Canteens vs PDS: The jury is still out on food subsidy
State-run canteens raise many troubling questions that need to be answered. It is important to realise that the subsidy road is a strictly one way route and once brought in, it is very difficult to step back and say let us do it some other wayUpdated: Aug 20, 2017 21:20 IST
Food subsidy in India has literally moved along the value chain. While the Public Distribution System (PDS) has remained a pillar for providing subsidised food, the latest pier is about prepared food. From farm to fork has now become from anywhere to a café. Amma canteen, the avant-garde route of food subsidy started by late Tamil Nadu chief minister J Jayalalithaa is now seen as the beacon for providing cheap food and state after state have joined the race. Odisha has a scheme called Aahaar, Madhya Pradesh has Deendayal Rasoi and forthcoming in Uttar Pradesh is Annapurna Bhojnalaya. Recently, Congress vice president Rahul Gandhi announced the launch of Indira canteens across Bengaluru for poor labourers and migrants.
Where does this subsidy contest go from here? Leaving aside the safety net element of this, the jury will be out on the political dividends from expanding the nodes of food subsidy. In the subsidy race, benchmarking can be a bane for the low performers. How many remember the improvements in PDS over and above poster boys such as Chhattisgarh and Tamil Nadu? Moreover, the economics of these schemes are still not clear or researched. The PDS has remained the holy grail despite widespread and endemic problems and significant fiscal burdens; similarly, the costs of these schemes can also spiral out of control. Are these schemes substitutes or complements to the PDS? What happens if the system moves towards a direct benefit transfer? It is important to realise that the subsidy road is a strictly one-way route and once brought in, it is difficult to step back and say let us do it some other way.
A first order policy question is: With the mushrooming of these food canteens as a parallel system, will it stifle the evolving changes across states to strengthen the PDS or experiment with new delivery mechanisms? The opportunity cost of these schemes could very well be higher than realised. How these schemes undo or diminish cleaning and strengthening of the existing systems could very well be the latent cost here.
In our research, surveys in Odisha have showed the suppressive role of schemes such as Aaahar towards the PDS. Beneficiaries in Odisha seemed apathetic towards the suboptimal rice being provided for in the PDS. When quizzed, one of the reasons cited was the Aaahar buffer that provided for cooked meals at a subsidised rate. “Why bother about complaining about poor quality of rice, when we have ready-made food available in these canteens”, they opined.
Also, as the subsidy moves along the value chain, it is pertinent to assess what it means for the elaborate procurement system of grains feeding the PDS? The canteen programmes will scale up because of the money and time it saves, and it is convenient. How this system is provided for and the implications it has for backend are critical issues to address. Will the system distort the production choices more towards cereals? Will food safety and nutrition be preserved particularly in cases where institutions are weak? The records on the mid-day meal scheme, contextually a similar programme, in terms of these attributes have been far from encouraging. Notwithstanding the smartness from a political standpoint, the big-ticket question is: Do we need yet another scheme while we are struggling to fix the long-serving ones like the PDS? Do we need another food subsidy pulley or grease the existing one well?
Mamata Pradhan is doctoral scholar, University of East Anglia, and Devesh Roy is research fellow, International Food Policy Research Institute
The views expressed are personal
First Published: Aug 20, 2017 17:26 IST