PDS consumers can soon have choice to buy goods

New Delhi: PDS consumers will soon have a choice to either get subsidised goods from their preferred locations or receive cash, with the government accepting in principle suggestions of the Nandan Nilekani-headed task force on revamping the Public Distribution System.

These suggestions form a part of the report of the task force on 'IT strategy for the PDS' submitted to the Finance Minister Pranab Mukherjee today.

After presenting the report to Mukherjee, UIDAI Chairman Nilekani said the government has in principle accepted the report of the task force and "it (government) will now process the report and take appropriate action".

While suggesting a two-phase strategy to revamp the PDS network, the task force said it is desirable the beneficiaries are provided choice of location and mix of commodities and quantities. They can also opt for direct cash subsidy.

Under the current system, a consumer can only buy goods from an assigned ration shop in set quantities.

There are about 4.62 lakh fair price shops (FPS) which distribute commodities, like wheat, rice, sugar and kerosene, worth over Rs 30,000 crore every year to 18 crore families.

To check pilferages in the PDS, the task force has suggested extensive use of IT platform and Aadhar-based bank accounts for providing subsidised food or cash transfers.

Recommending an institutional mechanism for end-to-end computerisation of PDS, the task force has also suggested creation of a National Information Utility or Public Distribution System Network (PSDN) by April 2012 and initiation of pilot projects by December 2012.

The report said Aadhaar (unique national identity card) can be used in PDS to simplify a number of processes.

The focus in the first phase will be on information visibility and transparency, the report said, adding computerisation of ration card is essential.

Aadhaar integration will be implemented in phase II, when sufficient Aadhaar coverage has been achieved.

Nilekani said, "the large focus of the report is to make system more efficient (and) to make sure people have choice." The report pointed out that true PDS beneficiaries suffer due to "wholesale problems such as large-scale pilferage and diversion...duplicates and ghost beneficiaries, wrongful exclusion and inclusion."

Mukherjee asked the Ministry of Consumer Affairs and Food and Public Distribution to examine the recommendations for implementation in a time-bound manner and, if required, to seek the guidance of the EGoM for unresolved issues.

"Participation of states in the PDSN would be voluntary and would not hamper the current efforts in computerisation of the PDS in states," the Finance Ministry said in a statement.

The report talks of effective computerisation as a must to achieve the scale, speed, cost-effectiveness, and quality in operations, while respecting the federal structure of the country.