Click here to Download 9 PM Daily Brief PDF (10th Sept. 2016
NATIONAL
[1]. SC to lay down law on LG’s power
Context:- SC has issued notice to the Union on a batch of seven petitions filed by the Delhi government challenging the Delhi High Court’s August 4 judgment
What was HC’s judgment?
On Aug 4, 2016 High Court said that
- Delhi will remain a Union Territory with Lieutenant Governor as its head
- Article 239 continues to remain applicable that makes Delhi a Union territory.
- The appointment of a commission of inquiry into DDCA as well as the appointment of persons to the board of BSES, without the L-G’s permission, were illegal
Now, the question before SC is that, Can LG unilaterally administer Delhi?
Constitutional provision
Article 239: Administration of Union territories
]Save as otherwise provided by Parliament by law, every Union territory shall be administered by the President acting, to such extent as he thinks fit, through an administrator to be appointed by him with such designation as he may specify
- Notwithstanding anything contained in Part VI, the President may appoint the Governor of a State as the administrator of an adjoining Union territory, and where a Governor is so appointed, he shall exercise his functions as such administrator independently of his Council of Minister
Article 239AA: it was inserted by 69th Amendment 1991,
- It excludes Delhi Government from control over land, police and public order
Note: – Delhi has its own assembly which legislates over various matters except few. Although in case of a conflict between a law enacted by the Delhi Assembly and one enacted by Parliament, the latter prevails.
[2]. View degrees in digital format from end of 2017
Context:- Government is now pushing for the creation of an online database (National Academic Depository) where all academic certificates will be available in digital format by the end of next year.
This initiative of the government is a part of the Digital India campaign.
Benefits of NAD
- Privacy: Information about any awards received by the student will be shared with any other individual only after his explicit consent
- Curbing practice of fake degree: Online authentication will ensure that degrees can no longer be faked
- Authentic source of info: NAD will enable recruiters to ensure that the degrees of a candidate are genuine. The practice of attested copies will become a thing of the past, as the database would be an authentic source of secure information about a person’s academic claims.
- No danger of future loss of documents due to inadvertent circumstances as they will be safe and secure in NAD
[3]. Central government seeks citizens’ feedback on simultaneous polls
Context:- The Union government has sought the views of citizens on holding simultaneous elections to the Lok Sabha and the State Assemblies, following a debate sparked by statements made by the Prime Minister and the President
President Mukherjee’s had made some comments on September 5, saying that with some election or the other throughout the year, normal activities of the government come to a standstill because of the Model Code of Conduct (MCC).
5 Questions
The government has invited suggestions on five indicative questions:
- Is it desirable to hold simultaneous elections? What are the pros and cons?
- If simultaneous elections are held, then for the first time what happens to assemblies whose scheduled tenure either ends before or after the proposed date of holding elections?
- Should the term of Lok Sabha and assemblies be fixed?
- What would happen if by-elections are necessary between terms?
- What happens in case the ruling party or coalition loses majority in between term, either in Lok Sabha or in State assemblies?
Benefits of conducting simultaneous elections
- Saving of resources: Simultaneous elections will not only keep alive the enthusiasm of voters, but will lighten the financial and administrative strain on the government and Election Commission machinery.
- Effective governance: It will also avoid the repeated use of Model Code of Conduct under which restrictions are placed on state and central governments with regard to what they can’t do and what they can.
- Policy paralysis: Governments at centre often dilly dally on a particular legislation because polls in one or more states are due. Such a policy shall end with simultaneous conduct of polls
ECONOMY
[1]. Public goods cost may fall on anti-cartelization drive
Context:- Government may be able to save on its massive public procurement expenditure soon, as a growing number of departments and public sector firms are cracking down on vendors indulging in cartelisation and collusive bidding for contracts to deliver public goods and services
What is public procurement?
Public procurement is the process by which government departments or agencies purchase goods and services from the private sector.
To prevent fraud, waste, corruption, or local protectionism, the law of most countries regulates government procurement more or less closely. It usually requires the procuring authority to issue public tenders if the value of the procurement exceeds a certain threshold.
- Public procurement expenditure accounts for around 30 per cent of India’s gross domestic product. By reducing practices like collusive bidding and cartelisation, government can save a huge amount of expenditure
What is collusive bidding?
It refers to agreements by contractors or suppliers in a particular trade or area to cooperate to defeat the competitive bidding process in order to inflate prices to artificially high levels. It can occur in large and small contracts.
Example: Before filing of tenders, two or more suppliers will meet. They will decide amongst themselves that price A will be the lowest price that is going to be offered at the particular bid and no one will bid any lower than that. Similarly, an inflated high price is also fixed, say price B. No one quotes higher than this price. The overall impact is that, tender gets sold for a higher price resulting in loss to government agencies during public procurement. This type of collusive bidding is illegal in India.
What is cartelisation?
An agreement between competing firms to control prices or exclude entry of a new competitor in a market to increase individual members’ profits by reducing competition. It is a formal organization of sellers or buyers that agree to fix selling prices, purchase prices, or reduce production using a variety of tactics.
- Such cartelisation is usually seen in markets where the number of sellers is small or sales are highly concentrated and the products being traded are usually commodities i.e. an oligopolistic industry.
- Collusive bidding is also a tactic that such cartels employ
What is Competition Commission of India?
