PDS reform: Don’t give grains, transfer subsidy to poor, says panel

A government committee on reforming the public distribution system has decided that rather than foodgrains, the poor in India should get money in an electronic account every month and should have freedom to buy food of their choice from fair-price shops. Chetan Chauhan reports. See special

Updated on: Mar 25, 2011, 02:47:54 IST

Hindustan Times | By Chetan Chauhan, New Delhi

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A government committee on reforming the public distribution system has decided that rather than foodgrains, the poor in India should get money in an electronic account every month and should have freedom to buy food of their choice from fair-price shops.

The panel, headed by plan panel deputy chairperson Montek Singh Ahluwalia, is expected to recommend a methodology and roadmap for direct transfer of food subsidy to the government next week.

The committee has recommended that in the first week of every month, the government directly transfer the subsidy amount to a unique identification (UID) or Aadhaar number-linked smart card, to be in the name of a woman family member above 18 years of age.

The subsidy would be the difference between the minimum support price (MSP) for the foodgrain and the PDS shop issue price. This would mean a BPL family would get Rs 280-R300 under the existing PDS of 35 kg of foodgrain per family per month at Rs 5.50 for a kg of rice or Rs 4.15 for a kg of wheat.

If the National Advisory Council’s formulation of 35 kg at R1 for millets, Rs 2 for wheat and Rs 3 for rice is considered, the monthly subsidy would range between Rs 300-Rs 350.

“A BPL cardholder can either lift his or her quota of subsidised foodgrains or will have the choice to buy any other food stuff...” said a panel member.

The card will function only at fair-price shops, thus preventing withdrawal of money.

Ahluwalia said, “...Giving choice to beneficiaries will empower them. It will also help plug leakages”. The Centre paid Rs 60,600 crore as food subsidy in 2010-11 for PDS.

The committee has suggested the proposed National Food Security Act allow electronic transfer of food subsidy with a provision for food subsidy to be a percentage of MSP.

The committee is silent on who should be covered under the regime though plan panel member Abhijit Sen wants universalisation of PDS.

“The NAC and government are deliberating on the issue,” the source said.

ABOUT THE AUTHOR
Chetan Chauhan
Chetan Chauhan is the National Affairs Editor looking into all aspects of news and features from across India. A Chevening scholar with over three decades of experience in reporting and news management, Chetan has extensively covered all important aspects of the social sector, political economy, environment and climate change nationally and internationally. He did a journalism course at the Reuters Institute of Journalism in Oxford and Digital Media training at Nanyang Technological University in Singapore. He started as a reporter with The Statesman in 1996 and joined the Hindustan Times in 2000 in the metro bureau covering environment, crime and Delhi politics. He covered hot local news, from the Jessica Lal murder case to the rebellion of Delhi Congress MLAs against then Chief Minister Sheila Dikshit, to the replacement of toxic vehicle fuel with cleaner compressed natural gas (CNG) in the national capital. Some of his stories on air pollution became part of the Supreme Court’s landmark MC Mehta versus Government of India case in the National Capital Region (NCR), forcing the government to take corrective measures. As part of the national political bureau since 2004, he covered important central sectors such as environment, education, social justice, labour, rural development, water resources, renewable energy, agriculture, broadcasting and the Planning Commission for more than a decade producing several exclusive and investigative breaking stories. His specialisation is the environment, having covered at least a dozen United Nations global conferences on climate change, biodiversity and wildlife including climate summits in Paris, Copenhagen and Bali. He also covered India’s two five-year plans ---11th and 12th and reported on drafting and execution of right based laws such as Right to Education, Right to Information and rural job guarantee law, MG-NREGA, now being introduced in new format as VG-RAM-G Act. He has in-depth knowledge of social sector issues. He was one of the first to report on tigers vanishing from Sariska and Panna wildlife reserves in 2004 and 2008, respectively, leading to the setting up of the National Tiger Conservation Authority (NTCA) and the introduction of stringent penal provisions for poaching. He has written extensively on the rising human-animal conflict in India and the degradation of India’s biodiversity hotspots because of mining and other activities. Since 2004, Chetan has covered Parliament comprehensively and participated in training on the nuanced coverage of Parliament proceedings. He has travelled extensively across India to cover national and provincial elections since 1998, especially in the Hindi heartland states, considered India’s road to power. He writes a regular column for Hindustan Times, Ecostani, on important national politics, economy, Himalayan ecology and environmental issues. His other responsibilities include providing inputs for edits and edit page articles for the publication, apart from managing news flow from across India.Read More

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