In 2005, another expert group to review methodology for poverty estimation, chaired by Suresh Tendulkar, was constituted by the Planning Commission. The reason for formulation of committee was :
- Issues with the adjustment of prices for inflation, both spatially and temporally.
- Earlier poverty line assumed that health and education would be provided by the state and formulated poverty lines accordingly.
- Consumption patterns were linked to the 1973-1974 poverty line Basket of goods and services, where as there were significant changes in the consumption pattern of the poor since that time, which were not reflected by the poverty estimates.
Recommendation of the Tendulkar Committee:
It was a shift away from calorie based poverty estimation. It suggested uniform poverty line basket across rural and urban India. A change in the price adjustment procedure to correct spatial and temporal issue with price adjustment. There was the recommendation to include private expenditure on health and education while estimating poverty.
