Bangalore, P M Raghunandan, July 29, 2014, DHNS:
The State government is working towards introducing its own version of Direct Benefit Transfer (DBT) based on bank accounts for supplying food grains under its flagship Anna Bhagya scheme (rice at Re 1 per kg), following the Supreme Court order not to use Aadhaar-based DBT for implementing beneficiary-oriented schemes.
The State Food and Civil Supplies department recently held the first round of meeting with representatives of nationalised banks, including State Bank of Mysore, Syndicate Bank and Canara Bank and discussed the plan. The aim is to plug the leakage in implementing the scheme, which is costing a whopping Rs 4,400 crore to the State exchequer every year.
Direct transfer
The State Food and Civil Supplies department recently held the first round of meeting with representatives of nationalised banks, including State Bank of Mysore, Syndicate Bank and Canara Bank and discussed the plan. The aim is to plug the leakage in implementing the scheme, which is costing a whopping Rs 4,400 crore to the State exchequer every year.
Direct transfer
Commissioner for Food and Civil Supplies Harsh Gupta said the plan is to make all Below Poverty Line (BPL) families eligible to avail the scheme open bank accounts.
The department would directly deposit the subsidy amount in the bank accounts of the BPL card holders on buying food grain by paying full cost of it at the fair price shops.
“All the lead banks have a mandate for ensuring financial inclusion in the State. We have requested the banks to make use of the area-wise BPL card database available with the department to open bank accounts, especially in rural areas. Bank accounts will be linked to BPL cards, enabling the department to transfer the subsidy amount every month.”
The department is supplying up to 30 kg rice to each of the 1.02 crore BPL card holders every month under the scheme.
The per capita expenditure on food subsidy is estimated at Rs 2,900 per annum. The department has not been able to do much to prevent misuse of the scheme due to the existence of a large number of bogus cards.
Bank-based DBT is expected to eliminate ‘ghost’ card holders. The department had earlier planned to adopt Aadhaar-based DBT for Anna Bhagya, but the apex court order last year spiked its plan.
The Commissioner said the bank account-based DBT plan is likely to be discussed at the State-Level Bankers’ Committee meeting scheduled to be held in Bangalore on August 6. If approved in the meeting, the banks have to obtain the permission of the Reserve Bank of India to join hands with the government to implement the scheme, he added.
Wait for approval
The department is awaiting the Union government’s nod to introduce the DBT for kerosene supply in Mysore, Tumkur and Hubli-Dharwad on a pilot basis. Every litre of kerosene carries a subsidy of Rs 50. The government supplies about 45,000 litres of subsidised kerosene to non-LPG BPL card holders every month.
The Union government bears the entire subsidy burden on kerosene.
The department would directly deposit the subsidy amount in the bank accounts of the BPL card holders on buying food grain by paying full cost of it at the fair price shops.
“All the lead banks have a mandate for ensuring financial inclusion in the State. We have requested the banks to make use of the area-wise BPL card database available with the department to open bank accounts, especially in rural areas. Bank accounts will be linked to BPL cards, enabling the department to transfer the subsidy amount every month.”
The department is supplying up to 30 kg rice to each of the 1.02 crore BPL card holders every month under the scheme.
The per capita expenditure on food subsidy is estimated at Rs 2,900 per annum. The department has not been able to do much to prevent misuse of the scheme due to the existence of a large number of bogus cards.
Bank-based DBT is expected to eliminate ‘ghost’ card holders. The department had earlier planned to adopt Aadhaar-based DBT for Anna Bhagya, but the apex court order last year spiked its plan.
The Commissioner said the bank account-based DBT plan is likely to be discussed at the State-Level Bankers’ Committee meeting scheduled to be held in Bangalore on August 6. If approved in the meeting, the banks have to obtain the permission of the Reserve Bank of India to join hands with the government to implement the scheme, he added.
Wait for approval
The department is awaiting the Union government’s nod to introduce the DBT for kerosene supply in Mysore, Tumkur and Hubli-Dharwad on a pilot basis. Every litre of kerosene carries a subsidy of Rs 50. The government supplies about 45,000 litres of subsidised kerosene to non-LPG BPL card holders every month.
The Union government bears the entire subsidy burden on kerosene.
