Saturday, October 23, 2010

NAC wants subsidised food for 75% Indians

NEW DELHI: The National Advisory Council, headed by Sonia Gandhi , has worked out a compromised formula for the food security act on Saturday. Keeping in mind the budgetary and the foodgrain constraints of the government the council has proposed "near universal with differential entitlements" food security programme. Under the compromised formula, 90% of the rural households and 50% of the urban households will be covered.

It has recommended to the government that the programme be rolled out from the next financial year. All beneficiaries will be covered by March 31, 2014. A "reformed" public distribution system will be the vehicle for rolling out the programme.

The Council is of the view that at least 75% of the country should get subsidised grain. This is further broken down as 90% of all households in rural India, and 50% in urban areas.

"We are obviating the need to look at the BPL data. Starting from the top we have decided to knock off 15% of the most affluent section from the rural areas and 60% from the urban areas and including the rest under the food security net," NAC and Planning Commission member Narendra Jadhav said.

The NAC decided to set aside the BPL criteria. Instead it has suggested two broad categories—"priority" and "general"—eligible for foodgrain entitlement under the proposed food security law. Both these categories will have to be defined by the government. On its part, the advisory panel has based on the Tendulkar committee report to quantify the two categories. Accordingly, the "priority" category is estimated to include 46% of all households in rural areas and 28% in urban. The "general" category is at 44% of all rural households and 22% of urban.

As regards the entitlement, the Council has proposed that the "priority" category will receive a monthly entitlement of `35 kilos of foodgrains at a subsidised price of `1 per kg for millets, `2 per kg for wheat and `3 per kg for rice. The "general" category, on the other hand, will get a monthly entitlement of 20 kilos of foodgrains at a price, which would not exceed 50% of the minimum support price (MSP). It has been suggested that the minimum coverage and entitlements as well as prices should remain unchanged at least until the end of the Twelfth five year plan in 2017.

"We, originally started with a proposal of near universalisation with just 10% of people at the top in rural India being excluded. This was challenged on the grounds of both budgetary and food grain shortfall. Given that, the NAC's recommendations are much better than what the government had originally proposed, especially the 1/2/3 formulation for the priority households," NAC member Aruna Roy said.

Other important components of the NAC's food security bill are legal entitlements for child and maternal nutrition, as well as for community kitchens and programmes for feeding the destitute and vulnerable groups. Suggestions have been made for revitalising agriculture, diversifying the commodities available under PDS, ensuring universal access to safe water and proper sanitation. The Council has recommended universalising primary healthcare, extending nutrition and health support to adolescent girls, strengthening the school health programme, the programme for Vitamin A, iodine and iron supplementation and the national programme for creches.

The NAC has recommended that programme cover 85% of the rural population and 40% of the urban population in the first phase itself. It has recommended commencing implementation of the first phase from the next financial year, 2011-12, and complete coverage by the financial year 2013-14.

Mr Jadhav said that the first phase of the food security law may cost the exchequer an additional `15,137 crore in food subsidies. After the implementation of the final phase, the additional cost would be `23,231 crore. At present, the government spends `56,700 crore every year on food subsidies.

A "reformed" public distribution system will be the vehicle for rolling out the programme. The NAC will now examine proposals for PDS reform. Options being considered include decentralised procurement and storage; de-privatisation of PDS outlets as in Chhattisgarh where these are run by self help groups and other village bodies. Apart from these, the NAC will also consider the possibility of doorstep delivery of grain to PDS outlets; revision of PDS commissions; use of ICT including end-to-end computerisation of the PDS, full transparency of records and use of smart cards and biometrics subject to successful pilots.

The NAC's recommendations are expected to be considered by the Cabinet, and then introduced in Parliament as the National Food Security Bill.
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