Monday, 14 September 2015

PDS Reforms | Rajasthan

Reforms:
  • Currently ration shops in Rajasthan stock only three items (wheat, sugar and kerosene), are open only one week a month, treat citizens poorly, and have high subsidy leakage because we lack the online infrastructure to cross reference inventory, consumption and eligibility. 
    • Over the next year the state government will rebrand 5,000 of our 25,542 ration shops in a public private partnership as Annapurna Bhandars: They will stay open all month, sell more than 150 products at prices regulated by the government, start home delivery and join an online platform.
  • In parallel, all families with state government issued Bhamashah cards will have the option to choose between direct cash credit of subsidies to bank accounts or getting non-cash subsidised goods that trigger an SMS to their cellphone when their eligibility amount is issued by any ration shop
  • De-duplicated Bhamashah database will issue a card to every family that will be linked to a bank account in the name of the lady of the house. 
    • Bhamashah’s Aadhaar authenticated database makes it an effective platform for financial inclusion, health insurance, ration shops, education scholarships, Mgnrega payments, and much else – because all families will receive an SMS for all cash or non-cash transactions linked to their card.
Rationale:
  • spending that doesn’t reach the needy is not only wasteful but represents stealing from future generations.
    • Much of the Rs 80,000 crore outstanding debt of the Rajasthan State Electricity Board represents wasteful subsidies that could have been spent on roads, education or skills. A former prime minister once said that only 15% of government expenditure reaches the poor; clearly his realisation was not shared by the last central government which bafflingly cancelled the implementation of Aadhaar verification for gas cylinder subsidy just before the last Lok Sabha election.
Conclusion:
 
The wisdom of balance in governance is hardly new; the magnificent ruins at Hampi of the Vijaynagara Empire have a horizontal band of three animal sculptures at the bottom of every building; tigers (for courage), horses (for speed) and elephants (for stability). This grouping has an important message for state governments that often choose the status quo over boldness, innovation and experimentation.

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