Why the Centre is right in not extending the Pradhan Mantri Garib Kalyan Anna Yojana scheme?

Source: This post is created based on the articles “Why the Centre is right in not extending the Pradhan Mantri Garib Kalyan Anna Yojana scheme”, published in Indian Express on 26^th December 2022.

“A welcome move” published in The Hindu on 26^th December 2022.

Syllabus Topic – GS Paper 2 – Issues related to hunger and Poverty

News: The Government has decided not to extend the Pradhan Mantri Garib Kalyan Ann Yojana, (PMGKY).

Read – Features of Pradhan Mantri Garib Kalyan Ann Yojana, (PMGKY)

Benefits of PMGKY

First, PMGKY absorbed the shock of the pandemic for the extreme poor.

Second, the scheme has provided distress relief to the neediest and helped the Government control its food buffer stocks better.

Third, it will also reduce wastage of procured food grains at a time when procurement figures for rice and wheat by the Food Corporation of India remain high.

Fourth, the PDS and the PMGKY have also acted as income transfers for the poor by allowing them to buy other commodities that they could not have afforded.

How discontinuation of the scheme is beneficial?

First, the scheme is neither physically nor fiscally sustainable.

Second, the current stocks of rice and wheat in the Central pool, at 55.46 mt on December 1, are a third lower than a year ago. There isn’t that much grain in the Food Corporation of India’s warehouses today to distribute.

What are the alternative announcements made by the government?

Government will bear the expenses under National Food Security Act (NFSA). Under NFSA, the 5 kg/person/month grains would be provided, free of cost for one year from January 2023. NFSA beneficiaries will, henceforth, receive not just subsidized grain but free grain up to 5 kg.

What are the benefits of alternative scheme?

For this new provision, Government agencies don’t need to procure more than 60-65 mt annually. The actual procurement, has averaged 90-100 mt (55-60 mt rice and 35-40 mt wheat) in the recent times. It will handle the overflowing public godowns from excessive procurement.

What more should be done?

Universalization of the PDS can be considered. It has already worked well in a few States such as Tamil Nadu, as the scheme would be availed by anyone in need instead of a flawed targeting system.