MP: PDS leakages cost public exchequer Rs 1,428 cr, govt disputes survey claim

  • Ranjan, Hindustan Times, Bhopal
  • Updated: Mar 02, 2015 18:06 IST

Economic Survey of India 2014-15 has put a spotlight on leakages in the public distribution system of Madhya Pradesh. The survey, released on Friday, revealed that the leakages cost the public exchequer an estimated Rs 1,428 crore.

Leakages in the PDS have been a common phenomenon across the state forcing the state government to take several measures such as GPS fitted in transport vehicles carrying the essential commodities to the fair price shops, food coupons distributed among beneficiaries and computerisation of the distribution system.

There are about 22,000 fair price shops under the PDS.

As per the report, which is available on the Union government’s website, the estimated leakages in the PDS accounted for about 51% (11.54 lakh tonne) of the total allocation of food grains and thus the estimated fiscal cost stood at Rs 1,428 crore.

In terms of financial loss, Madhya Pradesh stands at 4th position in the chart after Uttar Pradesh (Rs 3,727 crore), West Bengal (Rs 1,864 crore) and Rajasthan (Rs 1,495 crore).

However, the state government disputes the claim made in the survey.

“First, the survey is based on allocation in 2011-12. Second, the survey is based on a report which itself is disputed. In the last few years, the leakages have been extensively checked with digitisation of the records regarding distribution of commodities from fair price shops in the state,” said principal secretary, food and civil supply and consumer protection, Ashok Kumar Varnwal.

As per the economic survey, the excess allocations were computed as the difference between PDS allocation and PDS consumption. Similarly, the financial cost was calculated by multiplying the per quintal subsidy (Rs 1,237 for wheat and Rs 1,619 for rice) by the total excess allocation.

The report states, “Our proposed allocation is calculated by scaling up the 2011-12 PDS consumption as per NSS (National Sample Survey) by 25 percent.” The survey says, “Leakages are big and present in most states, and that they are significantly bigger for wheat (54%) than for rice (15%). The fiscal cost of these leakages is also big - about Rs 5,800 crore for PDS rice and Rs 12,600 crore for PDS wheat (in the entire country).

Varnwal said since the leakages were mostly related to above poverty line (APL) distribution of commodities and the APL had been done away with, leakages were “greatly” checked now. “What remains would be checked with establishment of a point of sale machine at every fair price shop,” he added.

Right to Food activist Sachin Jain too feels the government has intervened to check leakages but, he says, until and unless there is an independent consumer grievances redressal mechanism in the state, a state food commission and also community monitoring at every level, such leakages were difficult to check. He said irony was that redressal of grievances was in the hands of those who were responsible for the leakages.

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