Families across Maharashtra will lose their cooking gas subsidy by next March if they do not have bank accounts linked to Aadhaar numbers, the State government has announced. The move has provoked widespread criticism from those who fear it will exclude hundreds of poor households from this much-needed benefit.
The market price of cooking gas is around Rs. 950 to Rs. 1,000 a cylinder. Households are entitled to nine discounted cylinders each year which cost Rs. 450 each.
Once the Aadhaar-LPG scheme became mandatory, families would not get discounted cylinders. Instead, the subsidy would be transferred directly into their bank accounts. To get the benefit, however, people would have to get Aadhaar number, link it to their bank account and also to their consumer number at the LPG agency, officials said.
The scheme to dispense unique identification numbers to citizens across the country was flagged off in Maharashtra’s Nandurbar district in September 2010. With 7.3 crore enrolments so far, the State has covered 65 per cent of its population and ranks second in the country after Andhra Pradesh.
Officials say the Aadhaar number will help weed out duplicate or ghost beneficiaries of welfare schemes.
“The direct cash transfer will ensure that subsidies reach the real beneficiary and are not diverted,” adds Information Technology secretary Rajesh Agarwal.
But critics say there is a wide gap between official rhetoric and reality.
“The government talks about its enrolment figures. But even after enrolment, it takes 6-8 months to generate the Aadhaar number. A large number of poor families do not have bank accounts, which will take time to open. And then the account has to be linked to the LPG registration number, a process called seeding. Implementing this hastily will mean that many poor families will get excluded from this benefit and it will cause a lot of hardship,” said R. Ramakumar, assistant professor from the Tata Institute of Social Sciences.
So far the scheme is mandatory only in Wardha district where officials say the bulk of the population has been enrolled. Yet, activists say even here the problems are immense. Officials say 80 per cent of the population has been enrolled. What about remaining per cent — that is a very large number of people left out,” said Kiran Moghe of the All India Democratic Women’s Association, who recently visited Wardha.
In many cases, people had applied for Aadhaar numbers and not received them, she said. Also, the process of linking it to bank accounts and LPG numbers was done haphazardly and remained incomplete, she added. Until the linkage is complete, the subsidy will not be delivered.
“Those who suffer the most are the poor — labourers who lose out on wages by standing in queues,” Ms. Moghe pointed out. Even if all goes well, the cash subsidy would reach the bank account much after the gas cylinder was purchased. “That means people will have to pay Rs. 1,000 — the market price for a cylinder outright. How will the poor be able to afford it?” she said.
Officials said each district was given a three-month grace period to get things in order.
“We will ensure that genuine beneficiaries are not excluded. The scheme is being implementing keeping in mind that 80 per cent of each district will be enrolled by then. Also, Reserve Bank of India has issued a directive to banks that they should open accounts for all Aadhaar-holders. So those who don’t currently have bank accounts will not be left out,” said Mr. Agarwal.
However, Ms. Moghe said banks were not following the spirit of the directive. “RBI told banks to open a no-frills account, but they are insisting on an opening deposit, which is not possible for the poor.”
Critics are questioning the State’s right to make the Aadhaar number mandatory.
“The Aadhaar card was meant to be voluntary. Why is it being made compulsory,” asked Mr. Ramakumar.
He pointed out that a Parliamentary Standing Committee had rejected a bill that proposed making the Unique Identification Authority of India, which is overseeing the project, into a statutory authority.