2858 - Aadhar-linked norm may be relaxed

Aadhar-linked norm may be relaxed

TUESDAY, 11 DECEMBER 2012 21:34 SANTOSH NARAYAN | RANCHI

The Centre’s ‘game changer’ plan to deposit subsidy directly into beneficiaries’ accounts linked with Aadhar numbers may see subtle modification in Jharkhand, at least for the initial period.

The beneficiaries of four districts selected in the State would be able to get money in their bank accounts without having themselves necessarily enrolled with the Unique Identity Authority of India (UIDAI). As per the information coming to The Pioneer, the conditionality of UID number would be relaxed keeping in mind the absence of cent per cent enrolments made in the districts.

“The condition is there, but the Government is thinking the compulsion of having Aadhar number of a beneficiary is waived for the initial 3-4 months. The purpose is to provide a breathing space to the beneficiaries, though the unique identification number would be followed religiously thereafter,” said a senior official. The scheme is slated to kick start on January 1, 2013 in 51 selected districts of the country.

A meeting in this regard has been called at the end of this week by the State Government in which various modalities about selection of the bank receiving funds released from the Centre under the subsidy head, further movement of the money into the districts and final disbursement into beneficiaries’ account would be sorted out.

Achintan Bhattacharya, Joint Secretary at Banking (DFS), Ministry of Finance, had also visited Jharkhand in early December for final review of the preparedness going on in the State.

Ranchi, Hazaribagh, Saraikela-Kharsawan and Ramgarh are the districts selected where the direct cash subsidy scheme has to be rolled out in Jharkhand. Bank of India (BoI) is the lead bank in all the four districts and carrying the responsibility for opening bank accounts.

“We are focusing on opening bank accounts of at least head of the family of each household. The idea is transferring the subsidy money into the hands of the head so that it can be used judiciously. We have set a deadline of December 15 for opening 12.53 lakh accounts covering each household in the four districts,” said Tarlochan Singh, Deputy General Manager cum Zonal Manager of BoI in Ranchi.

As per the latest figures there are 3.01 lakh households in Hazaribag, 1.77 lakh in Ramgrah, 2.18 lakh in Saraikela-Kharsawan and 5.56 lakh in Ranchi district. Money coming for scholarship and LPG and Kerosene subsidy would be taken up in the beginning.

Nevertheless, the Government to expedite the Aadhar enrolment has appointed some non-State registration agencies apart from the UID that would pave way for the Aadhar-enabled payment system.

“We have also been donning the role of NSR and have appointed Vakrangee, Frontech, Protex and Matrix for the enrolments in four districts. We have publicised much about UID numbers and facilitating people for the enrolments,” added Singh.

The beneficiaries would be given money through banking correspondents who would be carrying handheld devices connected with V-SAT, put atop on every panchayat building. The BCs would be carrying maximum Rs20,000 with them daily.

2717 - Govt explores direct cash transfer without UID - Live Mint

Govt explores direct cash transfer without UID

A UIDAI official said that a final decision has not been made on the matter

Sahil Makkar  |  Utpal Bhaskar 

   

First Published: Mon, Oct 22 2012. 12 44 AM IST

Updated: Mon, Oct 22 2012. 01 04 AM IST

New Delhi: The government may directly transfer cash subsidies to even those domestic cooking gas connection holders who don’t possess Aadhaar numbers—a position the Unique Identification Authority of India (UIDAI) doesn’t agree with.

UIDAI issues the Aadhaar numbers that will give each resident Indian a unique digital identity, around which the government is planning a host of welfare schemes.

The decision on the cash transfers was made at a meeting called by Pulok Chatterjee, principal secretary to Prime Minister Manmohan Singh, earlier this month to expedite the process.

UIDAI officials at the meeting opposed the move but it was decided that direct cash transfers couldn’t wait for the Aadhaar numbers to be issued to all. So far, 200 million people have been issued Aadhar numbers, or about 16% of India’s population.

A UIDAI official said that a final decision has not been made and a committee was formed of joint secretaries to compile different views and submit a report by 16-17 October. The report has been submitted and UIDAI has said that it can meet the deadline of LPG subsidy cash transfers by January 2013 in 51 districts and in 18 states (where UIDAI is mandated to enrol people) by April.

“While UIDAI has high penetration in 50 districts where Aadhaar numbers have been issued, there the cash transfers will be made only through UIDAI-linked bank accounts. For other places where Aadhaar numbers have not been issued, one can’t indefinitely wait,” said a petroleum ministry official, requesting anonymity.

A pilot scheme is already on in one district to examine the feasibility of transferring cash subsidies in this manner.

The meeting was attended by officials in the ministries of finance, petroleum, home and representatives of UIDAI and the Planning Commission.

The “principal secretary came to the conclusion that keeping in mind all the views that had been expressed, cash transfers need not necessarily wait for Aadhaar numbers to be issued”, show the minutes of the meeting reviewed by Mint. “However, it is preferable that cash transfers are based on Aadhar numbers as and when penetration levels cross 80% as the Aadhaar based system provides multiple benefits.”

The government recently capped the supply of subsidized cooking gas to six cylinders per household per year to pare its subsidy bill. It wants to transfer cash subsidies directly to the bank accounts of the beneficiaries of the various government schemes to ensure the benefits reach the intended target.

UIDAI is mandated to issue 600 million Aadhar numbers by 2014.

