This is from the Prime Minister Dr.Manmohan Singh’s Facebook Page :

The Cabinet, presided by Prime Minister Dr.Manmohan Singh on Sunday night, gave green signal to the draft National Food Security Bill after a brief discussion

Once the law is implemented, the food subsidy bill is expected to rise by Rs 27,663 crore at nearly Rs 95,000 crore, while foodgrains requirement would go up to 61 million tonnes from 55 million tonnes, as per the Cabinet proposal.

The Indian National Congress had promised food law in its manifesto for 2009 election and President had announced this in her address to the joint session of Parliament in June 2009.

In rural India, up to 75 percent of the people will be covered, with at least 46 percent under priority households (which is same as below poverty line families in the existing public distribution system).

Up to 50 percent of people will be covered in the urban centres, with at least 28 percent under priority category.

The bill seeks to provide 7 kg of rice, wheat and coarse grains to per person per month to priority households at Rs 3, Rs 2 and Rs 1 per kg, respectively.

This is much lower than the rate at which foodgrains are currently supplied to poor through ration shops.

Under present PDS, 35 kgs of wheat and rice per month is supplied to 6.52 crore BPL families at Rs 4.15 and Rs 5.65/kg, respectively.

General category would get at least 3 kg of grains at a rate not exceeding 50 percent of the minimum support price.

At present, about 11.5 crore APL families get at least 15 kg of wheat and rice per month at Rs 6.10 and Rs 8.30/kg, respectively.

The proposed law has been under consideration of an empowered group of ministers, headed by Finance Minister Pranab Mukherjee, since September 2009.

Smt. Sonia Gandhi led National Advisory Council (NAC) and an expert committee headed by Prime Minister’s Economic Advisory Council (PMEAC) Chairman Shri.C Rangarajan had also submitted their recommendations on the bill.

Can see the next election slogan : 1 2 3 or it could be 3 2 1

I only wish that it comes in with targeted delivery – directly to the household, an overhaul of the PDS system and economic reforms v2 to pay for these. Hope this does not mean more tax – nothing worse than taxing yourself into a recession to pay for welfare.

There are a 1000 loopholes that come to mind, but I can’t see anyone – in power – seriously objecting to these. Not unless they don’t mind losing elections. The key is going to be in delivery. Would be very interested to know how they plan that.

Some questions that would need to be sorted out are:

a) How do you decide BPL. I know a figure has been set. But, how does a family/individual prove that they are BPL ? 

b) How are you going to deliver the food to the households? Is it via the ration shop? is there some other mechanism? what is this mechanism?

c) If the government is going to buy and sell grains – and in effect becomes the monopoly food aggregator and reseller – what happens to food prices for the rest of the country – those not covered by the FSB? is this going to push people APL down to BPL? We are not talking about huge economic differences between the two. 

d) Instead of subsidised food why can the Government not look at a cash transfer, once a month/once a fortnight/ at regular intervals. Let people figure the food they are going to eat. I understand that the NAC opposes this because they are afraid that the men will use the money for alcohol, but the monies can be given to the female. Besides, there is nothing to prevent him from selling the food to get the booze. or indeed selling his wife. The Government is not nanny. Not its job to keep people away from the bottle. 

e) How, for example, are the urban homeless going to be targetted to receive food. Will they receive food? Where will they cook it ? 

f) How frequently are the food transfers going to take place – once a month, once a fortnight, every quarter … how is the government going to store the food? 

g) How is this going to be paid for ? Is the government going to print more money ? is it going to raise taxes? Is it going in for growth. 

For the record, i don’t oppose welfare. I believe that if we have aspirations to be a great nation, a just society – you can’t have over half your population going to sleep on an empty stomach. I also know that this 50% is below the radar of market forces. Non people. non consumers. My concern is two three  fold ,

•  the food should reach the intended.
•  The cost of reaching the food to the intended should not pauper a new set of people – those just above poverty line. 
• you don’t open up one more avenue for leakages & corruption.