Don’t oversell direct cash transfer scheme, PM tells Ministers

A fortnight short of the United Progressive Alliance government rolling out the first phase of the direct cash transfer scheme on January 1 in 43 districts, Prime Minister Manmohan Singh, highly placed sources said, cautioned the 16 Ministers gathered at a review meeting here on Tuesday not to raise expectations or oversell the programme till they were absolutely sure that it could be effectively implemented.

This comes in the wake of the build-up the Congress has given to the programme, through two highly publicised press conferences, the most recent on December 14, following a meeting of district Congress chiefs called by party general secretary Rahul Gandhi to educate them on the significance of the scheme.

At this press conference at the Congress headquarters, addressed by Rural Development Minister Jairam Ramesh and party general secretary Janardan Dwivedi, the programme — now rechristened direct benefits transfer — was billed as the party’s centrepiece for 2014, just as the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) was in 2009.

Aap ka paisa, aapke haath (your money in your hands), it was emphasised, will be the Congress’ political slogan in the general elections, just 17 months away.

But on Tuesday night, at the second meeting of the National Committee on Direct Transfers, what emerged was that the state of preparedness in the 43 districts where 34 existing welfare schemes — including scholarships, pensions, MGNREGA wages etc, which are cash-based currently also — are to be brought on to the Aadhaar platform, was uneven. Therefore, to announce a “rollout” before all those on the list of beneficiaries in these districts had Aadhaar numbers linked to a bank account might create a backlash, it was felt.

The gathered Ministers were told that there should be no phased roll-out within any particular district; the entire district should switch to direct cash transfer at one-go on a given date. For a district to launch the programme, 95 per cent of the beneficiaries should have Aadhaar cards and bank accounts linked to them.

It is, therefore, unlikely that cash transfers will start simultaneously in all 43 districts: sources said 35 districts could commence on January 1, and another eight by January 10.

Also, it is possible that not all 34 schemes will be implemented through this method in all the selected districts. Indeed, a government source was at pains to say that what will commence on January 1 should be viewed more as “a pilot project” rather than as a “rollout.”

Meanwhile, over the next few days, there would be a series of top-level meetings here to review the state of preparedness in the selected districts, government sources said adding that a more definite, detailed and realistic timeline for the direct benefits programme was likely to be announced next week. This comes even as the government is according priority to digitisation of beneficiary databases with names, addresses and Aadhaar numbers and linking them to bank accounts.

Dr. Singh has been cautious from the very start. At the first meeting of the National Committee on Direct Transfers on November 26, he said in his closing remarks: “The twin pillars for the success of the system of Direct Cash Transfers that we have envisioned are the Aadhaar Platform and Financial Inclusion. If either of these pillars is weak, it would endanger the success of the initiative.”

As the government moves closer to the next elections, it cannot afford a failure. Given that reports coming in from different parts of the country on existing pilot projects have been dismal, there is clearly need for caution.