Planning Commission clarifies on India's poor

Makes case for Attorney General’s argument before SC.

With the battle over identifying India’s poor moving to the Supreme Court, the Planning Commission has told Attorney General G Vahanvati that the controversial poverty line will not determine the Centre’s liability on subsidised food, but instead will be based on the eligibility limit in the proposed Food Security Act.

“The Central government’s liability will be capped, but the cap will not be the Planning Commission poverty line, but the eligibility limit in the Food Security Act,” Planning Commission Deputy Chairman Montek Singh Ahluwalia said in a letter to the Attorney General, who will appear on behalf of the Commission before the Supreme Court. The apex court is expected to resume hearing on the case tomorrow.

The letter explained that once the Food Security Bill is passed, the identification of the individual households eligible to be in the priority category will be determined by the socio economic and caste census, currently underway.

The Census will give points to households depending on various deprivation parameters. “A cut-off line will then be applied to determine what households are eligible for the benefits.” The cut off line will have to be calibrated to ensure that the total number of households eligible for priority status will be the same as the entitlement under the Bill, said Montek.

He said in a recent joint press conference with Rural Development Minister Jairam Ramesh it was announced that an expert group will be set up to ensure consistency with the Food Security Bill.

The letter also asked Vahanvati if he needed any further clarification.

The draft Food Security Bill as formulated by the food ministry proposes to grant legal entitlement for subsidised grains to up to 75 per cent of the rural Indian households and 50 per cent of urban household. Of this, 46 per cent of rural households will belong to the priority sector category, which can also loosely be defined as akin to the below poverty line (BPL).

In urban areas at least 28 per cent of the population will belong to this category. Together, 41 per cent of the total population of India is proposed to be defined as priority category. This is much larger than the 32 per cent of the population below poverty line as per the Tendulkar committee, the letter explained.

“What this proves is that we are in practice going beyond the Planning Commission poverty line,” said Montek. The Commission had drawn flak from various quarters for its affidavit suggesting that anyone spending more than Rs 26 a day in rural areas and Rs 32 a day in urban areas is not poor.

The letter explained that the Government is considering widening food subsidy benefits well beyond the poverty line.

“We have not mentioned this in our affidavit because we are not the department piloting the bill, but it is public knowledge and has been stated by me publicly. It may therefore (be) appropriate that we inform the Court of these facts in some way and also explain why they are not mentioned in the affidavit,” the letter said.