PM delivers a game changer

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Manmohan Singh, Prime Minister Manmohan Singh, Prime Minister
SummaryCome January, the eligible population in 51 districts will receive cooking gas, kerosene and food subsidies in cash in their bank accounts, apart from pension and wages under the rural job guarantee scheme.

payments to the targeted users.

APB is a repository of Aadhaar or unique identification number of residents and their primary bank account number used for receiving all entitlement payments from various government agencies. It facilitates seamless transfer of all welfare scheme payments to beneficiary residents’ Aadhaar-enabled bank account (AEBA). APB requires using the Aadhaar number as the primary key for all entitlement payments, thereby weeding out all ghosts and ensuring that the benefits reach the intended beneficiaries.

The government has pegged its subsidy outgo on food, fuel and fertiliser for the 2012-13 fiscal at over Rs 1.79 lakh crore, but this figure is evidently a gross underestimate, given that under-recoveries of oil marketing companies, a great part of which has to be met with budgeted subsidies, are alone pegged at Rs1.67 lakh crore against the budgeted petroleum subsidy of Rs 43,580 crore. The fertiliser subsidy is now expected to be at least 40% higher than the budgeted Rs 60,974 crore.

Although the government has budgeted the food subsidy bill at Rs 75,000 crore for 2012-13, sources said the burden could well cross Rs 1 lakh crore thanks to a 16% hike in the procurement price of paddy even if the wheat procurement price is kept unchanged at last year’s level. The food subsidy bill could drive up the government’s annual food subsidy bill to Rs 1,19,000 crore. Substantial savings in these subsidies are aimed to be achieved through the cash transfer scheme from 2013-14 onwards.

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