Aadhaar-subsidy push: Govt for 80% linkage soon in five schemes -Sanjeeb Mukherjee

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published Published on Sep 19, 2014   modified Modified on Sep 19, 2014
-The Business Standard


PlanCom meets this month to hasten implementation; initial focus on target coverage might cover 300 districts

After reposing faith in the Aadhaar project at its cabinet meeting last week, the Narendra Modi government wants Direct Benefits Transfer (DBT) to 80% of beneficiaries in five key schemes "as soon as possible".

These include the cooking gas subsidy, where DBT was stalled under the previous government. The other schemes are on transfer of pensions, scholarships, the National Rural Employment Guarantee Scheme and the Public Distribution System (PDS).

The Planning Commission's assessment is that Aadhaar penetration in the five schemes varies at 25-60%.

"In some states it is even less, which will now be scaled up to ensure a mechanism through which 80% of beneficiaries of the five programmes get funds is Aadhaar-enabled," a senior official said.

He said to start with, 80% Aadhaar penetration will be confined to 300 districts, to be expanded once the first stage gets over. There are about 670 districts in India.

The Commission, nodal agency for Aadhaar, has called a meeting of state representatives on Tuesday and those from the Union Territories on September 30. "In the meeting, we will review the progress of Aadhaar statewise, evaluate the bottlenecks and find a solution," the official said.

It appears the Prime Minister's Office is directly monitoring the progress of Aadhaar coverage in these five schemes. It had sought a report on the feasibility of implementing DBT in these schemes from the Planning Commission sometime earlier.

Earlier this month, Prime Minister Modi chaired a review meeting on both Aadhaar and the home ministry's National Population Register (NPR) project. And, emphasised the need for using biometric technology to stop leakages in welfare schemes. Officials said it was decided that bank accounts would be linked to both Aadhaar and NPR for cash transfers -- the finance ministry was told to work out a mechanism for linking NPR to bank accounts.

In the earlier regime, efforts were made to transfer cash directly to the bank account of beneficiaries for PDS and cooking gas, among others. However, it was stalled after some time due to opposition from ruling party members. Before DBT for cooking gas was put in abeyance, around Rs 5,000 crore was transacted through this channel.

The cabinet had last week re-approved the Unique Identification Authority of India's (UIDAI's) mandate by extending its coverage to four more states, to cover a billion people. The Aadhaar project underwent a period of uncertainty after the Bharatiya Janata Party-led government came to power, since the latter's leaders had opposed the project during their poll campaigning. About 674 million Aadhaar numbers have been generated till date and the total expenditure incurred by UIDAI since inception is Rs 4,906 crore (as on end-August).

Estimates show the fuel subsidy bill can be lowered by an estimated 20% through this scheme. Fuel subsidy was pegged at Rs 63,427 crore for 2014-15, about a fourth less than the revised estimate of Rs 85,480 crore for the previous year.

In food, almost half the annual subsidy, Rs 115,000 crore in the 2014-15 Union Budget, does not reach the intended beneficiaries.

Get going

a) PMO wants 80% Aadhaar-enabled direct transfers in five schemes soon

b) These are for subsidies in cooking gas, PDS, NREGS, scholarships and pensions

c) Planning Commission calls meet if states, UTs this month to review progress

d) Aadhaar penetration in these five schemes only 25-60% now

e) In the first phase, 80% Aadhaar penetration the aim, for 300 districts


The Business Standard, 19 September, 2014, http://www.business-standard.com/article/economy-policy/aadhaar-subsidy-push-govt-for-80-linkage-soon-in-five-schemes-114091900890_1.html


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