These days Lakshmi does not line up at a small corner store clutching her yellow card to buy low-cost foodgrain that the government sets aside for the poor. This does not mean she has stopped availing the benefits under the public distribution system (PDS). In fact, Rs 1,000 gets transferred to her account on the 1st of every month in lieu of what her ration card used to fetch. She can spend the money on grocery, milk or anything she chooses to buy.
Lakshmi is not alone; there are 99 other families at Raghuvir Nagar in West Delhi who avail this cash transfer scheme. Under a pilot project, the Delhi government, in association with a non-governmental organisation (NGO) Self Employed Women’s Association (Sewa) has been providing cash instead of subsidised foodgrain to the poor since January.
However, all is not well with the scheme. Several civil society groups, led by NGO Parivartan, are against it, arguing the scheme was meant to shut down ration shops without even seeking the consent of the 450,000 below poverty line (BPL) families in Delhi.
Parivartan founder Arvind Kejriwal said while the central government was working on a Food Security Act that would be rolled out through ration shops, the Delhi government was trying to close them down.
He also expressed surprise as to why Chief Minister Sheila Dikshit had decided to test the scheme with just 100 families. “If the government has already decided to replace ration with cash, then why is a pilot project being done at all? And what is the chief minister’s interest in doing the cash transfer scheme all over Delhi?” he asked. He also argued cash transfer did not guarantee an end to leakages.
Parivartan’s Santosh, who led an NGO delegation to meet the chief minister, alleged Dikshit threatened activists opposing the project with “dire consequences” if they intervened. According to Santosh, Dikshit said ration would be replaced by cash all over Delhi soon, and later, throughout the country.
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Santosh said: “These families never got the PDS benefits and, hence, preferred money. We and other NGOs feel the need of the hour is to improve the ration system rather than substitute food with money. What is the guarantee that people would get the money when the programme is scaled up from 100 families to the whole territory?”
Sewa had pegged the value of 32 kg of wheat, 5 kg of sugar, 6 litres of kerosene and 10 kg of rice, which a BPL family got every month, at Rs 1,000.
Kejriwal pointed out the amount was not inflation-sensitive. “Rs 1,000 fetches 32 kg of wheat and 5 kg of sugar and 6 litres of kerosene at today’s market rates. But a year later, this amount would barely get a part of this. So, where is the guarantee that the amount would be linked to inflation?” he asked.
The Delhi government maintains the United Nations Development Programme-funded project is aimed at finding a better alternative to plug the loopholes in the PDS system. The project is part of a string of pilot schemes being done across the country to test the ground for issuing smart card and cash transfer-based PDS, which may eventually lead to the abolition of ration shop system, often criticised for inefficiency, widespread corruption, illegal sales, creation of false cards and urban bias, among other things.
Rashmi Singh, managing director of the Mission Convergence Project, conducting and monitoring the programme, said she could not speak of the future. Ideally people should have the freedom to choose between cash and kind, according to her. "I don't know how it would be done in Delhi. People joined the project by choice," she said. As for the amount being adjusted to inflation, she said the amount was meant only for the pilot project and it might not be static. Sewa is reluctant to take the media to meet the beneficiaries. Sewa's Renana Jhabwala said the atmosphere was "too tense" last month and, hence, she did not want media coverage for some time. Deep Jyoti, project coordinator at Sewa, alleged Parivartan workers had been motivating the beneficiaries to abandon the project. "They had been interviewing them and taking their signatures on blank papers," she said.
"Parivartan activists staged dharnas and demonstrations and have been running a campaign against the Sewa workers," said Jyoti.
(Some of the names changed on request)