owes citizens. This temptation must be resisted, because ex gratia is arbitrary, inadequate and seldom well-administered.Twenty years ago, the Maharashtra government announced an ex gratia of Rs 2 lakh to the kin of the 41 people who lost their lives in the Kumbh Mela stampede in Nashik. Nearly 20 years later, the government of Andhra Pradesh announced the same amount for the kin of those who died in a stampede at a Telugu Desam Party roadshow in Nellore, Andhra Pradesh (the Union government additionally announced Rs 2 lakh per victim).We performed online searches to determine if there were patterns to the promised amount of ex gratia compensation across the country. In almost every state, the amounts appear to have been frozen at some point in time and not revised for multiple years.Maharashtra chief ministers over the past decade have been consistent in announcing a sum Rs 5 lakh, irrespective of the incident type. The Mantralaya fire of 2012 in Maharashtra claimed five lives; the then chief minister announced Rs 25 lakh as compensation. For each of the 20+ accidents in Maharashtra from 2013 onwards that we were able to document, the chief minister (irrespective of the ruling party) announced Rs 5 lakh ex gratia to the next of kin of those who died.In Tamil Nadu over the same period, the ex gratia from the chief minister ranged between Rs 2 lakh to Rs 5 lakh over 30+ incidents, with two exceptions – Rs 10 lakh announced for the 17 deceased in a wall collapse in Mettupalayam in December 2018 and for three school students who died in a wall collapse in in Thirunelveli in December 2021. A smaller sample of ~3-5 accidents each in Andhra Pradesh, Gujarat, Jammu and Kashmir, Karnataka, Madhya Pradesh, Punjab, Rajasthan, Telangana, Uttar Pradesh and West Bengal failed to turn up compensation more than Rs 5 lakh, except for incidents involving the armed forces or industrial accidents (gas leaks in Vishakhapatnam and Ludhiana). For larger incidents, the prime minister stepped in with an additional compensation of Rs 2 lakh. All of these are less than the Rs 10 lakh insurance cover that passengers can buy when purchasing a train ticket.At the current minimum wage of Rs 178 per day, a person that works 25 days in a month would earn Rs. 53,400 a year. For contrast, note that the benefits under reservation for economically weaker sections (EWSs) of society are for persons whose family has gross annual income below Rs 8 lakh! The default compensation range of Rs 2-5 lakh barely represents a few years of minimum wage work, let alone accounting for the productive capacities of those who lose their lives, or take into account the family circumstances where the deceased may be a primary wage earner.No sound basis for amount paid under ex gratiaEach time an accident occurs, the ruling establishment of the state as represented by the chief minister or another minister unfailingly expresses deep grief and declares ex gratia as a measure of relief. Yet, no critical thinking or evaluation of individual circumstances is ever performed. The state government simply pays a pre-set amount of compensation for almost all incidents, as if the state bureaucracy follows a set procedure, with a hardcoded compensation amount.A simple inflation calculation shows that to have the same purchasing power as Rs 5 lakh in 2013, one would need to spend Rs. 9.51 lakh as of 2023; yet, the governments have not made any adjustments to the compensation amounts over the last several years. It is as if the machinery that extends favours is choosing to ignore the phenomenon of inflation.There is also arbitrariness in the compensation announced – different states have different standards, and the same state promises different amounts seemingly based on the size of headline or the suggestion of a court.The June 2023 train accident in Balasore had victims that belonged to different states. While Indian Railways announced Rs 10 lakh to the families of those deceased, each state followed its own default – Odisha and Bengal announced Rs 5 lakh, Bihar announced Rs 2 lakh and Andhra Pradesh announced Rs 10 lakh. While equality before law is guaranteed by the Constitution, such differences in favours based on whether the person is Odia, Bengali, Bihari or Telugu lay bare the casual way in which the State discriminates between citizens.Inconsistencies are seen even within the same state. On November 21, 2022, just six months prior to the Balasore accident, a freight train derailed at the Korei station in Odisha, killing three people. The same railway minister, Ashwini Vaishnaw, had