Good news: Centre’s food subsidy bill set to be slashed courtesy Aadhaar, PoS

By: | Published: September 6, 2017 5:37 AM

Haryana cuts 25%, Rajasthan a fifth; ePoS-enabled fair price shops, Aadhaar-seeding of cards help.

Food subsidy, centre, National Food Security ActRajasthan had reported a similar weeding out of fictitious beneficiaries under the National Food Security Act. (Reuters)

The new systems for monitoring transactions at fair price shops (FPSs) are promising to help slash the Centre’s food subsidy bill, the most sticky among its revenue expenditures, after pension and interest payments. Around a quarter of ration card holders in Haryana haven’t apparently turned up for collecting the provisions since June, when all 9,500 FPSs in the state started using electronic point of sale (ePoS) machines and Aadhaar-seeding of ration cards was made mandatory.

The state government believes that the sudden drop in the number of buyers is due to ePoS-induced transparency, which curtailed the scope for manipulation of purchase records and diversion of grains meant for the public distribution system (PDS) to the open market.

Earlier, Rajasthan had reported a similar weeding out of fictitious beneficiaries under the National Food Security Act (NFSA): After the state’s 25,000 odd FPSs were ePoS-enabled in September last year, the beneficiary list got pruned by about 20%.

The Centre’s food subsidy bill is projected to be Rs 1.45 lakh crore in FY18, under the medium-term expenditure framework released by the finance ministry recently, and the subsidy is seen to rise to Rs 2 lakh crore in FY20.

According to SS Prasad, additional chief secretary, Haryana, who heads the state’s Food Civil Supplies Department, after the state government stopped providing monthly entitlement of grains to around 40 lakh PDS beneficiaries among the 1.24 crore people covered under NFSA in June, around 10 lakh got their Aadhaar cards made and seeded with ration cards while others haven’t since turned up at the retail shops.

Against a monthly allocation of around 66,000 tonnes of wheat from Food Corporation of India for distribution to NFSA beneficiaries, the Haryana Civil Supplies Corporation is now lifting around 50,000 tonnes of grain mainly because of the reduction in the number of beneficiaries.

Of course, death, migrant labourers going back to their respective states, persons shifting out of the state after marriage, etc, prune the PDS list. “Compulsory Aadhaar seeding has made fake ration cards redundant,” Prasad said. The Haryana government has also introduced ‘portability’ of ration cards where each beneficiary can claim 5 kg of highly subsidised wheat as monthly entitlement under NFSA across any ration shop in the state.

Haryana has 29.68 lakh ration card holders of whom more than 90% so far have had their cards seeded with Aadhaar. Those who have not seeded their ration cards have been allowed to approach any FPS in the state to submit their details.

Haryana is one of six states to have installed e-PoS machines in all FPSs, the other five being Madhya Pradesh, Tamil Nadu, Andhra Pradesh, Chhattisgarh and Rajasthan. In coming months, these and other states are also expected to get rid of the redundant ration cards through Aadhaar-seeded PDS transactions and e-PoS-enabled tracking.

The government wants to make Aadhaar mandatory for receiving subsidised foodgrains under PDS, but what the Supreme Court says on this after the recent judgment making privacy a fundamental right is crucial.

Since 2013, 2.48 crore bogus/duplicate ration cards have been eliminated in the country, with potential savings of Rs 14,000 crore to the exchequer. Of a total 5.27 lakh FPSs in the country, around 47% or 2.45 lakh have installed ePoS machines. Around 80% of the total 23 crore ration cards in the country have been seeded with Aadhaar.

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