UID plan to cut bill by 33%

Despite bill cut, pilots sputter on take-off as new PDS scheme benefits fail to reach those without bank accounts; officials term it teething troubles. Chetan Chauhan reports.

Updated on: Nov 29, 2012, 01:59:32 IST

Hindustan Times | By Chetan Chauhan, New Delhi/Jaipur/Hyderabad

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The government has cited the twin benefits of achieving consumer satisfaction as well as subsidy savings to push the direct cash transfer before the next general elections, but civil society groups claim that many existing beneficiaries have been left out of the "game-changer" initiative.

Pilot projects that utilise the Aadhaar payment platform in East Godavari district of Andhra Pradesh and Alwar in Rajasthan have resulted a dramatic fall in off-take of subsidised products under the public distribution system (PDS). "It is because many beneficiaries don't have bank accounts or Aadhaar numbers," said Reetika Kheera of IIT Delhi, who conducted a study in Alwar.

In Alwar, kerosene sales fell by about 80% in the first six months of an Aadhaar-based pilot project. District civil supplies officer Ram Charan Meena claimed it was because kerosene was no longer being diverted to the black market.

"Earlier, kerosene was being diverted as an alternative to diesel, which is more expensive," he said, adding that the incentive of Rs 34 per litre of kerosene for diversion has ended because subsidy is being transferred into the bank accounts of beneficiaries instead of that of fair price shop owners.

A similar scenario was witnessed in East Godavari district, where the monthly sale of rice fell by around 20%, and kerosene by 30%. "Under the new system, people with fake ration cards cannot do much," said Babu V, joint collector, East Godavari, and pilot in-charge.

The Planning Commission has estimated this would cut the government's annual subsidy bill of Rs 3,20,000 crore by one-third. "More than savings, cash transfer will make the government delivery system more efficient," said Montek Singh Ahluwalia, deputy chairperson of the Planning Commission, which is one of the agencies tasked with bringing most government schemes under the Aadhaar umbrella by December 2013.

Babu, however, said the pilot has achieved higher satisfaction levels. Under the new system, beneficiaries can get all the subsidised items on their shopping list through a single visit to the fair price shop, and they get an SMS alert as soon as the articles arrive. Also, the new system reduced the possibility of ration pilferage.

However, National Advisory Council member Aruna Roy said that cash transfer will deprive the poor of essential services because it would be difficult to ensure that the money is used for the purpose it is given.

When asked for his comment, a UIDAI official termed them as "teething troubles" that were in the process of being resolved.

(Inputs from Ashok Das in Hyderabad and Urvashi Rawal in Jaipur)

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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