Transfer of assorted subsidies and sops to the beneficiaries through the direct benefit transfer (DBT) resulted in gains of `50,125 crore in FY21, taking the Centre’s savings due to plugging of leakages to Rs 2.73 trillion between FY15 and FY21, according to a revised estimate by the government.
Such savings — both cash and in-kind – stood at Rs 2.23 trillion up to FY20.
The DBT-induced savings are giving the managers of government finances significant relief, to improve the quality of spending and offering benefits to the deserving beneficiaries, given the government’s focus on accelerating capital expenditure by containing revenue spending.
To put this in a perspective, the DBT-enabled savings in the FY15-FY21 period are slightly higher than the Centre’s expenditure on higher education during the three years through FY23 or about 40% higher than Rs 1.97 trillion earmarked for Production Linked Incentive (PLI) schemes for 14 sectors in ten years through 2030.
Thanks to the implementation of additional welfare measures to give succour to people affected by Covid-19, DBT transfers rose 45% to Rs 5.53 trillion in FY21. Between FY14 (when the DBT scheme was launched) and FY21, close to Rs 16.38 trillion had been transferred to the beneficiaries via cash paid to their bank accounts and as in-kind benefits. The DBT transfers have since gone up to `28.85 trillion up to March 2023. The DBT transfers were at Rs 6.2 trillion in FY23, a tad lower than Rs 6.3 trillion in FY22.
The jump in DBT is largely attributed to the increased use of Aadhaar-enabled DBT platforms for most of the flagship welfare schemes.
Out of the cumulative DBT-enabled gains of Rs 2.73 trillion, weeding out of 42 million fake ration cards under the public distribution system for food grains helped in saving Rs 1.35 trillion (50% of the total). Removal of 41.1 million fake beneficiaries under LPG-Pahal scheme helped in savings to the tune of Rs 72,910 crore (27%). Among others, the deletion of duplicate beneficiaries under the job guarantee scheme (MGNREGS) yielded gains of `40,987 crore (15%) and `18,700 crore (7%) due to a reduction in the sale of subsidised fertiliser.
In FY23, the DBT benefits to the tune of Rs 2.06 trillion were provided to farmers by way of subsidized fertiliser, an annual increase of 66% on year. However, there was a decline of 25% in the value of subsidised food grains distribution to beneficiaries at Rs 1.64 trillion in FY23, partly due to the discontinuation of the free ration scheme in Q4. Among others, Pradhan Mantri Awas Yojana (Gramin) beneficiaries got Rs 44,308 crore in FY23, an annual increase of 11%.
The total of DBT beneficiaries stood at 1.62 billion (many people get multiple scheme benefits) in FY23, a decline of 9.5% on the year. The total beneficiaries of all schemes were at an all-time high of 1.8 billion in FY21 when the government rolled out several schemes to give relief to the poor from the impact of the Covid pandemic. The total number of schemes stood at 312 in FY23 including 264 cash schemes.