The government is talking of bringing in a National Food Security Bill, whereby every family below the poverty line (BPL) will be entitled to 25kg of grains per month at a rate of Rs3 a kg. This is a bold step towards right to food for the poor.
The key challenge is not just passing the Bill, but making sure it is implemented in a manner by which this subsidized food reaches the needy. Politically as well as economically, it can prove to be a master stroke abolishing hunger in one go. It can surely catapult the fortunes of the Congress party, and also raise India’s credibility among nations, if we do it right.
What are the various options with the government to implement it right? If the government uses the public distribution system (PDS), there is no way that hunger will go away from this land even in the next 10 years or so.
The reason is that the existing PDS, with a network of at least 400,000 fair price shops, suffers from large leakages. The Planning Commission’s study of 2005 shows that roughly 58% of grains issued from the PDS do not reach BPL families due to problems ranging from targeting errors to corruption all along the chain.
There is also a problem in defining and identifying a BPL family. While the Planning Commission puts the number of BPL families at 65.9 million, based on its 1993-94 poverty line and population of 2000, in reality the total number of BPL cards issued by states is 107 million. And if the plan panel’s criterion is updated with the poverty of 2004-05, and population of 2009, the BPL families will be just 60 million.
Which of these BPL families, 60 million or 66 million or 107 million, will be covered in the Bill can have huge implications in terms of cost.
And yet, the real poor may remain out of this net. It is well known that the access of poor people to PDS is much better in Tamil Nadu, Andhra Pradesh and Kerala, but where poverty looms large, such as in Uttar Pradesh, Bihar, Jharkhand, Orissa and West Bengal, the performance of PDS is pathetic. This is a clear indication that things will not improve if we keep relying on the existing PDS for reaching out to BPL families under the new Bill.
It is perhaps time to change the implementation track, and do things differently. But how do we do it? The Wadhwa committee looked into the operations of PDS and recommended, in its report submitted in 2009, an end-to-end computerization of PDS operations, from procurement to distribution of grains.
It also suggested using radio frequency identification devices to track the movement of grains. This is considered critical to stop large-scale corruption and diversion. However, the report does not go into the criteria for identifying the poor, or thinking of some other ways of helping the poor.
Studies by the International Food Policy Research Institute in several countries shows that instead of physical handling of grains, conditional cash transfers to the poor, especially women, are much more cost-effective ways of helping the poor.
New technologies can be used to issue biometric cards to the poor for their entitlements through food vouchers. These food vouchers can be used to buy a number of food items from any grocery shop, who in turn can get these reimbursed from post offices or banks on a commission basis.
To identify the poor, one can combine high-tech methods with social audits. The criteria must be simple, and to the extent possible, foolproof. For example, one can say that all those who have a motorized vehicle, or a cellphone, or a land line with a minimum bill, or electricity connection with a minimum bill, or a job in the organized sector, etc., are not BPL.
All such people are registered at one place or another, and they can be marked as non-BPL families in the master computerized list. For the remaining families, there could be a social audit through village councils, with a clear sign on their houses that they are BPL families.
It may take a little time to do it, but it will go a long way in helping the real needy. Also, if done right, it can keep the budgetary implications of this Bill within limits of Rs20,000-25,000 crore, assuming the subsidy per kg of grain is Rs12, and BPL families do not number more than 70 million.
If not, the cost will be enormous, almost double of this amount, and hunger will still haunt India.
Ashok Gulati is director in Asia for International Food Policy Research Institute.
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