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LEAKAGES IN THE CURRENT PDS SYSTEM IN INDIA
N.Sree Krishna MashanthV.Pravallika(valli)B.AnushaMk.DevakiV.Rakesh
Objectives
• To understand the leakages in following Schemes and Subsidies:
• PDS
• Mid Day meal scheme
• Fertilizer subsidies
• Power sector
• NREGA
• The Road Ahead
Public Distribution System
• Public Distribution System (PDS), is a national food security system, established by the Government of India under Ministry of Consumer Affairs, Food and Public Distribution and managed jointly with state governments in India.
• It distributes subsidized food and non-food items to India's poor.
• Major commodities distributed to consumers include staple food grains such as wheat, rice, sugar and kerosene through a network of Fair Price Shops (FPS) established in several states across the country.
Leakages and Problems with PDS
• Large errors of exclusion of BPL families and inclusion of above poverty line (APL) families .
• Prevalence of ghost BPL/AAY cards .
• Diversion of subsidised grains to unintended beneficiaries .
• Section of the APL households not lifting their ration quota and thus a part of the entitlement of these households leaking out of the PDS supply chain.
Leaks in NREGA
• Definition of a household
• Distribution of job cards
• Unsolicited fees being charged for work application forms
• Non-issuance of receipts
• Presence of contractors
• Non-availability of muster rolls at the worksite
Mid Day MEAL
Advantages
• Targeted Subsidies:-subsidies can be targeted and made to reach only the people they were meant for.
• Massive Savings:-DCT will translate into good savings for the government.
• Responsible/Reduced Usage:-Because DCT will only compensate for a finite amount of resources consumed, it will encourage beneficiaries reduce their usage of these resources.
Pilot Implementation and Examples
• The state government’s incentive of a bicycle to a girl child joining the ninth standard under a scheme called Mukhyamantri Balika Cycle Yojana, started in 2006. Girls get Rs 2,000 to purchase bicycle and Rs 700 for uniforms. In three years, from 2007-08 to 2009-10, about 8,71,000 girls have received bicycles.
• Mexico – PROGRESSA – transfer of cash to the woman heads of the extremely poor rural families
Challenges
• Unwillingness -People might not be, initially, so receptive to the idea of universal subsidy being removed and a more targeted system being brought in to replace it.
• Mammoth Task - Creating bank accounts for millions of house holds across India will be no easy task and will require many changes/simplifications in the procedures for account creation
Steps needed for effective implementation of DCT
THANK YOU