The government of India puts a way
ahead tolaunched Cash
subsidy on kerosene after the successful implementation of cash subsidy on
LPG for BPL (below poverty line) families.
The
scheme would be known as DTCK (direct transfer of cash subsidy on PDS
kerosene). This would be on the lines of DBTL( direct benefit transfer of subsidy on
LPG (cooking gas).
The mode of
implementation would be covered under two phases , In the first phase seven
districts of three states would be covered under the subsidy.
In
Maharashtra , the scheme would be lunched in Nandurbar , Wardha and Amrawati . while in Rajasthan , Alwar , Ajmer and
Udaipur would be covered. Similarly, the initiative would be covered in
north Goa.
So far , Centre had grant a subsidy of around 1700 crore rupees
for DBTL , but now the exchequer would be expected to face a subsidy bill of
30000 crore rupees for providing fuel to BPL families.
A pilot DTCK
scheme has been running in Kotkasim tehsil of Rajasthan’s Alwar district since
December 2011. The results have been encouraging.
What is direct transfer of cash subsidy :
The price of the commodity remain same as that of the market price , government itself decide the subsidized price and pay the difference between market price and subsidized price directly to the family of the BPL in their account.
The price of the commodity remain same as that of the market price , government itself decide the subsidized price and pay the difference between market price and subsidized price directly to the family of the BPL in their account.
Instead of paying subsidy to the manufacturer , government directly pay cash to the poor people.
The change in the subsidy policy able to tackle the following
shortcomings of the system :
• Dual – pricing
• Black Marketing
• Unresponsiveness to customer needs
• Poor targeting of BPL population
• Diversion and leakages
• Under recoveries for Oil Manufacturing companies ( OMCs) .
• Dual – pricing
• Black Marketing
• Unresponsiveness to customer needs
• Poor targeting of BPL population
• Diversion and leakages
• Under recoveries for Oil Manufacturing companies ( OMCs) .
Bolsa Família Program (BFP):
The largest and the most successful conditional cash transfer program is the Bolsa Família Program (BFP) in Brazil that covered close to 100 percent of Brazil’s poor in 2007.
The largest and the most successful conditional cash transfer program is the Bolsa Família Program (BFP) in Brazil that covered close to 100 percent of Brazil’s poor in 2007.
Under the programme, the government
transfers cash straight to a family subject to conditions such as school
attendance, nutritional monitoring, pre-natal and post-natal tests. The entire
system is managed through efficient targeting, disbursement and regular
monitoring of the disbursed funds.
Impact on government
• The new system is expected to reduce this cost and subsidy bill through better targeting
• In the Union Budget 2012-13, target is to keep 2012-13 subsidies under 2 percent of GDP and under 1.75 percent of GDP in the next 3 years .
Impact on government
• The new system is expected to reduce this cost and subsidy bill through better targeting
• In the Union Budget 2012-13, target is to keep 2012-13 subsidies under 2 percent of GDP and under 1.75 percent of GDP in the next 3 years .
