6 Jul, 2013

India Promulgates Ordinance To Boost Food Security for the Poor

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President’s Secretariat, 05-July, 2013 – The President of India, Mr Pranab Mukherjee promulgated the National Food Security Ordinance, 2013 today. The Ordinance is a historic initiative for ensuring food and nutritional security to the people. It gives right to the people to receive adequate quantity of foodgrains at affordable prices. The Food Security Bill has special focus on the needs of poorest of the poor, women and children. In case of non-supply of foodgrains now people will get Food Security Allowance. The bill provides for grievance redressal mechanism and penalty for non compliance by public servant or authority.

Highlights. Source: Ministry of Consumer Affairs, Food & Public Distribution

Coverage of two thirds population to get highly subsidised foodgrains

<> Upto 75% of the rural population and upto 50% of the urban population will have uniform entitlement of 5 kg foodgrains per month at highly subsidized prices of Rs. 3, Rs. 2, Rs. 1 per kg. for rice, wheat, coarse grains respectively. It will entitle about two thirds of our 1.2 billion population to subsidised foodgrains under the Targeted Public Distribution System (TPDS.

Poorest of the poor continue to get 35 kg per household

<> The poorest of poor households would continue to receive 35 Kg foodgrains per household per month under Antyodaya Anna Yajna at subsidized prices of Rs 3, Rs 2 and Rs 1. It is also proposed to protect the existing allocation of foodgrains to the States/Uts, subject to it being restricted to average annual offtake during last three years.

Eligible households to be identified by the States

<> Corresponding to the coverage of 75% rural and 50 % of urban population at all India level, State wise coverage will be determined by the Central Government. The work of identification of eligible households is left to the States/UTs, which may frame their own criteria or use Social Economic and Caste Census data, if they so desire.

Special focus on nutritional support to women and children

<> There is a special focus on nutritional support to women and children. Pregnant women and lactating mothers, besides being entitled to nutritious meals as per the prescribed nutritional norms will also receive maternity benefit of at least of Rs. 6000/-. Children in the age group of 6 months to 14 years will be entitled to take home ration or hot cooked food as per prescribed nutritional norms.

Food Security Allowance in case of non supply of foodgrains

<> The Central Government will provide funds to States/UTs in case of short supply of food grains from Central pool, In case of non-supply of food grains or meals to entitled persons, the concerned State/UT Governments will be required to provide such food security allowance as may be prescribed by the Central Government to the beneficiaries.

States to get assistance for intra-State transportation and handling of foodgrains

<> In order to address the concern of the States regarding additional financial burden, Central Government will provide assistance to the States towards cost of intra-State transportation, handling of foodgrains and FPS dealers’ margin, for which norms will be developed. This will ensure timely transportation and efficient handling of foodgrains.

Reforms for doorstep delivery of foodgrains

<> The Bill also contains provisions for reforms in PDS through doorstep delivery of foodgrains, application of information and communication technology (ICT) including end to end computerisation, leveraging ‘Aadhaar’ for unique identification of beneficiaries, diversification of commodities under TPDS etc for effective implementation of the Food Security Act. Some of these reforms are already underway.

Women Empowerment — Eldest women will be Head of the household

<> Eldest woman of eighteen years of age or above will be head of the household for issue of ration card, and if not available, the eldest male member is to be the head of the household.

Grievance redressal mechanism at district level

<> There will be state and district level redressal mechanism with designated officers. The States will be allowed to use the existing machinery for District Grievance Redressal Officer (DGRO), State Food Commission, if they so desire, to save expenditure on establishment of new redressal set up. Redressal mechanism may also include call centers, helpline etc.

Social audits and vigilance committees to ensure transparency and accountability

<> Provisions have also been made for disclosure of records relating to PDS, social audits and setting up of Vigilance Committees in order to ensure transparency and accountability.

Penalty for non compliance

<> The Bill provides for penalty to be imposed on public servants or authority, if found guilty of failing to comply with the relief recommended by the District Grievance Redressal Officer (DGRO).

Expenditure

At the proposed coverage of entitlement, total estimated annual foodgrains requirement is 612.3 lakh tons and corresponding estimated food subsidy for 2013-14 costs is about Rs.1,24,724 crore.

FAQS on the National Food Security. Source: Ordinance Ministry of Consumer Affairs, Food & Public Distribution

Following are the some frequently asked questions on the Food Security Ordinance :-

<> As per the Ordinance, only 67% of the population will be covered under TPDS. Why the coverage cannot be universalized?

