Note on TPDS

1.         INTRODUCTION      

 

1.         The Public Distribution System (PDS) evolved as a system of management of scarcity and for distribution of foodgrains at affordable prices. Over the years, PDS has become an important part of Government’s policy for management of food economy in the country. PDS is supplemental in nature and is not intended to make available the entire requirement of any of the commodities distributed under it to a household or a section of the society.

 

2.         PDS is operated under the joint responsibility of the Central and the State Governments. The Central Government, through FCI, has assumed the responsibility for procurement, storage, transportation and bulk allocation of food grains to the State Governments. The operational responsibility including allocation within State, identification of families below the poverty line, issue of Ration Cards and supervision of the functioning of FPS, rest with the State Governments. Under the PDS, presently the commodities namely wheat, rice, sugar and kerosene are being allocated to the States/UTs for distribution. Some States/UTs also distribute additional items of mass consumption through the PDS outlets such as pulses, edible oils, iodized salt, spices, etc.

 

2.         EVOLUTION OF PUBLIC DISTRIBUTION SYSTEM.   

 

1.         Public Distribution of essential commodities had been in existence in India during the inter-war period. PDS, with its focus on distribution of food grains in urban scarcity areas, had emanated from the critical food shortages of 1960. PDS had substantially contributed to the containment of rise in food grains prices and ensured access of food to urban consumers. As the national agricultural production had grown in the aftermath of Green Revolution, the outreach of PDS was extended to tribal blocks and areas of high incidence of poverty in the 1970s and 1980s.

           

2.         PDS, till 1992, was a general entitlement scheme for all consumers without any specific target. Revamped Public Distribution System (RPDS) was launched in June 1992 in 1775 blocks throughout the country.        

 

3.         The Targeted Public Distribution System (TPDS) was introduced with effect from June, 1997.

 

3.         REVAMPED PUBLIC DISTRIBUTION SYSTEM (RPDS)       

 

1.         The Revamped Public Distribution System (RPDS) was launched in June, 1992 with a view to strengthen and streamline the PDS as well as to improve its reach in the far-flung, hilly, remote and inaccessible areas where a substantial section of the poor live. It covered 1775 blocks wherein area specific programmes such as the Drought Prone Area Programme (DPAP), Integrated Tribal Development Projects (ITDP), Desert Development Programme (DDP) and certain Designated Hill Areas (DHA) identified in consultation with State Governments for special focus, with respect to improvement of the PDS infrastructure. Foodgrains for distribution in RPDS areas were issued to the States at 50 paise below the Central Issue Price. The scale of issue was upto 20 kg per card.      

 

2.         The RPDS included area approach for ensuring effective reach of the PDS commodities, their delivery by State Governments at the doorstep of FPSs in the identified areas, additional ration cards to the left out families, infrastructure requirements like additional Fair Price Shops, storage capacity, etc. and additional commodities such as tea, salt, pulses, soap, etc. for distribution through PDS outlets.

 

4.         TARGETED PUBLIC DISTRIBUTION SYSTEM (TPDS)

 

1.         In June 1997, the Government of India launched the Targeted Public Distribution System (TPDS) with focus on the poor. Under the TPDS, States are required to formulate and implement foolproof arrangements for identification of the poor for delivery of foodgrains and for its distribution in a transparent and accountable manner at the FPS level.

 

2.         The scheme when introduced, was intended to benefit about 6 crore poor families, for whom a quantity of about 72 lakh tonnes of food grains was earmarked annually. The identification of the poor under the scheme is done by the States as per State-wise poverty estimates of the Planning Commission for 1993-94 based on the methodology of the “Expert Group on estimation of proportion and number of poor” chaired by Late Prof Lakdawala. The allocation of food grains to the States/UTs was made on the basis of average consumption in the past i.e. average annual off-take of food grains under the PDS during the past ten years at the time of introduction of TPDS.

 

3.         The quantum of foodgrains in excess of the requirement of BPL families was provided to the State as ‘transitory allocation’ for which a quantum of 103 lakh tonnes of foodgrains was earmarked annually. Over and above the TPDS allocation, additional allocation to States was also given. The transitory allocation was intended for continuation of benefit of subsidized food grains to the population Above the Poverty Line (APL) as any sudden withdrawal of benefits existing under PDS from them was not considered desirable. The transitory allocation was issued at prices, which were subsidized but were higher than the prices for the BPL quota of foodgrains.

