NAC members raise concerns over direct benefit transfer scheme-Anuja & Liz Mathew

-Live Mint

Concerns raised over the efficiency of banking networks and on-the-ground preparations for the scheme

A section of the Sonia Gandhi -led National Advisory Council (NAC) is not happy with the government “rushing into” the direct benefit transfer (DBT) scheme, expected to be the flagship programme of the ruling Congress party in the national election scheduled for next year.

At a meeting of the NAC on Tuesday, where Unique Identification Authority of India (UIDAI) chairman Nandan Nilekani made a presentation on Aadhaar and DBT, some members flagged concerns on the efficiency of banking networks and on-the-ground preparations for the scheme. They argued that no public services should be denied to those who do not have an Aadhaar number.

According to five members in the 11-member committee, the members warned the scheme cannot be implemented in a hurried manner without proper mechanism and preparations.

“State governments, ministries and departments should not rush into direct cash transfers without assessing whether or not they are appropriate and whether the preconditions are in place,” said A.K. Shivakumar, NAC member, adding that a legal framework within which the identity numbers are being issued needs to be in place.

 

The United Progressive Alliance government, which has been in election mode for some time now, recently launched the DBT, which aims to directly transfer cash subsidies using Aadhaar to beneficiaries of several government welfare schemes. A pilot was rolled out in 20 districts for 26 schemes on 1 January. Finance minister P. Chidambaram and rural development minister Jairam Ramesh announced that programme from a party platform, which indicated the Congress’ intention to use it as an election plank. Party leaders also coined a slogan for the scheme, “Aapka paisa aapke haath” (your money in your hands), an indirect reference to Congress’ election symbol.

Nilekani told the members that 280 million Aadhaar numbers have been issued so far and by 2014, the authority expects to enrol 600 million people. DBT is expected to plug leakages, reduce wastage and bring down discrepancies in the beneficiary list. However, the members also raised questions about making Aadhaar compulsory. “The council appreciated UID as a concept but some issues were raised. The main concern was that while UID was voluntary, the interpretation made at the state level was that it was mandatory for access to certain social service schemes. While it is not intentional, it is playing out differently on the ground,” said Mirai Chatterjee, member of the council.

 

Another NAC member N.C. Saxena said that while in general there was a view that Aadhaar was a “good scheme”, there were transition problems and the ministries should not be in a hurry to make it compulsory.

 

Another member who did not want to be identified said that concerns over the banking network and linkages to it were also raised.

 

NAC member Aruna Roy was critical of the scheme, saying in the meeting that the idea of DBT was an “experiment on the poor” and a “failed experiment being pushed through”.“The new architecture of using the UID to access existing cash benefits through the bank has only added an extra layer of complicated and complex procedures and has burdened both the programme as well as the beneficiary with little apparent advantage,” a release from Roy’s office quoted her as saying.

 

In response to concerns that UIDAI had not been given legal sanction by Parliament, Nilekani’s presentation highlighted that the authority has been functioning under executive notification issued by the Planning Commission in 2009, which is valid under law, the same member said. The Bill pending before Parliament is just to strengthen the authority by giving it statutory status in order to impose obligations and penalties, Nilekani said in his presentation.

 

A senior government official aware of the development, who did not want to be identified, said most of the NAC members were supportive. However, concerns raised by some on operational issues related to cash transfer were legitimate. “They are being addressed,” the official said.

The Congress is pushing the DBT scheme as one of its key achievements. In the presidential address last week listing the government’s agenda for the coming year, Pranab Mukherjee said it will be a “trendsetter” and will “cut leakages, bring millions of people into the financial system and lead to better targeting of beneficiaries”.

Surabhi Agarwal contributed to this story.