PMO says cash transfer scheme needs robust check

Emphasises need for digitisation of databases, re-engineering of funds flow to ensure transfer of funds to beneficiaries and real-time monitoring

With Prime Minister Manmohan Singh detecting faults in monitoring of the Direct Benefits Transfer (DBT) scheme, his office has asked all ministries concerned to put in place a robust tracking system of the ambitious subsidy programme.

The Prime Minister’s Principal Secretary, Pulok Chatterji, has written to Secretaries, ahead of the roll-out of Phase-II of DBT on July 1, emphasising the need for digitisation of databases and re-engineering of funds flow to ensure transfer of funds to beneficiaries and real-time monitoring.

He referred to the PM's comments that DBT implementation has '”revealed the poor nature of tracking and monitoring systems we have in departments”.

“Each department must, therefore, put in place a robust monitoring system that can monitor coverage of beneficiaries and the transfers that are taking place.”

Citing the decisions taken at a meeting chaired by the Prime Minister on April 5, Chatterji wrote, “There is adequate time to prepare for the next phase of roll-out. Every department implementing DBT is expected to begin work without any delay so that the roll-out takes place as decided.”

He asked the departments to pay “particular attention” to the activities which are on the “critical path” for the roll-out when 78 districts would be covered, in addition to the 43 covered in Phase-I.  

With regard to “re-engineering” for DBT funds flow, the Prime Minister’s Principal Secretary said it is essential to ensure direct transfer of funds to beneficiary accounts and real time monitoring. “It is important that process re-engineering is completed in time for Phase-II,” he wrote.

To emphasise the point, Chatterji referred to the Prime Minister's comments that 'DBT requires process re-engineering at the government level. We need to change the way we transact business, the way we release funds, the way we track funds and the information we have on beneficiaries'.     

About digitisation of beneficiary databases, he wrote that "this has been an important challenge in the first phase (rolled out on January one)" as absence of digitised databases hampers other steps in DBT.     "You may like to initiate work on preparation of digitised databases across all districts, not just those covered in Phase-II, so that the rollout happens on time," Chatterji told Secretaries of the central government departments concerned.     

He next phase of rollout, marking total coverage of 121 districts in the country, will include three pension schemes managed by Rural Development Ministry.     LPG subsidy will be rolled out in 20 districts from May 15 this year.