Sunday, July 28, 2013

The Chhattisgarh Model

  • The state government in Chhattisgarh has indeed employed many technological innovations under PDS. 
  • It began with computerization of Fair Prices Shops (FPS) and data related with stocks and sales to enable swift allocation of grains. 
  • For ensuring that food grains are delivered to ration shops, “doorstep delivery” was started wherein GPS-enabled transport vehicles helped streamline the system through constant tracking. 
  • Mobile based applications including SMS alerts for interested beneficiaries were offered which improved the access to information about food grains lifted from godowns and their delivery at ration shops. 
  • At the village level, i.e., after food grains reach the ration shops, the reformed system ensured that all information pertaining to beneficiaries was made public. 
  • This was done through painting houses with colour codes signifying kind of cards held, in the process “naming and shaming” the cases of wrong inclusion . 
  • The list of BPL households was displayed at Panchayat offices too. 
  • All these innovations were supported by centralized monitoring and grievance redressal mechanism in the form of a functioning helpline and access to information regarding PDS.
  • One of the most important changes brought about by the government was discontinuing its earlier policy of “privatizing” PDS dealership in 2001. 
  • While this privatization was supposed to spread the reach of the FPS network in the state, it effectively created more incentives for dealers to get involved in corruption and escape through political connections. 
  • The Chhattisgarh Public Distribution System (Control) Order 2004 defined a set of agencies and institutions eligible for FPS dealership that included Gram Panchayats, Self-Help Groups etc. 
  • These agencies were then provided increased commissions from state government funds so that they stabilize and recapitalise .

It is political will that seems to matter most. Somehow, the PDS became a political priority in Chhattisgarh and a decision was made to turn it around, instead of siding with the corrupt dealers who were milking the system. When political bosses firmly direct the bureaucracy to fix a dysfunctional system, things begin to change.

Would Cash Transfers Change Anything?
  • Going by the pronouncements of the government, the direct cash transfers scheme, in its pilot stage, has shown great potentials in reducing the subsidy burden on account of social security programmes. 
  • In the case of Kotkasim (Rajasthan) pilot, failures in opening of bank accounts for beneficiaries and delayed transfer of cash into those bank accounts led to steep decline in the off-take of kerosene from ration shops and destruction of PDS infrastructure. 
  • Compare these outcomes with the Chhattisgarh experience where a tendency towards universalisation has led to higher offtake and greater efficiency in reaching the beneficiaries.
  • Universalisation is often opposed on the grounds of fiscal constraints. 
  • We have shown elsewhere that such claims are invalid and dishonest . 
  • The overemphasis on targeted PDS is ostensibly aimed at reducing the type I error in targeting but invariably enhances the type II error with heavy human and social costs. 
  • Similarly, the ubiquitous idea that bogus cards and misclassification of beneficiaries are the biggest source of corruption in PDS is not supported by evidence . 
  • The Chhattisgarh example shows that the last mile problem can be solved by simpler technologies such as mobile telephony.
  • If we accept the underlying claim that cash transfer scheme alongwith UID (Aadhar Enabled Cash Transfers) is system-neutral, the only outcome that can be ensured, theoretically, is an efficient targeting of subsidies to the “truly deserving beneficiaries”. 
  • That, however, is no guarantee to reach the truly poor and sustenance of social policies in terms of reducing malnutrition and poverty in rural India. 
  • If, on the other hand, the entire exercise is to dismantle the existing and already dismal social security infrastructure in the country by reducing the subsidy bills of the government, the ruling party and the business media must say so!

The Chhatisgarh Food Security Bill 


Comparing the Chhattisgarh food security bill with that of the Centre's  !



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