 

4.         Keeping in view the consensus on increasing the allocation of foodgrains to BPL families, and to better target the food subsidy, Government of India increased the allocation to BPL families from 10 kg. to 20 kg of foodgrains per family per month at 50% of the economic cost and allocation to APL families at economic cost w.e.f. 1.4.2000. The allocation of APL families was retained at the same level as at the time of introduction of TPDS but the Central Issue Prices (CIP) for APL were fixed at 100% of economic cost from that date so that the entire consumer subsidy could be directed to the benefit of the BPL population. However, the CIPs fixed in July and December, 2000 for BPL & AAY respectively and in July, 2002 for APL, have not been revised since then even though procurement costs have gone up considerably.

 

5.         The number of BPL families was increased w.e.f. 1.12.2000 by shifting the base to the population projections of the Registrar General as on 1.3.2000 instead of the earlier population projections of 1995. With this increase, the total number of BPL families come to 652.03 lakh as against 596.23 lakh families originally estimated when TPDS was introduced in June, 1997.

 

6.         The end retail price is fixed by the States/UTs after taking into account margins for wholesalers/retailers, transportations charges,  levies, local taxes etc. Under the TPDS, the States were requested to issue foodgrains at a difference of not more than 50 paise per kg over and above the CIP for BPL families. Flexibility to States/UTs has been given in the matter of fixing the retail issue prices by removing the restriction of 50 paise per kg over and above the CIP for distribution of food grains under TPDS except with respect to Antyodaya Anna Yojana where the end retail price is to be retained at Rs.2/ a kg. for wheat and Rs.3/ a kg. for rice.           

 

 

 

5.         IDENTIFICATION OF BPL FAMILIES UNDER TPDS

 

1.         To work out the population below the poverty line under the TPDS, there was a general consensus at the Food Minister’s conference held in August 1996, for adopting the methodology used by the expert group set up by the Planning Commission under the Chairmanship of Late Prof. Lakadawala. The BPL households were determined on the basis of population projections of the Registrar General of India for 1995 and the State wise poverty estimates of the Planning Commission for 1993-94. The total number of BPL households so determined was 596.23 lakh. Guidelines for implementing the TPDS were issued in which the State Governments had been advised to identify the BPL families by involving the Gram Panchayats and Nagar Palikas. While doing do the thrust should be to include the really poor and  vulnerable sections of the society such as landless agricultural labourers, marginal farmers, rural artisans/craftsmen such as potters, tappers, weavers, black-smiths, carpenters,  etc. in the rural areas and slum dwellers and persons earning their livelihood on daily basis in the informal sector like potters, rickshaw-pullers, cart- pullers, fruit and flower sellers on the pavement etc. in urban areas. The Gram Panchayats and Gram-Sabhas should also be involved in the identification of eligible families.

 

2.         The number of BPL families had been increased w.e.f. 1.12.2000 by shifting the base to the population projections of the Registrar General of India as on 1.3.2000 instead of the earlier population projections of 1995. With this increase, the total number of BPL families in the country come to 652.03 lakh as against 596.23 lakh families originally estimated when TPDS was introduced in June, 1997.

 

6.         ANTYODAYA  ANNA YOJANA (AAY)

 

1.         AAY is a step in the direction of making TPDS aim at reducing hunger among the poorest segments of the BPL population. A National Sample Survey Exercise points towards the fact that about 5% of the total population in the country sleeps without two square meals a day. This section of the population can be called as “hungry”. In order to make TPDS more focused and targeted towards this category of population, the Antyodaya Anna Yojana (AAY) was launched in December, 2000 for one crore poorest of the poor families.

 

2.         AAY contemplates identification of one crore poorest of the poor families from amongst the number of BPL families covered under TPDS within the States and providing them foodgrains at a highly subsidized rate of Rs.2/- per kg. for wheat and Rs.3/ per kg. for rice. The States/UTs are required to bear the distribution cost, including margin to dealers and retailers as well as the transportation cost. Thus the entire food subsidy is being passed on to the consumers under the scheme.

 

3.         The scale of issue that was initially 25 kg per family per month was increased to 35 kg per family per month with effect from 1st April 2002.

 

4.         The AAY has since been expanded to cover 2.50 crore poorest of the poor households as follows:

 

 

  FIRST EXPANSION OF AAY         

 

        The AAY Scheme has been expanded in 2003-2004 by adding another 50 lakh BPL households headed by widows or terminally ill persons or disabled persons or persons aged 60 years or more with no assured means of subsistence or societal support. With this increase, 1.5 crore (i.e. 23% of BPL) families have been covered under the AAY.

