Direct cash transfer not possible in West Bengal, says minister

The state government recently told the Centre with only 19% of West Bengal's population being covered by the Aadhaar card

The Union government has set ambitious plans for its direct cash transfer scheme, but West Bengal is in no mood to implement it immediately.

The state government recently told the Centre with only 19 per cent of West Bengal’s population being covered by the Aadhaar card, or unique identification numbers, so far, it would take at least two years before the scheme could be implemented in the state.

“We feel direct transfer of benefits will lead to unemployment. Moreover, only 19 per cent of West Bengal is currently covered by the Aadhaar card. The central government is taking no initiative to increase the penetration. It will be difficult to implement the scheme over the next two-to-three years. We are always opposed to the scheme,” said Jyotipriya Mullick, minister for food and supplies, West Bengal.

Ironically, even if West Bengal is opposed to direct subsidy transfer, the state has been following the footsteps of the Central government in payment against paddy procurement in the state. When it came into power in 2011, the Trinamool Congress had abolished the system of payment to farmers through rice mills for their produce, as prevalent in the earlier Left Front regime. The state started facilitating payment directly to the farmers by cheque. However, with a large number of farmers not having bank accounts and long delays in payments, there have been complaints about the modalities of payment.

Under the direct benefit transfer scheme, the government will transfer cash benefits like scholarships, pensions, and MGNREGS (Mahatma Gandhi National Rural Employment Guarantee Scheme) wages directly to the bank or post office accounts of identified beneficiaries, based on the unique identification number. The National Committee on Direct Cash Transfers has decided the scheme would be rolled out in 43 districts by March 1. The purpose of the scheme is to ensure that benefits go to individual’s bank accounts electronically, cutting down delays and diversions.

So far, the scheme has been rolled out in Karnataka, Maharashtra, Delhi, Rajasthan, Madhya Pradesh and Punjab and the Union Territories of Puducherry, Chandigarh and Daman and Diu. Once the programme has stabilised in 43 districts, the government had planned to roll it out in phases in other parts of the country over 2013.

Apart from the Aadhaar card, streamlining the banking system has also been an uphill task for implementation of the direct subsidy transfer scheme. While initially beneficiaries will be able to withdraw cash from their own bank branches or ATMs (automated teller machines) or business correspondents (BCs).

The government plans to introduce the system of micro-ATMs and multiple BCs, with full inter-operability, to streamline the banking system.