Revised draft of food bill gives primacy to cash transfers, coupons

Social activists up in arms against proposed reforms; impact on procurement feared

November 24, 2011 01:27 am | Updated November 17, 2021 01:30 am IST - NEW DELHI:

The government's new move to give primacy in the revised draft of the National Food Security Bill, 2011, to controversial schemes like cash transfers and issuance of food coupons to identified public distribution system beneficiaries in lieu of foodgrain entitlements has got social activists up in arms.

The scheme was introduced under ‘Schedule II' in the initial draft of the Bill that was posted on the Food Ministry's website for public comments. It has now been inserted into the main body of the revised draft, as a whole new chapter (VII) linked to reforms in the public distribution system, giving a clear indication that the government is moving towards it.

Activist Biraj Patnaik termed it as “ridiculous'' and said in a country that was high on gender inequality, where the rural banking system was in shambles and direct cash transfers in old-age, widow and disabled pension schemes had not been streamlined, this would adversely impact food procurement and minimum support price to farmers if beneficiaries were to buy supplies from the open market.

“The world over it is known that food is in the hands of women but cash is controlled by men who have different priorities on how to spend it.''

Explained Minister of State (Independent) for Food and Public Distribution K.V. Thomas: “We are not in favour of cash transfers. This has been included as part of the law so that there is no dispute on that later. It is a progressive reform.''

The reforms chapter also calls for leveraging ‘aadhaar' for unique identification, with biometric information of entitled beneficiaries for proper targeting of benefits under the proposed Act linked to progressive reforms in the Targeted Public Distribution System.

Deputy Chairman of the Planning Commission Montek Singh Ahluwalia has been most vociferous about both the ideas in public meetings.

The Bill, that calls for foodgrain entitlements at subsidised rates to up to 75 per cent of identified rural households and 50 per cent of urban families, lays much stress on “cost sharing'' between the Centre and the States. It provides that not less than 46 per cent of rural and 28 per cent of urban households shall be designated as priority households. The survey to identify the beneficiaries is underway by the Ministry of Rural Development.

The financial implication of providing subsidised foodgrains under law is estimated at nearly Rs. one lakh crore, which would be approximately Rs. 30,000 crore higher than the current food subsidy of around Rs. 70,000 crore.

In addition, the revised draft provides for an expenditure of about Rs. 12,000 crore towards maternity benefit of Rs. 1000 per month for six months to pregnant and lactating mothers, which number was estimated at around 2.25 crore in 2010 under the Integrated Child Development Scheme. The cost of providing free (or at affordable price of estimated Rs. 10 per meal) is estimated to be around Rs. 9000 crore to five per cent of the priority population.

Besides this, the Ministry of Agriculture and Cooperation has projected an expenditure of over Rs. 1,00,000 crore towards incremental production of 20 to 25 million tonnes of foodgrains.

The Centre and States shall have to put in place an “internal grievance redress mechanism'' including call centres, help lines, nodal officers and so on before a complaint is taken to the District Grievance Redress Officer or higher level.

The revised draft has been approved by Pranab Mukherjee as chairman of the Empowered Group of Ministers. It has now been circulated to related departments and will be put to the Union Cabinet for approval. “The Bill is expected to be introduced in Parliament by mid-December,'' Mr. Thomas indicated.

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