 

SECOND EXPANSION OF AAY

 

         As announced in the Union Budget 2004-05, the AAY has been further expanded by another 50 lakh BPL families by including, inter alia, all households at the risk of hunger. Orders to this effect was issued on 3rd August 2004. In order to identify these households, the guidelines stipulate the following criteria:

 

i)         Landless agriculture labourers, marginal farmers, rural artisans/craftsmen, such as potters, tanners, weavers, blacksmiths, carpenters, slum dwellers, and persons earning their livelihood on daily basis in the informal sector like porters, coolies,  rickshaw pullers, hand cart pullers, fruit and flower sellers, snake charmers, rag pickers, cobblers, destitutes and other similar categories irrespective of rural or urban areas.        

 

ii)        Households headed by widows or terminally ill persons/disabled persons/persons aged 60 years or more with no assured means of subsistence or societal support. 

 

iii)        Widows or terminally ill persons or disabled persons or persons aged 60 years or more or single women or single men with no family or societal support or assured means of subsistence.

 

iv)         All primitive tribal households.

 

            With this increase, the number of AAY families increased to 2 crore (i.e. 30.66% of BPL families).

 

THIRD EXPANSION OF AAY

 

         As announced in the Union Budget 2005-06,  the AAY was expanded to cover another 50 lakh BPL households thus increasing its coverage to 2.5 crore households. (i.e. 38% of BPL). 

 

        As on 31.12.2013, States/UTs have identified and issued AAY ration cards to  242.646 lakh AAY families. The State-wise estimated number of AAY families and the families identified and ration cards issued under AAY by the State Governments/UTs are given in the Annexure.    

 

5.           The identification of the Antyodaya families and issuing of distinctive Ration Cards to these families is the responsibility of the concerned State Governments. Detailed guidelines were issued to the States/UTs for identification of the Antyodaya families under the AAY and additional Antyodaya families under the expanded AAY. Allocation of foodgrains under the scheme is being released to the States/UTs on the basis of issue of distinctive AAY Ration Cards to the identified Antyodaya families. The allocation for the year 2013-14 (up to December,2013) of foodgrains under AAY was around 8.44 lakh tons.

 

7.       SCALE OF ISSUE OF FOODGRAINS UNDER TPDS.   

            Since 1997, the scale of issue of the BPL families has been gradually increased from 10 kg. to 35 kg. per family per month. The scale of issue to BPL families was increased from 10 kg. to 20 kg per family per month with effect from 1.4.2000. The allocation of foodgrains for the BPL families was further increased from 20 kg. to 25 kg. per family per month with effect from July, 2001.  Initially, the Antyodaya families were provided 25 kg. of food grains per family per month at the time of launching of the scheme in December, 2000. The scale of issue of foodgrains under APL, BPL  and AAY has been revised to 35 kg per family per month with effect from 1.4.2002 with a view to enhancing the food security at the household level.

 

8.       CENTRAL ISSUE PRICE (CIP)

 

The Central Issue Price (CIP) of foodgrains being supplied under TPDS is as under:-

(Figure in Rs. per kg.)

Commodity                 APL                BPL                 AAY

Rice                             8.30                 5.65                 3.00

Wheat                          6.10                 4.15                 2.00

 

9.       ACHIEVEMENTS OF TPDS

 

§  After June 1997,  PDS has now become pro-poor.

§  The urban bias has been completely eliminated as a larger proportion of BPL families are living in rural areas.

§   Though PDS is supplemental in nature, but now the enhanced allocation of food grains fulfils around 50% of the monthly cereal requirement of an average BPL household.

§  In accordance with the commitment of the Government to create a hunger free India and to reform the PDS so as to serve the poorest of the poor,  the AAY scheme was launched in December, 2000. The CIP for AAY category was kept lowest i.e. Rs.2/- a kg. for wheat and Rs.3/- a kg for rice. The number of AAY households have been increased to 2.5 crores.

§   The CIP of foodgrains for BPL families has not been revised since 25.07.2000 and that for AAY since Dec., 2000.

