Saturday, June 16, 2012

Despite protests Delhi Govt. going ahead with cash transfers

While protesting against Delhi Government’s decision to conduct pilot surveys in Sangam Vihar and Jahangirpuri for cash transfers so as to replace the existing public distribution system (PDS), activists from Bhalaswa Lok Shakti Manch told the media persons gathered at Indian Women Press Corps on 15 June 2012 that they have collected 4500 signatures (including 3300 signatures in Jahangirpuri alone) of residents who do not want cash in lieu of ration.

Speaking at the press meet, Pushpa from Bhalaswa Lok Shakti Manch (BLSM) said that Delhi Government is in favour of replacing the PDS with cash transfers. Rozi Roti Adhikar Abhiyan survey conducted in 2011 showed that 91.4 percent of respondents preferred a reformed PDS instead of cash transfers (see the link: She alleged that for distributing Rs. 12 lakh to 100 persons (one each for a household) as money for cash transfers (for a year) in Raghubir Nagar, Rs. 14 lakh was spent on the survey done by SEWA and IDF. On 26 April, 2012, UNDP and the Delhi Government along with SSMI organized a public meeting in Jahangirpuri in order to convince people about the advantages of cash transfers over PDS. However, through a signature campaign, 4500 signatures were collected from people rejecting the cash transfer scheme. The same have been sent and communicated to the Chief Minister of Delhi, FSO Commissioner, AC (north West) and UNDP along with memorandum of people from Jahangirpuri. She said that APL cardholders have been excluded from the cash transfer scheme. People who have demanded for their rights have faced harassment at the hands of officials and ration dealers.

Manmohan Singh, activist from Bhalaswa Lok Shakti Manch informed that for submitting cash (of Rs. 1000/- per month) in favour of a female head of the household in the Raghubir Nagar survey, there were difficulties faced in opening of bank accounts due which the Delhi Government had to directly intervene. The monthly sum of Rs. 1000/- which was given as cash transfer for a household (of 5 members) in the pilot survey by Delhi Government is not enough to purchase ration that can generate 2200 kilo calorie for an adult per day in urban areas. Since 70 percent of BPL households have an average size of 7 (and not 5 as assumed by the Delhi Government), so the sum stipulated under the cash transfer scheme is insufficient to meet the monthly expenditure for a household. Manmohan said that the PDS in Delhi is subject to governance failure. It is not the PDS which is problematic but those who govern the system who are at fault. Despite several RTI petitions being filed, most ration/ fair price shops do not disclose information to the consumers proactively. Repeated complaints made on irregularities in PDS have fallen on deaf ears. Citizens’ Charter of Delhi has not been implemented well. Earlier the Supreme Court slammed the Government for putting a cap on the number of BPL ration cards issued when so many poor people migrate to Delhi in search of livelihood opportunity. The e-PDS is of little benefit to the BPL.

Reetika Khera from IIT, Delhi said that not all cash transfers are bad like widow pension, old age pension etc. She informed about her study that was done in 10 states along with Jean Dreze during 2011. In two-third of the households surveyed, PDS was preferred over cash transfers. In Chhattisgarh, Orissa and Andhra Pradesh, people were mostly in favour of PDS. People preferred food over cash for the following reasons: food security; access to bank/ post office; access to markets; dissipation of cash (for buying alcohol); underdeveloped rural markets; and, artificial inflation caused due to collusion by local traders. If the PDS is replaced with cash transfers, the burden of transportation and storage costs would be transferred to the poor. From her past experience of working with the rural poor, Reetika earlier felt that poor in the cities are not disempowered and do not lack awareness. However, having heard the activists from BLSM, she asked for giving urban poor both the options: cash transfer as well as PDS. In a democratic set up, people’s views have to be taken into account, she added. She said that the arguments in favour of cash transfers were heard during the days when PDS was subject to rampant corruption and pilferage. However, the situation in India has improved a lot. In her study based on secondary data from NSS 2007-08, she has found that states that have traditionally performed poorly in terms of monthly per capita PDS purchase viz. Chhattisgarh, Uttarakhand, Orissa, Madhya Pradesh and Uttar Pradesh have improved their performance between 2004-05 and 2007-08 (please see: People prefer PDS over cash transfers, India is wrongly imitating the Brazilian cash transfer model-‘Bolsa Familia’. Poverty headcount ratio at $1.25 a day (PPP) in Brazil was 6 percent in 2009 while in India it was 33 percent in 2010 (as per the World Development Indicators). Brazil has achieved almost universal literacy while India has a long way to go. Brazil is more urban as compared to India. Given these differences, India needs direct Government intervention for removing malnutrition. 

Rashpal Kaur, Delhi state general secretary, National Federation of Indian Women (NFIW), the women's wing of Communist Party of India said that though the Government is in a mood to abolish the PDS, there is no guaranty that corruption will not take place in cash transfer scheme. The Government wants FDI in retail to make entry in India at the cost of common man’s interest. However, the government is depriving the poor. The APL and BPL divide in PDS should be ended and PDS should be made universal. She said that the Planning Commission wants to reduce the number of BPL card holders in the country. As against the accepted number of 6.52 crore BPL cards, there existed 10.68 crore BPL cards by end of March, 2009. There is no uniformity in the definition of poor. There are three different estimates for the number of BPL households: one by Prof. Arjun Sengupta, another by Dr. NC Saxena ( and the Planning Commission estimates. According to Prof. Arjun Sengupta who chaired the National Commission for Enterprises in the Unorganized Sector, 77 percent of the population of India lives below the poverty line. Dr. NC Saxena, a retired civil servant acting as a Commissioner appointed by the Supreme Court, feels that half the country’s population of 1.2 billion is below the poverty line, which he apparently defines as a monthly per capita income of Rs 700 in rural areas and Rs 1,000 in urban areas. A recent Planning Commission estimate puts the head count ratio in India at 29.8 percent in 2009-10. She alleged that quota for Central assistance in PDS to states has been reduced in recent years. She said that even the Prime Minister while releasing the HUNGaMA report has agreed that it is a national shame for India to have 42 percent of its children as underweight. Though the Government spends conspicuously on toilets and gave 5 lakh crore sops in its budget to industrial houses, it never has enough money for the poor. Cash transfer is dangerous and the Government is under pressure from the private sector. The Food Corporation of India has outsourced its work to outsiders and is running short of staff. The Government is not willing to buy from farmers. Cash transfer scheme that is being piloted is not linked to inflation. Somehow the Government wants to manipulate data so as to show that India has reduced poverty as per the Millennium Development Goals requirement. A lot of money is wasted on trivial programmes like Stand Up against Poverty ( and Make Noise against Poverty.         


Survey on preference between PDS and cash transfers in Delhi by Rozi Roti Adhikar Abhiyan, Delhi,  

Do Poor People in Delhi want to change from PDS to Cash Transfers?-A Study conducted by SEWA Delhi, October 2009,

Justice Wadhwa Committee on PDS,

Bolsa Familia in Brazil: Context, Concept and Impacts (2009), ILO,

The Nuts and Bolts of Brazil’s Bolsa Família Program: Implementing Conditional Cash Transfers in a Decentralized Context-Kathy Lindert, Anja Linder, Jason Hobbs and Bénédicte de la Brière, May 2007,

HUNGaMA: Fighting Hunger & Malnutrition (2011), Naandi Foundation,

Poor want ration, not cash: Activists, IANS, News Track India, 15 June, 2012,

Delhi government faces SC’s wrath for not issuing ration card, Jagran Post, 18 May, 2011,

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