Raman opposes Cash Transfer Scheme on PDS

Raipur, November 29, 2012: Chhattisgarh Chief Minister Dr Raman Singh today opposed the cash transfer scheme of the Centre saying any changes in the PDS should be done only after consulting the state government.

The Chief Minister, through a letter to Prime Minister Dr Manmohan Singh, asked to exempt targetted public distribution system in Chhattisgarh from the proposed cash transfer scheme.

"The state does not agree with transfer of cash subsidy to the beneficiaries of the Targetted Public Distribution System and I request you to exempt PDS in Chhattisgarh from the proposed cash transfer scheme," Raman said.

The Chief Minister said he was regret to note that many of his suggestions on identification of BPL beneficiaries, strengthening PDS and end-to end computerisation of PDS have not been accepted and the government of Chhattisgarh was not in favor of transfer of cash subsidy to the beneficiaries in TPDS.

There are lots of problems in implementation of cash subsidy transfer under PDS, he said.

"In my view, Fair Price Shops under PDS are the only viable and convenient option for access to foodgrains in rural areas in the State. Financial inclusion and availability of IT infrastructure are preconditions to any scheme of cash transfers. There are substantial problems in the State on both accounts," Raman said.

"It would also be difficult to fix the monthly cash subsidies in view of fluctuation in market prices.

"The system is also vulnerable to misuse of cash subsidy amount by the male heads of the households or purchase of non PDS commodities which would defeat the very purpose for which the subsidies are proposed to be transferred," the Chief Minister said.

Chhattisgarh has been pioneer in reforming the PDS and the Government of India has not only recommended replication of the Chhattisgarh Model in other states but also by the Supreme Court of India, he said.

It has been the experience of Chhattisgarh government that substantial improvement in service delivery at the Fair Price Shops could be achieved by bringing about qualitative changes in the existing system through reforms and by close monitoring of the whole PDS supply chain, Raman said.

In fact, given the limitations of Banking and IT infrastructure, the system of cash transfers would lead to increased inconvenience to beneficiaries, the Chief Minister told the Prime Minister.

Also, since implementation of PDS at state level is the responsibility of State Government, any changes in the system should be done only with the consent of State Government, he said.

"I would like to reiterate that the government of Chhattisgarh is committed to reforms in PDS and is of firm belief that substantial improvement in PDS service delivery can be achieved through reforms and monitoring. Hence the State does not agree with transfer of cash subsidy to the beneficiaries in Targeted Public Distribution System and I request you to exempt PDS in Chhattisgarh from the proposed cash transfer scheme," he said.

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