 

10.       TPDS UNDER NATIONAL FOOD SECURITY ACT,2013

 

            The National Food Security Act, 2013 (NFSA) has been notified on 10.09.2013. The coverage, entitlements of foodgrains, etc. under the NFSA,2013 have undergone change as compared to those under the existing TPDS referred above. This Act inter alia provides for coverage of upto 75% of the rural population and upto 50% of the urban population at the all India level under TPDS. Under the NFSA,2013, the priority households are entitled to receive foodgrains @  5 kg per person per month at the issue prices of Rs.3.00, Rs.2.00 and Rs.1.00 per kg for rice, wheat and coarse grains respectively. The existing AAY households, however, will continue to receive 35 kg of foodgrains per households per month.

 

 

11.       MEASURES TAKEN TO STRENGTHEN TPDS  

 

I)                   PDS ( Control) Order, 2001

            In order to maintain supplies and securing availability and distribution of essential commodities, Public Distribution System (Control) Order, 2001 has been notified on August 31, 2001. The Order mainly contains provisions with regard to the following issues:-

 

i.          Identification of families below the poverty line;

ii.         Ration cards;

iii.        Scale and issue price;

iv.        Distribution of foodgrains;

v.         Licensing;

vi.        Monitoring

 

            The Order requires all State Governments/UTs to ensure that the BPL and Antyodaya families identified are really the poorest of the poor. It also requires the State Governments/UTs to get the lists of BPL and Antyodaya families reviewed every year for the purpose of deletion of ineligible families and inclusion of eligible families. It further devolves on the State Governments/UTs to conduct periodical checking of ration cards to weed out ineligible and bogus ration cards. The State Governments/UTs are also to ensure issue of Utilization Certificates confirming that the foodgrains have been lifted and distributed to the intended beneficiaries under the TPDS. An offence committed in violation of the provisions of this Order shall invoke criminal liability under the Essential Commodities Act, 1955.

 

II)                Measures initiated to streamline/strengthen the Targeted Public Distribution System (TPDS).

 (Figures as on 31.12.2013)

            The Department has initiated number of measures to streamline and strengthen Targeted Public Distribution System (TPDS). The measures include: 

A         Measures to strengthen monitoring and vigilance

(i)         Nine Point Action Plan and results achieved

 The nine point Action Plan is under implementation by State & UT Governments since July 2006 as follows: 

1

States should undertake a campaign to review BPL/AAY list to eliminate ghost ration cards

As per the reports received from the State & UT Governments by 31st December, 2013, implementation of the action plan has resulted in elimination of a total of 383.78 lakh bogus/ ineligible ration cards in 29 States. 

2

Strict action should be taken against the guilty to ensure leakage free distribution of food grains

33 States have reported that action is being taken against the guilty to ensure leakage free distribution of food grains.

3

For sake of transparency, involvement of elected PRI members in distribution of food grains be ensured. FPS licenses be given to SHGs, gram panchayats, cooperatives etc.

There is involvement of PRIs in Vigilance Committees to monitor FPS in 29 States/UTs. 

31 States/UTs have reported FPS being run by Gram Panchayats, SHGs, and Cooperatives etc. Out of about 5.15 lakh FPS in operation, about 1.29 lakh FPS are being run by such organisations.

4

Display of BPL and AAY lists by fair price shops

BPL lists at FPS are displayed in 32 States/UTs.

5

Display of fair price shop-wise and district-wise allocations of PDS commodities on web-sites for public scrutiny

Action regarding putting up district-wise and FPS-wise allocation of food grains on websites and other prominent places has been initiated in 22 States/UTs.

6

Door-step delivery of PDS commodities to fair price shops

 

Door-step delivery of food grains to FPS by State Governments instead of letting private transporters to transport goods is being done in 20 States/UTs. This reduces leakages during the transportation of foodgrains and ensures viability of FPS owners.

7

Ensuring timely availability of foodgrains at FPS and distribution of foodgrains by FPS

Action is being taken by 32 States in this regard.

8

Training of Vigilance Committee members

27 State/UT Governments have taken up training programmes for FPS level vigilance committees. Funds are also being provided by Government of India under a Plan Scheme for training of TPDS officers/ officials.

9

Computerization of TPDS operations, use of IT etc.

 

As per reports received from States/UTs, digitization of Stakeholder database has been completed in 29 States/UTs and is progress in 6 States/UTs; Digitization of ration cards/beneficiary database has been completed in 13 States/UTs and is in progress in 17 States/UTs; Online allocation of foodgrains has been implemented in 5 States/UTs and is in progress in 9 States/UTs; Supply-chain has been computerized in 3 States and is in progress in 4 States/UTs; Transparency Portals have been created in 25 States/UTs; Call centre/Toll free helpline number for TPDS have been established in 25 States/UTs and online grievance redressal mechanism for registration and tracking of grievance is available in 18 States/UTs.

