Thursday, Oct 23, 2014

Govt plans LPG subsidy direct transfer without Aadhaar

To curb diversion of domestic LPG, the government is planning a mechanism to transfer subsidy amounts directly to a consumer's bank account. (Reuters) To curb diversion of domestic LPG, the government is planning a mechanism to transfer subsidy amounts directly to a consumer's bank account. (Reuters)
New Delhi | Posted: July 4, 2014 1:07 pm

To curb diversion of domestic LPG, the government is planning a mechanism to transfer subsidy amounts directly to a consumer’s bank account.

“Direct transfer of subsidy to an individual’s bank account can weed out leakages. The ministry is examining if such a mechanism can be put in place. It will take a few months to roll out,” a senior petroleum ministry official told FE.

But the transfer will not be linked to the Aadhaar platform, as had been previously implemented during UPA rule. The move had led to protests and the Supreme Court ruling that Aadhaar cannot be a must for availing of subsidy.

Under the new proposal, a consumer will have to submit bank account details to the distributor. The subsidy amount would be credited to the savings account as soon as a refill booking is made.

The petroleum ministry official said implementation of Aadhaar-enabled Direct Benefit Transfer for LPG (DBTL) scheme led to savings of nearly R2,800 crore in oil subsidies in FY14, as it weeded out  85 lakh fake/duplicate consumers.

The DBTL scheme covered about 66 million consumers after the programme was launched in June 2013. It was discontinued in January 2014.

In March this year, the Supreme Court directed then UPA-led government to withdraw all its orders that make Aadhaar compulsory for availing services. The three-judge bench headed by Justice BS Chauhan also ordered the Unique Identification Authority of India not to share any information of an Aadhaar card holder with any other agency. In September last year, the apex court had ruled that the card cannot be a prerequisite for public services.

Former finance minister P Chidambaram, during his interim budget speech, reiterated that the DBTL scheme would be rolled out throughout the country.

Money is being transferred to beneficiaries under 27 identified schemes, including the National Social Assistance Programme. Nearly 54,20,114 transactions have been put through until January 31, and R628 crore has been transferred. Another R3,370 crore has been transferred to 2.1 crore LPG beneficiaries. The latter scheme has been put on hold, pending resolution of some difficulties.

The overall under-recoveries of oil marketing companies fell from R1.6 lakh crore in 2012-13 to R1.4 lakh crore in 2013-14 but those on LPG increased from R39,558 crore to R46,558 crore during the period.

Siddhartha P Saikia | The Financial Express

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