The rift between the government and the Sonia Gandhi-led National Advisory Council (NAC) on the food security law appears to have widened. The food ministry has categorically told the NAC at a meeting last week that it was in favour of cash subsidies to beneficiaries if enough grain was not available, a stance NAC has opposed in the past.
At a meeting with NAC last week, food minister KV Thomas made it clear that the government was clearly constrained over foodgrain procurement. Rather than upset the market by indiscriminate procurement, the government would prefer to disburse cash to the intended beneficiaries of the scheme. ?The food ministry also made it very clear that grain cannot be made available for just 50% of the minimum support price (MSP) as it would increase the subsidy burden greatly,? said a source in the ministry. According to officials, the subsidy burden will rise to R1,14,000 crore if the roll out of the food security Bill adheres to the parameters set by the NAC, something the government is keen to avoid. The food ministry in fact stayed close to the recommendations of the Rangarajan committee report, during the discussion, including rejecting dual pricing of foodgrain for below poverty line and general category households. On the near universal coverage recommended by the NAC, food ministry said it would skew the agri-procurement market. ?As of now, procurement is around 30%, if the government procures more we will have to consider the market impact of this,? said an official. The food ministry therefore has joined the ranks of deputy chairman of the planning commission Montek Singh Ahluwalia, and the chairman of the PMEAC C Rangarajan in urging caution on the scope of the Bill. The impasse over the Bill therefore continues as NAC members feel that the government is just making excuses for putting off the Bill. The next NAC meet is on Thursday