Kotkasim cash transfer flops as programme skips Aadhaar

Written by fe Bureau | New Delhi | Updated: Dec 14 2012, 09:08am hrs
Eighty-year-old Sampat Rai from Kotkasim a nondescript tehsil of Alwar in Rajasthan that was among the first off with direct cash transfer in kerosene subsidy was in Delhi on Thursday, joining a protest against the ambitious welfare plan.

In an area lacking proper transport, Rai must reach his bank located more than 6 km away to collect the cash. He claims that through the whole of last year, he received a meagre R90 in kerosene subsidy. It takes a whole day to visit the bank with his son, who must forgo a days wages for this purpose. His verdict: Simply not worth the trouble.

Kishan, who must travel 6-7 km to his bank, has a similar tale to tell. The bank, he says, wants him to maintain a minimum balance even though it is supposed to be a zero-balance account. He says that despite maintaining the balance with difficulty, he has not received any cash since the pilot started 12 months ago. Kishan and Rai are among Kotkasims hundreds told by the government to buy kerosene at full market price from fair price shops under the assurance that the subsidy would reach their accounts whenever they made the purchase.

Kotkasim started the experiment in December 2011. A year on, most people still dont have bank accounts. Even those with accounts do not trust the programme, since transfers are erratic.

As a result, most people have stopped buying from fair price shops, bringing the kerosene distribution system to a halt.

One of the main lessons from the experiment is that inappropriate cash transfers could play havoc with the public distribution system, said activists from the Right to Food Campaign, which held a protest in the Capital. Curiously, the Kotkasim pilot did not use Aadhaar to identify beneficiaries, even though the Prime Minister is on record that the national rollout will ride the unique ID programme.

The Kotkasim local administration used its own technology, said an official from the Unique Identification Authority of India (UIDAI), which has developed the platform for Aadhaar-enabled direct subsidy transfer.

The protest coincided with a Planning Commission meeting with collectors of the 43 districts. The panel was supposed to meet 51 collectors but it was reduced due to elections in Himachal Pradesh and Gujarat.