Targeting Below The 'Line'...

Food is one of the basic necessities of human being without which all other amenities would hold little meaning. And to a poor, it could mean the vary existence of his life. In a rapidly growing indian economy and a nation of  more than one billion people with per capita income crossing 40,000, more than half of the population live below the elusive poverty line (BPL).  Well that sounds alarmingly menacing isn't it? In such a scenario food security becomes one of the major developemental objectives for government.

How does one measure poverty in India?
If we go by the definition set by  Planning Commission of India, poverty line is drawn with an intake of 2400 calories in rural areas and 2100 calories in urban areas. That means, if a person is unable to get that much of calories he is considered to be BPL. However, many descrepanies have been observed in the measuring methodologies adopted by various agencies and no body has been able to nail down the exact number. The meauring methods and parameters differ from countries to countries. This vary reason has led to disparities in defining the real distribution of poor population in states of India.

How does food get to the poor?
A poor man in India has two options.Either food should be made available to him at an affordable prices by the government or Government should find ways and means to raise the income level of the poor so that they are capable enough to buy food for themselves. While employment generation programmes attempt the first solution, the PDS is the mechanism for the second option.In terms of both coverage and public expenditure the most important safety net is Public Distribution System (PDS) of central government. With a network of more than 4.62 lakh fair price shops (FPS) distributing commodities worth more than Rs 30,000 crore annually to about 160 million families, the PDS in India is perhaps the largest distribution network of its kind in the world. The FPS provide rice, wheat, sugar, edible oil, soft cake and kerosene oil at subsidized prices.With PDS, government achieves two objectives ensure food security for the needy and price stability of food.

Targeted Public Distribution System(TPDS)
The Public Distribution System in India was modified into the targeted public distribution system (TPDS) in 1997, as part of the larger reforms under the new economic policy of the 1990s. The TPDS divided the population of the country into those below the poverty line (BPL) and above the poverty line (APL); with PDS foodgrains being given to those in these two categories at differential prices. this price differential is acheived by giving greater subsidies to the poorest of poor compared to those BPL in normal sense. In 2002, another category was introduced to reach out to the ‘poorest of the poor’ through the Antyodaya Anna Yojana (AAY) which provides foodgrains at about half the BPL prices. In PDS-

· The central government, based on the population of the state and its share of below and above poverty line households, allocates state wise quota of food grains. It also decides the Central Issue Prices (CIP) for the food grains
· The state government then determines off-take, the public delivery, and the list of commodities provided. The state government is allow to add to the CIP the transactions cost of keeping the stock and district wise allocation of food grains.
·  thenBlock/ Taluk wise allocation of food grains is determined by District Administration. Location of Fair price shops are also decided at this level.
· Food grains are stored in godowns at various levels
· And finally, distribution of Food grains to the Fair Price Shops and sold to beneficiary, the poor.
But is making food grains available by TPDS, a sufficient condition to ensure food security to the poor? Given central government's poor record of public welfare schemes implementation. has TPDS managed to achieve its slated objectives?

Lacuna in TPDS

1) The very first reason being the divergent views on measurement of the poverty and number of people below poverty line. The earlier 1993 Expert Group on Poverty Estimation even explicitly specified in its report that these poverty lines should not be used for the purpose of targeting public programmes. However, in practice the exercise of setting a poverty line and estimating poverty on the basis of this has very much been linked to determining allocations for public programmes;

2) The decision that a particular household will qualify as BPL household and would be eligible for a BPL ration card is arrived at by two different processes. Firstly, the numbers of BPL households are determined based on the Planning Commission estimates of poverty superimposed on the number of households from census data. Secondly, an independent exercise of identification is conducted based on a household census using criteria determined by the Ministry of Rural Development (MoRD), with the restriction that the number of poor to be identified by this process should be within the number estimated by the Planning Commission.

3)The next immediate fallout of the above two factors is problems of imperfect targeting. That is the system is likely to include people that should be excluded and exclude household that should be included.

4) The reports of the Supreme Court appointed Wadhwa Committee point out a number of issues that make the PDS a corrupt and inefficient system. Among the issues these reports raise include corruption because of the presence of middle-men at all stages such as private storage agents, transporters, millers and so on, who are in a nexus with the politicians and bureaucracy resulting in the leakage of foodgrains meant for the PDS into the open market even before it reaches the village fair price shop (FPS).

5) Wadhwa committe report also identified following deficiencies in the system:
 · Multiple ration cards being issued under a single name
· Faulty system of issue of ration cards and record keeping
· Pilferage - PDS foodgrains find way to market and all the lot don’t reach the eligible/needy person
· No bio-matric identification for the users
· No central monitoring system to track the carriage trucks
· The delivery mechanism has no RFID (Radio Frequency Identification Device)

In addition to above glaring gaps, there are even instances where the wheat and rice provided were unfit even for cattle consumption !, but the poor are forced by these weevil ridden grains.

There have been recent reports of around 61,000 tonnes of foodgrain rotting in granaries of Food Corporation of India (FCI), the government body responsible for TPDS. Officials admit that for 65 million tonnes of food buffer stocks the total warehousing capacity in the country is only 40 MT, a deficit of 25 MT. Investment of 10,000-15,000 crore is required for additional storage capacity. 

Can Technology be a solution?
Wadhwa committee suggested major revamping of the system by leveraging technologies such as RFID and biomatric finger prints. Also, with the commencement of UID project, the databases of beneficieries could be maintained enabling digital record keeping. Use of smart card based technologies and presence of Point of Sales solutions to the Fair price Shops could make the system more efficient and could pave way for the setting successful e-governance example.

Allocations for public programmes must be delinked from the poverty line, which in spite of any number of revisions cannot avoid an element of uncertanity. How can a system be efficient of the vary foundation it is built on (measure of poverty) has the element of arbitrariness, a moving target!! Given the fact that we have the highest malnutrition rates in the world, there cannot be an alternative to provision of universal services especially in relation to food along with education, health, employment and social security.The proposed National Food Security Act should be seen as an opportunity for pressing for universalisation of PDS (along with administrative reforms) to make the system more effective. We must not allow an Act to remain an entitlement for only a few (as is being proposed), especially because as long as PDS remains targeted even the few who are entitled to it are unlikely to get any benefits.

References:
http://www.indiacurrentaffairs.com/
JUSTICE WADHWA COMMITTEE Report on Public Distribution System (PDS)
Planning Commision Report on five year plan