Mending the Food Security Act- JEAN DRÈZE(NAC Member working on Food Security Bill )
Varun Gupta
JEAN DRÈZE
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Activists protest at the Planning Commission office against the
National Food Security Bill and recommendations of Tendulkar Committee
in New Delhi on Monday. Photo: PTI
The National Advisory Council has proposed a framework for the
National Food Security Act. But its potential could be wasted by a
flawed approach to the PDS.
Two years have passed since the Central government announced that a
draft National Food Security Act (NFSA) would be posted on the Food
Ministry's website “very soon.” After prolonged deliberations, a
detailed framework for this Act has recently been proposed by the
National Advisory Council (NAC), and a draft is on the anvil. This is
a “compromise draft” of sorts, heavily influenced by the government's
own concerns and priorities.
The NAC framework includes important provisions relating, for
instance, to child nutrition, reform of the public distribution system
(PDS), and redress of grievances. It has the potential to put all
food-related schemes on a new footing, in a rights framework. However,
this potential is in danger of being wasted by a flawed approach to
the PDS.
In this approach, the PDS rests on a three-way division of the
population, among “priority,” “general” and “excluded” households.
(This article focusses on rural areas.) Priority households, covering
at least 46 per cent of the rural population at the all-India level,
are to get 35 kg of grain a month at “Antyodaya prices” (Rs. 3 a kg
for rice, Rs. 2 for wheat and Re. 1 for millets). General households
will get 20 kg at no more than half of the Minimum Support Price. And
excluded households, which account for 10 per cent of the rural
population, will get nothing.
This framework is problematic. First, it hinges on a lasting division
of the population into three groups, without any clarity as to how the
groups are to be identified. In the absence of any obvious
alternative, the NAC is effectively falling back on the Below Poverty
Line census to identify priority groups. This is a major setback — the
NAC's entire work began with a virtually unanimous rejection of
BPL-based targeting for the PDS. Exclusion errors in earlier BPL
censuses were very large, and the next BPL census is unlikely to fare
much better, judging from the pilot survey.
Second, since identification criteria are left to the Central
government, with some discretion for State governments, nobody has
guaranteed PDS entitlements under the Act, except for a few
ultra-marginalised groups (such as the so-called Primitive Tribal
Groups) which have a right of “automatic inclusion” in the priority
list. Other households have no legal entitlement to be included in the
priority list or, for that matter, in the general list. Therefore,
they have no guaranteed PDS entitlements at all. This undermines the
basic purpose of the Act.
Third, the transition from the current Above Poverty Line-Below
Poverty Line framework to the NAC framework is likely to be
disruptive. There are at least three major sources of disruption: the
creation of an “excluded” category; the transition to a new BPL list;
and the switch from household to per capita entitlements. Each of
these changes entails a loss of entitlements for significant numbers
of households. Meanwhile, the entitlements of other households will be
enhanced. Can we expect this transition to happen without major
tensions, or even to be completed at all?
Fourth, the NAC framework fails to “de-link” PDS entitlements from
official poverty estimates, and to prevent a rapid shrinkage of PDS
coverage over time. It is well understood by now that official poverty
lines in India are abysmally low, and that undernutrition is not
confined to households below the “poverty line.” In the NAC framework,
46 per cent coverage of priority groups in rural areas corresponds to
the proportion of the population below the “Tendulkar poverty line,”
plus a margin of 10 per cent for targeting errors. This is
significantly higher than the current BPL coverage of about 33 per
cent. But except for ruling out any reduction of PDS entitlements
before the end of the 12th Five Year Plan (which is only a few years
from now), nothing in the draft NFSA prevents the government from
reducing PDS coverage in tandem with official poverty estimates over
the years.
Fifth, the idea of a universal PDS in the poorest 200 districts was
dropped from the NAC framework (after being agreed and placed on
record). This was an important idea, because any targeting process
here is likely to lead to massive delays, fraud, and exclusion errors.
In many of these districts, the local administration has little
credibility. Large numbers of poor households are outside the BPL
list, and are likely to remain excluded from the proposed “priority”
list. Further, targeting is pointless in areas where an overwhelming
majority of the population is vulnerable to food insecurity. Launching
a universal PDS in these districts would have addressed a large part
of the food insecurity problem in rural India in one go, at a small
extra cost.
Sixth, the NAC abandoned another important idea as it went along: the
automatic inclusion of all Scheduled Caste and Scheduled Tribe (SC/ST)
households in the priority list — unless they come within the standard
exclusion criteria. This will be a major protection against exclusion
errors, and a well-justified form of positive discrimination in favour
of SC/ST families. But the idea was dropped, on the grounds that it is
difficult to reconcile with pre-specified “caps” on the coverage of
priority groups at the State level based on poverty estimates. Punjab,
for instance, has a low poverty ratio but a high proportion of SC/STs
in the population — there is no obvious way to handle this.
In short, the NAC framework not only perpetuates the flaws of BPL
targeting but also institutionalises artificial social divisions under
the law. It is not difficult to imagine the Act being used as a
foothold to extend these divisions to other domains.
The obvious alternative, a universal PDS, is a ‘no-no' for the Central
government. Is there another way to repair, or at least contain, the
damage? I believe there is. Before coming to that, let me mention an
interesting finding of recent BPL identification studies (by Reetika
Khera, Sabina Alkire, and Himanshu, and others). These analyses,
mainly based on the 2004-05 data from the National Sample Survey or
the 2005-06 data from the National Family Health Survey, suggest that
about 25 to 30 per cent of households in rural India meet simple,
transparent and verifiable “exclusion criteria,” such as having a
government job, owning a motorised vehicle, or living in a
multi-storied pucca house.
This suggests a simple but far-reaching modification of the NAC
framework: expand the excluded category, but extend “priority”
entitlements (35 kg of grain at Antyodaya prices) to all other
households. With an exclusion ratio of, say, 30 per cent, the
foodgrain requirements will be the same as in the current NAC
framework. The financial cost will be a little higher (because all
entitled households will pay Antyodaya prices), but the extra cost
will be a small fraction of the total food subsidy.
In this “quasi-universal” framework, every rural household will be
entitled, by law, to 35 kg of grain a month at Antyodaya prices,
unless it comes within the well-defined “exclusion criteria.” Everyone
will be clear about their legal entitlements. The burden of proof, so
to speak, will fall on the government to exclude a household, and poor
households will be well protected from exclusion errors. State
governments will be free to move even closer to universalisation, if
they wish, by waiving some exclusion criteria and contributing
additional resources to the PDS (as many States are already doing).
Automatic inclusion of SC/STs (unless they come within the exclusion
criteria) will be built in. PDS entitlements will be de-linked from
the APL-BPL rigmarole, and from poverty estimates. And while some
social division will remain, it will be “at the top,” without
undermining solidarity among disadvantaged groups.
Two further modifications of the NAC framework will round up this
proposal quite nicely. First, the idea of a universal PDS in the
poorest 200 districts could easily be reinstated, by waiving exclusion
criteria in these districts for an initial period of, say, 20 years.
Second, the Act could be gradually extended to the whole country, over
a period of, say, three years, starting with the poorest 200
districts. This will make it easier to meet the additional foodgrain
requirements in a phased manner.
This approach is not perfect, but it seems much preferable to the
confused, impractical and divisive framework that has emerged from the
NAC (or rather, from protracted discussions between the NAC and the
government). It will be easy to adapt the current NFSA draft to this
approach, while retaining the valuable work that has been done by the
NAC on other aspects of the draft. This small modification could make
a big difference.
(The author is a Visiting Professor at the University of Allahabad.
The views expressed here are his own.)