Food
Security spells Insecurity for Farmers!
UPA-2
finally bought in its most favoured welfare scheme ensuring food
security for more than half the Indian population. Though the food
security of beneficiaries of this scheme is definitely uncertain but
UPA-2 is implementing this scheme only to make sure it can gain
political mileage by voter support because of the same. UPA-2 has
failed on all fronts. It is desperate to come back to power and since
it has nothing to how in its report card, Food Security Bill looks
like its last resort. Those who oppose it will be named 'Anti poor'
hence the opposition parties cannot openly oppose this scheme. And if
they endorse it, the benefit goes to UPA-2! It is a kind of catch 22
situation for all opposition parties.
Let us make
it clear that poor of the country must be taken care of. It is the
social responsibility of all of us and of course of the government.
But how do we do it is equally important.
With
implementation of FSB, the government is planning to feed more than
half the people with cheap grains. There are a few important factors
to be considered for assessment of this gigantic scheme.
Identifying
Beneficiaries
How
government is going to identify the beneficiaries of this scheme?
Whenever in the past it has left this job of identifying
beneficiaries of any scheme to its employees, there has been only
corruption. Even identifying freedom fighters was not above
suspicion! Recently in Maharashtra, lakhs of duplicate beneficiaries
of Niradhar Yojana were identified. The government machinery has
pocketed thousands of crore rupees in the name of these spurious
beneficiaries. Earlier, it was found that the government aided
schools have about 25% students who do not exist but the schools keep
getting grants for salaries of teachers for these non existing
students! Now if the government is planning to rely on same old
methods and machinery for implementation of FSB then one can easily
understand that it will only give itself a new opportunity for
corruption of gigantic scale!
Now if
government adapts more scientific Aadhaar based technology
co-relating it with data collected during census, we may have some
scope of proper targeting. The biometric Aadhaar card makes sure that
every individual is accounted for and can have only a unique number
and identity it has a mechanism to eliminate duplicate or ghost
entries. This time the census had recorded detailed information about
houses, white goods in them, sources of income, sources of drinking
water and so on. Now if this data is co-related with Aadhaar Id card,
then we can have information about most of the Indians based on
which, after deciding the criteria of selection, identifying the
beneficiaries is a straight forward job. The whole process of
census-Aadhaar is such that the responsibility of incorrect entries
can be pinpointed to an individual who is responsible for it. Now if
the mistakes are punished too, then there will be fewer mistakes in
future. This takes care of targeting.
Modes of
Delivery
How
government is planning to deliver the benefits of FSB to its
beneficiaries? Is an important question to consider. Now if it
relies on its most inefficient and corrupt PDS then the scheme will
only help the corrupt and corruption. Here again government must
consider technology seriously. Making people buy grains from open
market at prevailing rates and then compensating them for the subsidy
amount through direct transfer of cash to their bank accounts seems
to be a foolproof way of eliminating corruption. Though not all
beneficiaries have bank accounts and also not all have Aadhaar cards
but this is a hurdle that can be overcome easily if one is willing
to. If the government machinery, which is trying its best to not to
let Aadhaar cards reach people, is kept in check and Aadhaar issue is
streamlined, more people can be issued Aadhaar cards in shorter time.
And remember initially only the representative of a family needs to
be given an Aadhaar card. Remaining members can be given the same in
second phase. Making people buy grains from open market is the key to
curb corruption as if the same commodity is priced at 2 levels in the
same market, we end up in pilferage. We have seen this happening with
kerosene and grains distributed through PDS. Also pricing same
commodity at 2 levels is against open markets-free economy. Besides,
the beneficiaries will have better choice to source its grains from
any vendor who meets his requirements. This will also ensure that the
beneficiaries get the grains of better quality.
Also the
government machinery has no infrastructure to handle such huge amount
of grains. Its procurement arm, FCI is also deep in corruption. As
per an estimate of a senior bureaucrat Mr Arvind Virmani, the
'leakage and administrative expenses' of FCI were 40-55%! Now one
cannot expect the same arm of government to procure if one does not
want leakages or such huge 'administrative' expenses! Hence the
procurement, transportation and distribution is best left to private
traders. Considering the huge number of beneficiaries and possible
monetory benefits, the private traders would be more than happy to
participate. They only need to get Aadhaar card readers to verify the
authenticity of beneficiaries. The costs involved are meagre and the
benefit are huge.
The
drawbacks of this scheme
- It will lead to corruption: As we have discussed above, if this scheme is implemented through existing machinery, it will be beneficial to the government machinery rather than 'aam janata' as it will lead to large scale corruption
- It will lead to higher fiscal deficit: The money being pumped in to FS is an investment into completely non productive cause. Hence the return on investment, if any, would be very low. Hence it is clear that the fiscal deficit will rise and economy will be weakened
- It will lead to increased labour costs for farmers: The MNREGS spelled doom for farmers. As every hand, that asked for it, got some work and daily wage. Not only this, many got paid, though less than what was on record, even for not working! At the same time, more than enough grains were available for less than a day's wage of a single man for the whole family to last for a month. This gave enough money in the hands of rural labourers making them reluctant to work. As a direct consequence of this the cost of wages shot up putting big hole in the pocket of farmers. Just consider that the labour charge for collecting cotton boles from cotton field was about 600/Qtl where as the cotton was sold at ` 3800- ` 4000 ! In other words the labour cost for just plucking cotton was nearly 15%. Now consider all costs for seed, fertilizer, insecticides, labour charges etc. The farmer could hardly recover the costs. Now FSB will increase the labour costs even further. It will take away the reason to work hard from labourers. As a common labourer is working to feed his family, now if gets an alternative then the core reason behind his hard working is taken away and he will be reluctant to work any more. This will be disastrous for farmers.
Does this
mean that we ignore the poor and the hungry and the malnourished
people of the country? No, certainly we should not. But handing out
largesse is not the way for sure. Though this a subject of separate
study in details for starters consider following.
- Government should make villages more 'liveable' by providing better schools, road connectivity, medical facilities and safe drinking water. This will ease the burden on cities as people are moving from rural areas to urban areas in search of better living options as the apathy of the government has turned villages into hell
- Government should either provide remunerative prices for farm produce so that farmer makes some money or get away from fixing MSP, procurement of farm produce etc. and leave it to private traders. In the present system, the government puts a lot of restrictions on farmers for sale of farm produce. This is a major reason behind poor state of farmers in our country. If government stops meddling and performs the role of a guardian, the farmer will be able to earn more. This in turn will make villages a better option for labourers who are flocking cities in search of work
- The welfare schemes must be implemented with complete accountability. The system should be such that the culprit must be easy to identify and the punishment must always be given to those who are responsible for any corruption/malpractices
- Poor people who send their kids to schools, who make use of public toilets, who get their kids vaccinated and who work on farm lands should be given incentives. This will ease the burden on cities and make labour available to farmers
- With better infrastructure and profitable agriculture, we can provide jobs to most of the people and this will add significantly to our GDP. Our population is an asset if all hands are given work. And apart from agriculture we do not have any other alternative that can do so.
