Govt keen on direct subsidy; sets up task force under Nilekani

New Delhi, Feb 14 (PTI) Concerned over leakage andwastage of public funds, the government today constituted atask force under UIDAI chief Nandan Nilekani to suggest waysto provide kerosene, cooking gas and fertiliser subsidies tointended beneficiaries directly.

The inter-ministerial task force to streamline thesubsidy distribution mechanism comes within three weeks of abrutal incident of burning alive an additional districtcollector Yashwant Sonawane in Maharashtra while he was tryingto check illegal hoarding of kerosene and petrol.

The Centre provided a subsidy of Rs 14,257 crore on LPGand Rs 17,364 crore on kerosene during 2009-10. It had spendRs 53,000 crore towards fertiliser subsidy. However, it isfeared that only a fraction of these amounts reached theintended beneficiaries.

The task force, which has been asked to submit itsinterim report within four months, will suggest "a model ofdirect transfer of subsidies re-engineering existingsystems, processes and procedures in the implementationprocess", said a finance ministry release.

The need to set up the task force arose in view of"overwhelming evidence that this (current) policy is resultingin waste, leakage, adulteration and inefficiency. Therefore,it is imperative that the system of delivering the subsidisedkerosene be reformed urgently," it added.

The committee is headed by former chief of InfosysNilekani, who at present is Unique Identification Authority ofIndia (UIDAI) chairman. The panel will include secretariesfrom ministries of finance, chemicals and fertilisers,agriculture, food, petroleum and rural development.

Besides designing IT framework, the task force will alignthe systems with the issuance of the UID numbers and suggestchanges in the administration and supply chain management.

The recommendations of the task force, the statementsaid, will be implemented on pilot basis by the concernedministries and the final report would include the results ofsuch projects.

At present, the government provides kerosene at subsidiedrates through the Public Distribution System (PDS) to familiesliving below poverty line (BPL). The LPG is provided asubsidies rates to households.

As regards fertilises, the government provide subsidy tocompanies so that farm inputs, which include urea and importedfertilisers, can be provided to the farmers at cheaper rates.

"It is not possible to differentiate the segments forwhich the subsidy should be given in this (fertiliser) sector.

There is a need to evolve a suitable mechanism for directsubsidies to individuals who are entitled to them," it said.

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