The Competition Act, 2002, as amended by the Competition (Amendment) Act, 2007, follows the philosophy of modern competition laws. The Act prohibits anti-competitive agreements, abuse of dominant position by enterprises and regulates combinations (acquisition, acquiring of control and M&A), which causes or likely to cause an appreciable adverse effect on competition within India.
- The objectives of the Act are sought to be achieved through the Competition Commission of India (CCI), which has been established by the Central Government with effect from 14th October 2003. CCI consists of a Chairperson and 6 Members appointed by the Central Government.
- It is the duty of the Commission to eliminate practices having adverse effect on competition, promote and sustain competition, protect the interests of consumers and ensure freedom of trade in the markets of India.
- The Commission is also required to give opinion on competition issues on a reference received from a statutory authority established under any law and to undertake competition advocacy, create public awareness and impart training on competition issues.
[2].Microfinance sector could treble in 4 years
Context:- The country’s microfinance sector will grow nearly three-fold to reach up to Rs 4.3 trillion over the next three years on account of expansion into newer segments and enhanced average loan sizes
What are Microfinance Institutions (MFIs)?
A microfinance institution is an organization that offers financial services to low income populations. Almost all give loans to their members, and many offer insurance, deposit and other services
ome agencies in India that are involved in microfinancing work are,
- National Housing Bank: It was set up in 1988 to refinance home loans and regulate housing finance companies
- National Bank for Agriculture and Rural Development: It was set-up in 1982 by a law to regulate credit support, institutional development and encourage innovative initiatives in rural sector. It also promotes sustainable agricultural practices.
- Small Industries Development Bank of India: It was set-up in 1990 to promote, finance and develop small and medium enterprises and provide them easy finance up to a limit of Rs. 1 Crore.
EDITORIAL
[1]. Dark clouds over PDS
Context:- The imposition of Aadhaar-based biometric authentication in the Public Distribution System threatens to disrupt recent progress with PDS reforms. It also deprives millions of people of essential food entitlements.
Author talks about the recent progress made in the Public Distribution System in India especially in Chhattisgarh, which completely overhauled its ailing PDS system, to emerge as a role model for other states
What steps were undertaken by Chhattisgarh to revive its PDS system?
- Broad coverage
- Clear entitlements
- De-privatization of PDS shops
- Separation of transport agencies from distribution agencies
- Computerization,
- Fixed distribution schedules
- Tight monitoring &active grievance redressal
The Chhattisgarh model
It was learned later that the Chhattisgarh model can be followed too.
- Odisha became the 1st state to emulate that model and produced similar results & success
APL problem
Survey conducted by the author in 2011 & in 2013 displayed that Below Poverty line families were getting 84% of their quota but high leakages still continue in Above Poverty Line (APL) quota
National Food security Act
Under the NFSA, the APL category is abolished and eligible households come under two well-defined categories:
- Priority households, entitled to 5 kg of foodgrains per person per month at nominal prices, and
- Antyodaya households (the poorest), entitled to 35 kg per household per month.
Aadhar-based authentication: An impending Setback
Author says that when he went back to India’s six of the poorest states i.e. MP, Jharkhand, Bihar, Chhattisgarh, Odisha, WB, it was found that PDS in every state was functioning much better than few years ago. Situation has improved vastly as compared to previous years but all this progress is in danger of being undone soon due to the Central government’s counter-productive push for Aadhaar-based biometric authentication in the PDS.
- A PoS (Point of Sale) machine is installed at PDS centres and identities of the cardholders are verified by matching their fingerprints against the Aadhaar database over the Internet before giving them their quota.
Problem
Such an authentication procedures is inherently risky as it is based on multiple factors working simultaneously
- PoS machine
- Internet connectivity
- Network strength
- remote servers
Often people have to make repeated trips to the PDS shop, or send different members in turn, until the machine cooperates. Sometimes schoolchildren are asked to skip classes and try their luck at the PDS shop.
Rajasthan
The use of PoS machines is compulsory in Rajasthan and every PDS shop has one. Yet, according to official data compiled, only 61 per cent of Rajasthan’s foodgrain allocation found its way through the PoS system in July 2016, with a similar figure (63 per cent) for August. The rest is either siphoned off or delivered using the old “register” system.
Ranchi
In Ranchi district in Jharkhand PoS system is also mandatory. In July 2016, NFSA cardholders in Ranchi district received less than half of their foodgrain entitlements through that system, according to the model website mentioned earlier.
Author says that in above cases dealers are forced to resort to older method of register entry, which is prohibited. This is causing leakages in the PDS system again.
Aadhar not compulsory
As per SC’s directive Aadhar is not mandatory, yet government is pushing for biometric based authentication making it compulsory for PDS users.
Aadhar can’t solve the problem of PDS leakages in present form
PoS machines verify the identity so they can only prevent an identity fraud not quantity fraud wherein dealer gives less than entitled quota to the people. This doesn’t justifies depriving people of their food entitlements when the technology fails.
Conclusion
Government should not push for technology driven solutions without looking into the ground evidence. The drive to impose biometric authentication on the PDS must stop immediately to avoid further damage. There are better ways of plugging last-mile leakages, including the use of simpler technologies not dependent on the Internet. Imposing a technology that does not work on people who depend on it for their survival is a grave injustice.
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