The entitlement proposed in the Bill are based on recent trends in production and procurement of foodgrains. The average annual procurement of foodgrains during 2007-08 to 2011-12 has been about 60.24 million tons. In comparision, the foodgrain requirement for covering the whole population under TPDS, even with an entitlement of 5 kg per person per month, is estimated at 72.6 million tons. Requirement for OWS would be additional. It is not feasible to meet such a high level of foodgrain requirement at the current levels of production and procurement.

<> For BPL households, the entitlement of 5 kg. means reduction in what they are currently getting under TPDS? Will it not hurt them?

At present, the TPDS covers 6.52 crore Below Poverty Line (BPL) families, including 2.50 crore Antyodaya Anna Yojana (AAY) families on the basis of population estimates of 1999-2000 of Registrar General of India and poverty estimates of 36% (1993-94) of Planning Commission. The rest of the families are covered as Above Poverty Line (APL). The AAY and BPL families are allocated 35 kg foodgrains per month. Allocation to APL families is subject to availability of foodgrains. The per kg Central Issue Prices (CIPs) of wheat / rice are @ Rs 2/3 for AAY, Rs.4.15/ 5.65/kg for BPL families and Rs.6.10/.8.30/kg for APL families respectively.

As can be seen, only about one fourth of the total estimated households at present have fixed entitlement of 35 kg. per family per month. NFSB on the other hand proposes to give legal entitlement to receive 5 kg of foodgrains per month to about 67% of the population at the all India level. Within this coverage, entitlement of AAY households, which constitute the poorest of the poor, is being protected at 35 kg per household per month. Further, all the households covered by the Ordinance under TPDS will be entitled to receive wheat and rice at Rs.3 and 2 per kg, which is the current AAY price. As a result, the existing BPL households also, who will face reduction in their entitlement in terms of quantity of foodgrains, stand to gain in terms of highly subsidized prices.

<> Why the right to food is restricted to only foodgrains and does not include pulses, edible oils, etc?

There is huge dependence on imports for meeting the domestic demand for pulses and edible oils. Also, the procurement infrastructure and operations for pulses and oilseeds are not strong at this moment. In the absence of assured overall domestic availability of these commodities and weak procurement operations, it is not possible to confer a legal right for their supply. The Government is however implementing schemes for supply of subsidised pulses and edible oils to targeted beneficiaries. Simultaneously, steps will be taken to improve procurement operations for pulses and oilseeds.

<> The Ordinance seems to address only the basic requirements in terms of foodgrains and seems to lack focus on nutritional aspects. How can this then be called a comprehensive approach to food security?

Malnutrition is no doubt a serious issue facing the nation. It is however, not a correct assessment to suggest that the Bill does not address the issue at all. It does seek to address the problem of malnutrition among pregnant women and children which has to be the focal point of our strategy to address this challenge.

There is a special focus in the Ordinance on nutritional support to women and children. Pregnant women and lactating mothers, besides being entitled to nutritious meals as per the prescribed nutritional norms, will also receive maternity benefit of not less than Rs. 6000/-.

Children in the age group of 6 months to 6 years will be entitled to take home ration or hot cooked meal as per the prescribed nutritional standards. Higher nutritional norms have been prescribed for children in the age group of 6 months to 6 years who are malnourished. Children in the lower and upper primary classes will be entitled to nutritious meals in the schools as per the prescribed nutritional norms.

<> Whether the Government has sufficient foodgrains to meet the obligations under the Ordinance?

Total annual requirement of foodgrains, including foodgrains required for other welfare schemes, is estimated at 612.3 lakh tons. Procurement of foodgrains (wheat and rice), both in absolute quantity and in terms of percentage to production, has improved in recent years. The average annual procurement, which was 382.2 lakh tons, i.e. 24.30% of the average annual production during 2000-2001 to 2006-07, has gone up to 602.4 lakh tons during 2007-08 to 2011-12, i.e 33.24% of the average annual production. It will therefore be possible to meet the requirement at the current levels of production and procurement of foodgrains. Even with an estimated marginal decline in foodgrains production in 2012-13, the requirements for the Ordinance will be met.

<> It is argued that the Ordinance will dissuade the farmers, especially the small and marginal farmers, from producing foodgrains as they will be assured to get highly subsidized foodgrains to meet their consumption requirements. Your response?

