Scheme for direct cash subsidy to be launched

Prime Minister Manmohan Singh has set up an architecture comprising a ministerial committee under him besides a few other panels which would ensure time-bound implementation of the project leveraging the Aadhar scheme.

Government spends a huge amount of Rs 3,25,000 crore annually on subsidies and the new scheme is intended to check corruption and pilferage of subsidised items including diesel, LPG and besides leakages in other schemes like MNREGA, pension and scholarships.

"In a move to cut down wastage, duplication and leakages and enhance efficiency, the Prime Minister has given a major push to transfer individual benefits from the government directly into the bank accounts of beneficiaries," a PMO statement said.

"This is to be done in fast-track, accelerated mode to be achieved in a time-bound manner. The idea is to move to a completely electronic cash transfer system for the entire population," it said about the scheme.

The amount of cash to be transfered electronically to the beneficiaries is to be worked out.

Against the backdrop of corruption and pilferage in various schemes, the government has been thinking about direct cash transfers to genuine beneficiaries to plug leakages as it is expected to bring down the subsidy burden.

The issue of direct cash transfers was discussed at the meeting of the Planning Commission held earlier this month to finalise the 12th Plan as pilot projects have been successful in some states like Chhattisgarh, Andhra Pradesh, Karnataka, West Bengal, Tamil Nadu and Punjab. (MORE)