“UIDAI’s second phase has already been delayed by five-six months. Our reading to this is that the government is in a tearing hurry to transfer direct cash subsidy to people’s bank accounts because of the uncertain political situation and 2014 general elections,” said another government official who also didn’t want to be identified.

“You have to understand that things can’t be implemented overnight in this country, 51 districts are good enough to start implementation. Theoretically, something may look okay, but you can’t implement something overnight for 10 crore people,” countered a UIDAI official, also requesting anonymity.

There are 140 million LPG connections in the country, of which 99.57% are for domestic use, comprising 14.2kg LPG cylinders, according to official data. The LPG customer population covers around 56% of India’s total. There is an exercise on to eliminate multiple connections, with around 20.6 million such connections already identified.

The department of financial services was of the opinion that “it is better to delink Aadhaar from cash transfers and transfer subsidy by directly having a link between LPG customer databases and bank account databases”, according to the minutes of the meeting.

“What they would be doing in test phase is matching their database with digitized database of National Population Register (NPR). If the data matches, then they would take the account details of the person on whose name gas connection is registered. The difference between the market value and subsidized gas cylinder will be transferred to the bank account,” said the government official quoted above.

UIDAI, chaired by Nandan Nilekani, was set up to assign 12-digit unique identity numbers. But the initiative led to intra-government dispute bringing it in conflict with data collection under the NPR.

The total loss from selling fuels below cost last fiscal year was Rs.1.44 trillion. State-run retailers are compensated by the government for selling diesel, kerosene and cooking gas at fixed prices that are significantly lower than the cost of production.

India subsidizes the prices of most fuels and its annual subsidy bill towards this is expected to be Rs.1.67 trillion this year.

Surabhi Agarwal and Shubham Shivang contributed to this story.

2379 - Pranab 'losing sleep' over rising subsidy bills - IBN Live

Budget 2012 | Posted on Feb 08, 2012 at 05:31pm IST

New Delhi: A worried Finance Minister Pranab Mukherjee on Wednesday said he is losing sleep over the rising subsidy bills, notably on food, fertiliser and petroleum products.

"As finance minister when I think of the enormity of the subsidies to be provided, I lose my sleep," Mukherjee said in New Delhi at a conference to discuss reforms in the public distribution system (PDS).

Due to a sharp increase in subsidies and decline in tax and other revenues, the fiscal deficit is expected to be around 5.6 percent as per some estimates, against the budgetary target of 4.6 percent.

A widening fiscal deficit coupled with the slowdown in economic growth and persistent inflationary pressure, have complicated the situation for the finance minister, who on March 16 would present the union budget for fiscal 2012-13.

Mukherjee said there was a need to boost food production through a "second green revolution" that would help reduce the food subsidy bill.

"We did achieve our self-sufficiency in food by the Green Revolution, but we now need that second revolution that will take us to a new trajectory where we can feed all and feed them with a view to ensure nutrition balance as well."

Mukherjee said the government had initiated a programme to take the green revolution to the eastern region of the country.

He also said more investment in agricultural infrastructure was required, which over the last few years had seen "a turnaround in its declining trend".

Addressing the opening session of the two-day conference in which Union cabinet ministers, food and agriculture ministers from states and senior government officials are taking part, Mukherjee said procurement of food grains and enhancement of storage capacity in view of the proposed National Food Security Act.

The finance minister called for joint efforts by the centre and states to modernize the PDS to make its reach more effective to the targeted people. He said the unique identification numbers or "Aadhaar" would help curb leakages.

"The use of the Aadhaar number in PDS will reduce duplicates, fakes and ghost beneficiaries in PDS databases which will result in reducing wastage and diversion in the system," he said.

1756 - FinMin develops online system for direct payment of subsidies - Governance Now

Government e-payment system' for direct credit of dues has been developed by the Department of Expenditure
PTI | OCTOBER 31 2011

The Finance Ministry has developed an e-payment system for direct credit of subsidies to consumers of fertiliser, kerosene and cooking gas.

"This system will bring transparency and expedite direct payments from central paying units relating to subsidies to the users and consumers...," the ministry said in a statement today.

The 'Government e-payment system' for direct credit of dues from the central government into the account of beneficiaries through the 'Government e-Payment Gateway' (GePG) has been developed by the Department of Expenditure.

Finance Minister Pranab Mukherjee will inaugurate the system on Monday.

In the wake of large scale diversion of subsidies, the government had announced it will move towards direct transfer of cash subsidy for kerosene, LPG and fertilisers.

A task force, under Nandan Nilekani, set up to work out the modalities for the proposed system of direct transfer of subsidy for kerosene, LPG and fertilisers, has submitted its interim report to the government.

The government proposes to implement the scheme by March 2012.

GePG is a portal which enables the delivery of payment services from Pay & Accounts Offices (PAOs) for online payment into beneficiaries' accounts in a "seamless manner under a secured environment".

It serves as middleware between COMPACT (Computerised Payment and Accounts) application at PAOs and the Core Banking Solution (CBS) of banks and the Reserve Bank of India to facilitate paperless transaction, reducing overall transaction cost and promoting green banking.

The e-payment system will not only save time and efforts but will facilitate elimination of physical cheques and their manual processing.

"The system will also have online reconciliation of transactions and efficient compilation of payment accounts," the statement added.

At present, cheque, cash, demand draft or in few ministries ECS for payments to employees and vendors are used.