Production of foodgrains is a means of livelihood for farmers for which they are adequately rewarded by way of MSP for their produce. The reach of MSP is expanding every year and in the wake of the increased requirement for implementation of the Ordinance, more and more farmers will be brought under the ambit of MSP operations. Therefore, contrary to dissuading farmers, the Ordinance will in fact encourage them to produce more.

Access to highly subsidized foodgrains to small farmers on the other hand will ease the burden on their limited earnings and allow them the option to spend the money so saved on other necessities and hence improve their quality of life.

<> States have been complaining about additional financial burden that the legislation on food security imposes on them. How will Central Government bring States on board as it is the States who have to implement the Ordinance?

The main financial implication of the Ordinance would be on food subsidy. At the proposed coverage and entitlement, total estimated annual foodgrains requirement is 612.3 lakh tons and the corresponding estimated food subsidy for its implementation, at 2013-14 costs, is about Rs.1,24,747 crore. When compared to the estimated food subsidy requirement under existing TPDS and Other Welfare Schemes, the additional food subsidy implication is about Rs. 23,800 crore per annum. This additionality will be borne completely by the Central Government.

States had expressed their concernn about additional burden on them, especially on account of setting up of grievance redressal machinery and intra-state transportation of foodgrains, fair price shop dealer’s margin etc. These concerns were based on provisions of the original Bill, which was introduced in Lok Sabha in December, 2011. However, keeping into consideration the recommendations of the Standing Committee and views of the State Governments, the Ordinance now provides that Central Government will provide assistance to States in meeting the expenditure incurred by them on transportation of foodgrains within the State, its handling and FPS dealers’ margin as per norms to be devised for this purpose. Further, with respect to grievance redressal mechanism, the Ordinance gives flexibility to State Governments to either set up separate mechanism or use the existing machinery.

<> In a Central legislation, how fair is it to put the responsibility of payment of food security allowance on State Government?

It is not correct to say that this responsibility is being squarely placed on States. Such responsibility will lie on States only in case they fail to distribute the entitled foodgrains or meals after having received the foodgrains from the Central Government.

Section 22 of the Ordinance provides that in case of short supply of foodgrains from the central pool to a State, the Central Government shall provide the State Government funds for meeting obligations under the Act. The obligation for paying the food security allowance to the ultimate beneficiary, under section 8, is however on State Govts. as distribution of foodgrains/meal as per entitlement will be their responsibility.

<> How soon the Ordinance is expected to be actually implemented by States?

Some preparatory work is required before the Ordinance can be implemented. For example, the actual identification of the households, within the coverage determined for each States/UT under TPDS, is to be done by State Governments, in accordance with guidelines to be evolved/ specified by them. State Governments will therefore be required to first evolve suitable criteria for identification and thereafter undertake the actual work of identification. Allocation and distribution of foodgrains under the Act can take place only after the exercise of identification of households is complete. The Ordinance accordingly provides that State Government shall complete the identification within 180 days after its commencement. This period may however differ from State to State and if any State is ready to implement it early, they will be encouraged to do so.

For the interregnum, the Ordinance contains transitory provisions for continuation of existing schemes, guidelines etc.

<> Any rights based approach can work only if there is an independent grievance redressal mechanism. What does Ordinance provide in this regard?

The Ordinance provides for an effective and independent grievance redressal mechanism at the District and State levels. This will include a District Grievance Redressal Officer for each District to enforce the entitlements and investigate and redress grievances. There is also provision for setting up of State Food Commission, which will either suo motu or on receipt of complaint inquire into violations of entitlements. The Commission will also hear appeals against orders of DGRO and have powers to imposed penalty. Any aggrieved beneficiary can approach these authorities.

<> Identification of households to be covered is proposed to be left to States. Every State will adopt different criteria, leading to a situation of households with same socio-economic condition getting the benefit in one State but not in other State. How desirable is this?

The Bill as introduced in the Lok Sabha in December, 2011 provided that guidelines for identification will be prescribed by the Central Government. State Governments during interaction with them expressed the view that they should have a greater role in determining the criteria for identification of households. The Standing Committee also recommended that Government should devise a clearly defined criteria in consultation with the State Governments. These opinions and recommendations have been carefully considered. Keeping in view the wide inter-State variations in the socio-economic conditions, it was felt that any criteria evolved by the Central Government for the country as a whole may not properly reflect these diversities, and therefore invite criticism. It was also difficult to evolve a consensus with State Government over the issue of criteria to be adopted. Therefore the work of identification is now proposed to be left to States, which may develop their own criteria.