National Institution for Transforming India (NITI Aayog) has suggested a revision in the National Food Security Act, 2013 (NFSA) which, initially affirmed catering food grains to families of ‘eligible households’. Briefly, the proposal incorporates reducing its coverage from 75:50 in rural and urban areas to 60:40.
What Is The National Food Security Act, 2013 (NSFA)?
The National Food Security Act assures a legal right to people from ‘eligible households’ for receiving food grains at a subsidised rate. About two-thirds of the population is entitled to the Act. The eldest woman of the household, 18 years of age or above, is assumed to be head of the household who will issue ration cards under the Act. Adding on, its life-cycle approach guarantees provisions for pregnant women, lactating mothers and children in the age group of 6 months to 14 years by giving them nutritious meal free of cost through a system of Integrated Child Development Services (ICDS) centres called Anganwadi Centres. Pregnant women and lactating mothers are further authorised to receive a cash maternity benefit of not less than ₹6,000/- to partly compensate for the wage loss during pregnancy and supplement nutrition.
The rates of these foodgrains are:
- Rice at ₹3/kg
- Wheat at ₹2/kg
- Coarse grain at ₹1/kg.
‘Eligible households’ comprise ‘priority households’ and families under the ‘Antyodaya Anna Yojana‘ (AAY). ‘Priority Households’ are entitled to 5 kgs of foodgrains per person per month. AAY provides 35 kgs of food grain per household per month. Wheat and rice at a scale of 15 kgs and 20 kgs per family per month get supplied.
How Does This Distribution Take Place?
The dispatch takes place over a Targeted Public Distribution System (TPDS) managed by the Central and State Governments. Under TPDS, beneficiaries are divided into two categories. Households that are Below the Poverty Line (BPL) and households that are Above the Poverty Line (APL). ‘Priority households’ and families under the AAY both come under the umbrella of BPL and are the intended advocates of TPDS. However, this is subject to change under Government policies and interventions for development in various sectors and issues arising out of their design and implementation with challenges within the Indian Economy. The same comes under sub-section (2) of section 3, determined by the Central Government.
The NFSA designates coverage to 75 per cent for the rural population and up to 50 per cent for the urban population from ‘eligible households’.
According to the census of 2011, the ratio of 75:50 covered 81.35 crore people in India.
The Problem Encountered
With the increase in population annually, the 75:50 ratio started raising the number of people served. In turn, this raised the cost assigned to this Act by ₹14,800 crores. The increase in fiscal burden associated with the Act seemed unfeasible for the government.
Under Schedule-I, an update in the prices three years since implementing the 2013 Act was planned, but the same was delayed.
If the Parliament passes a law for the same, which is a gruesome procedure, most ‘eligible households’ will suffer from hunger. Their availability of finance would lead to impoverishment.
The Proposal By NITI Aayog And Its Relevance
1) Change in Ratios:
With the increase in population, the cost for the 75:50 ratio goes up by an overall of Rs. 14,800 crores. Due to the unaffordability of the same, the think tank, NITI Aayog, proposed a reduction.
60% of the rural and 40% of the urban ‘eligible households’ would be covered under the improvised Act.
The recipients under the NFSA will drop to 71.62 crores from the original number of 81.35 crores.
2) Change in CIPS:
The food subsidies currently at the rate of ₹1/2/3 are subject to change. These rates are Central Issue Prices (CIPs) issued to the beneficiaries. A change in them and the ratios would eventually lead to saving the money spent on the Act.
3) Recommendations for a smooth flow:
After the Census of 2011, no proper surveys for calculating the population had come up. To provide a definite coverage plan, NITI Aayog recommended updating the population level.
Implications Of The Proposal
To amend the proposal, the Parliament would have to approve changes under the law. With the rise in population, more money is ‘invested’ than ‘allotted’ to that particular Act. The NITI Aayog says that the Centre can save up to ₹47,229 crores with the proposed plan.
With no change in the ratio, the number of people covered will increase from 81.35 crores to 89.52 crores, eventually leading to an additional subsidy of ₹14,800 crores.