then announced an ex-gratia of Rs 5 lakh for the kin of the deceased in addition to the Rs 2 lakh announced by the same chief minister, Naveen Patnaik. Two similar accidents in the same state, within a few months of each other. In the deadly Morbi bridge accident, the Gujarat chief minister initially announced the default Rs 4 lakh, adding on another Rs 4 lakh based on a suggestion by the Gujarat high court.DateType and location of accidentNumber of deathsCompensation (CM)Compensation (PM)Compensation (Other)1 July 2023Bus accident, Buldhana, Maharashtra255 lakhs2 lakhs2 June 2023Train accident, Balasore, Odisha~300Odisha, Bengal: 5L;Bihar: 2L; CM Andhra Pradesh: 10L.2 lakhsRailways: 10L9 May 2023Bus accident, Khargone, Madhya Pradesh224 lakhs2 lakhs7 May 2023Boat accident, Malppuram, Kerala2210 lakhs2 lakhs15 Apr 2023Bus accident, Raigad, Maharashtra135 lakhs2 lakhs30 Mar 2023Temple slab collapse, Indore, Madhya Pradesh365 lakhs2 lakhs25 Feb 2023Bus accident, Rewa-Satna border, Madhya Pradesh1410 lakhs21 Dec 2022School bus accident, Noney, Manipur105 lakhs2 lakhs30 Oct 2022Bridge collapse, Morbi, Gujarat135originally 4L, 4L added later2 lakhsBut how can one put a value on a human life?There is simply no way to put a value on a human life; after all, the grief and devastation caused is personal and direct for every family, and plays out differently. This however should not be an excuse for inaction. The goal of a compensation mechanism should be to replace at least a threshold percentage of the future wages (or equivalent contributions to the family) of the deceased so that the accident doesn’t end up leading to economic devastation for the family.There are legitimate and accepted ways to determine this amount. Economists have standard models that forecast future earnings. Historical wage trends for different professions can be input into these models. Individual circumstances such as age, education, profession, family circumstances, etc. can be taken into account. Using a consistent and transparent methodology can produce reliable estimates that reduce discrimination, although admittedly this can never be perfect. This is the standard in many parts of the world – accident victims can bring tort claims (“tortious interference”) against parties that are responsible for the accident. Courts and arbitrators then rely on economists to determine the compensation that is to be paid. These amounts will inevitably be higher than the pre-set “favour” the government extends through compensation.Ex gratia compensation serves to absolve governments of their responsibilitiesThe inability to bring tort claims and the absence of class-action litigation (where victims in the same circumstance can bring a case as a group) in India simply serves to exempt the government and its arms (the Indian Railways, state transport corporations, road transport officers that issue vehicle and driving permits, factory and building inspectors, etc.) from being charged with neglect that leads to accidents. In the Balasore case, the Commissioner of Railway Safety has held the signalling and operations staff jointly responsible. While the axe may fall on individual staff members, systemic issues remain unaddressed – as of June 2023, the Indian Railways had 1.78 lakh posts unfilled in the safety category.Moreover, even when claims are brought under other laws, the delays and costs of our court systems deter all but the most dogged of victims from bringing lawsuits. The story of India’s biggest industrial disaster – the Bhopal gas leak, the inadequate compensation, and the futile multi-decade litigation – is illustrative in this regard.Forcing transport operators, temple trusts, building contractors and other entities, whether government or privately controlled, to pay out damages that reflect the future economic contributions of the deceased and injured, with added penalties for faults in implementing safety protocols, designing for safety, etc. creates incentives for improving safety standards. Unless this is done, we’ll continue to see accidents happen, grief expressed by governments, inadequate compensation announced, and no actual action to prevent accidents.Favours are arbitrary, to be issued as and when a ruler pleases. They have no place in a modern democracy. We must demand accountability and action from our elected representatives to make compensation a reality and create incentives to fix for improving safety standards.Megha Kajale is a student at the Gokhale Institute of Politics and Economics and Mihir Mahajan is adjunct fellow, Takshashila Institution.
