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CRISIL Research today sid the successful implementation of the Food Security Bill (FSB) will leave more savings in the hands of rural and urban below poverty line (BPL) households, enabling them to allocate more towards spending on health, education, nutritious food among other things.
According to CRISIL Research’s calculations, the implementation of FSB could generate additional savings of around Rs 4,400 this year for every beneficiary household.
The savings would arise because BPL households that currently purchase foodgrains at the higher market price will have access to subsidised rice and wheat after the implementation of the FSB.
Less than 44% of BPL households had access to subsidised rice, and only 33% bought subsidised wheat in 2009-10.
“The additional savings of rural BPL households will be almost twice of what they spend on health and education annually now," says D K Joshi, chief economist, CRISIL Limited.
Rural BPL households currently spend around Rs 2,400 on health and education annually. This is nearly half the amount which they will additionally save with the successful implementation of the food bill.
The savings of Rs.4,400 will equal around 8% and 5% of the total annual expenditure of rural and urban BPL respectively. Having more disposable income would encourage BPL households to increase their discretionary spending. Therefore, the benefits of the Bill could go well beyond just food.
The Cabinet has cleared the bill, but the government is yet to table the bill in Parliament.
