Why states' farmer schemes are making deeper inroads than PM-KISAN

Just around 20% of 8.60 crore beneficiaries registered so far under PM-KISAN have received their third installment and the cut-off date is November-end

Manjeet Singh (name changed), a farmer from Punjab’s Tarn Taran, was clueless why he was not able to avail the third instalment of money under the nationwide cash transfer scheme, the Pradhan Mantri Krishi Sammaan Yojana (PM-KISAN). His instalment was rejected due to, of all things, his mother tongue. His Aadhaar authentication failed as records in the bank concerned were in English, but Aadhaar details were in Gurmukhi. Aadhaar seeding—linking it with the bank and the scheme—is a mandatory requirement under PM-KISAN for getting the third installment of Rs 2,000.

But, Manjeet isn’t alone. Latest data shows that by September 20, around 36.1 million transactions for the third instalment got rejected due to difficulties in authentication. The third instalment pertains to August - November 2019. 

“In some places, we received complaints that the beneficiary name is spelt differently on the Aadhaar and in the bank account. This is hindering the seeding process, and cash is not getting transferred,” said a senior official.

So far (till September 28), only 24 per cent of the 73 million registered beneficiaries have received their third instalment, the scheme website shows. Officials contend that the universe has expanded to 86 million now. However, officials are hopeful that the bottlenecks will be cleared by November. A web option for corrections and faster seeding has been introduced to smoothen the process. 

But difficulty in Aadhaar seeding is but one of the several reasons for the slow progress of cash transfers under PM-KISAN. Even for the second instalment (April-July), where Aadhaar seeding was not mandatory, only 57 per cent beneficiaries have received cash. 

In comparison, about 80 per cent of farmer/labourer beneficiaries under Odisha’s Kalia scheme, and Telangana’s Rythu Bandhu, have got their legitimate cash instalments by now, their official data show.

While PM-KISAN promises Rs 6,000 per year in three instalments to each “farmer family”, Rythu Bandhu promises Rs 5,000 per acre per season to each “farm land holder”. Odisha, under Kalia, promises Rs 12,500 per year in a single tranche to every “small and marginal farmer” in the state. 

But why exactly is the central scheme lagging behind similar programmes offered by states? While all of them fall under the category of cash transfer, the ways in which they are implemented vary, and that makes all the difference.

States use data more effectively 

Odisha (Kalia) uses the decadal population Census of 2011, and applies some approximations to arrive at the beneficiary universe.

“The state agriculture department further uses existing data from the paddy procurement database, subsidy repository and food security lists to reconfirm the beneficiaries,” Saurab Garg, principal secretary for agriculture in Odisha, told Business Standard.

In addition, the state department visited all panchayats (villages) and verified data of all farmers and landless labourers in Odisha. 

“We carried out this exercise between January and March, and scrutinised data in the block-level and district-level committees. We received 12 million applications of which 6.4 million have been finalised as beneficiaries, and 5.1 million have received money to date,” said Garg.

This system helped Odisha remove most of the irregularities in data, he said.

Telangana did it differently. It took two years to modernise its land records, invested more public funds in the process. The 2014-born state generated first-hand data on all landholders in the state, envisioning a state-wide farmer scheme back then. Today, more than 92 per cent of farmers already have digitised Aadhaar-seeded pattadar passbooks (land records).

The state department made sure that all entries and relevant agricultural and revenue data for all land holders get filled. 

With a good degree of land dispute resolutions, the accuracy of data has increased from 75 per cent in the summer of 2018, to more than 90 per cent now, said Vakati Karuna, director of land administration in Telangana. 

“We have all land records online, and put transparently on our website. Land parcels where some information is missing are clearly visible on the portal, and helps us fill that gap faster,” she said.

The Centre, on the other hand, used the data from agriculture census, which is carried out every five years. 

The biggest discrepancy in the agri-census is that it is developed from a survey of a sample. Secondly, it captures those cultivators too, who do not have land records, who are share-croppers with or without contract and those just tilling the land.

Though the agriculture census gives the clearest idea of the number of cultivators in the country, experts feel it is not the perfect kind of data to assess beneficiaries at the unit level, due to a dearth of records.

Fund flow crashes despite fall in rejection rate

PM-KISAN was riddled with the problem of high rejection rates in the first instalment pertaining to the December 2018-March 2019 period.

Application of the eligible beneficiary needs to go through certain steps such as validation, making corrections and authentication in the public funds management system (PFMS), which is the payment gateway for all central funds.

But former agriculture secretary Siraj Hussain told Business Standard that the rejection rate has drastically dropped in the current financial year.

“The rejection rate was 75 per cent lower in the second instalment than in the first. Despite this, the cash flow to beneficiaries is lower in the second than the first,” said Hussain.

Maharashtra and Uttar Pradesh led the rate of rejections at the PFMS level at the time of the first instalment, but were able to significantly reduce it at the time of the second.

“You are the beneficiary” vs “Please apply”

The Centre and states differ in the manner in which they communicate with prospective beneficiaries.

States have aggressively made efforts to market their scheme, reach farmers’ doorsteps and get them enrolled in the respective scheme.If any discrepancy arose, the state department ensured that it was solved, so that no eligible farmers was left out. 

The central scheme PM-KISAN, on the other hand, requires the beneficiary to get his bank account and identification details seeded to the scheme.

“Many persons who are counted as farmers in the agriculture census may not want to register themselves as farmers under a certain scheme since they fear losing out on other benefits,” said a government official on condition of anonymity.

“Unnecessary paperwork drove some farmers away while absentee landlords would anyway not turn up,” he said. 

Better the lead time, faster the implementation

Finally, both the states, Telangana and Odisha, spent considerable time in finalising land records, linking bank accounts and Aadhaar.

“The lead time of two years gave us the necessary window to do all the groundwork, which has been the key reason for faster implementation,” said Telangana’s Karuna.

About 92 per cent of Telangana’s land parcels are fully “accounted for” (attached to a land owner) at the moment, and the state expects to reach the 95-97 per cent level soon. The remaining, Telangana officials could be disputed or benami properties.

The Centre, on the other hand, announced the scheme in the interim Budget in February 2019, without much concrete information on the number of beneficiaries it intends to cater to. 

(Some names have been changed to conceal identity)