            In 2013-14 (RE), Rs.191.76 crore has been allocated, out of which Rs. 155.74 crore has been sanctioned upto 30.01.2014 to 17 States (including funding to States covered partly in preceding year 2012-13 and 2013-14), NIC etc. Thus, a total of Rs. 200.95 crore has been released/sanctioned to 21 States, NIC, etc. under the computerisation scheme during 2012-13 and 2013-14 (upto 30.01.2014).

 

(ii)   Action against those with Bogus Ration Cards

        During the year 2009, all the States/UTs were conveyed a decision of the Government to carryout an intensive campaign from October to December, 2009 to review the existing list of BPL and AAY families and ration cards so as to eliminate bogus ration cards. Further, in view of the directions of the Hon’ble Supreme Court, all States/UTs have also been requested to issue advertisement for surrender of bogus ration cards and penal action against defaulters.

(iii)       Detailed guidelines were issued by the Department for greater involvement of Panchayati Raj Institutions (PRIs) in the functioning of TPDS to bring in more transparent and accountable system of distribution as a measure of social audit. In the guidelines issued in 2005, the States were asked to involve PRIs in the vigilance committees. The instruction has been reiterated to all the States during 2011 also.

B         Increased transparency in functioning of TPDS

(i)         Adoption and implementation of revised Model Citizens’ Charter.

To make TPDS operations transparent and amenable to public scrutiny by use of provisions of Right to Information Act, 2005, a revised Model Citizens’ Charter was issued by the Department in July, 2007 for adoption and implementation by all State/UT Governments. Its speedy implementation was agreed to by all State/UT Food Secretaries in the meeting on 08.02.2008. By now, 34 State/UT Governments have reported adoption and implementation of the revised Model Citizens’ Charter.

(ii)        Introduction of monthly certification of delivery of food grains at price shops and their distribution to ration card holders.  

            To ensure greater transparency in functioning of fair price shops, directions were issued to State & UT Governments in March 2008 to introduce monthly certification by village panchayats/urban local bodies/vigilance committees/women’s Self Help Groups for delivery of food grains to fair price shops in time and their distribution to ration card holders during the allocation month. So far, 23 State/UT Governments have reported on implementation of this monthly certification.

 

(iii)       Publicity-cum-awareness Campaign.

            To facilitate greater public scrutiny of functioning of TPDS, publicity-cum-awareness campaign on TPDS has been taken up under a plan scheme on strengthening of TPDS.  Rs. 59.832 lakh were sanctioned to 7 States including 4 NE States during 2011-12.  During 2012-13, an amount of Rs. 30.756 lakh were sanctioned to 3 States including 1 NE State. During the current year, 2013-14, an amount of Rs. 25.281 lakhs have been sanctioned to the States of West Bengal (20 lakhs) and Sikkim (Rs. 5.281 lakhs).

(iv)       Display of allocation of foodgrains- district and FPS wise on websites for public scrutiny.

            In 22 States/UTs particulars of allocation are being displayed on the State websites.

 

(v)        Allocation of ration upto six months at one go.

The State Governments/UTs have been permitted to lift and distribute upto six months ration under TPDS in one go subject to the condition that there should be no compulsion on the beneficiaries to lift their entitlements and installments should be permitted for those who are not interested or cannot afford to lift the entire quantity. Further, with a view to ensure transparency, the bulk distribution of foodgrains may be made as far as possible in the presence of State Government officials, representative of PRIs, members of Vigilance Committees in Gram Sabha NGOs concerned, etc. Under NFSA, 2013, the entitlements of foodgrains referred in section 3 of NFSA, 2013 are to be distributed to the eligible households through TPDS. Hence, this Department’s instructions regarding advance lifting and distribution of upto six months’ ration under TPDS would apply as well for NFSA allocations, subject to the observance of the terms and conditions stipulated in this Department’s instructions.

C         Use of ICT tools

(i)          Computerization of TPDS Operations.

As per reports received from States/UTs, digitization of Stakeholder database has been completed in 29 States/UTs and is progress in 6 States/UTs; Digitization of ration cards/beneficiary database has been completed in 13 States/UTs and is in progress in 17 States/UTs; Online allocation of foodgrains has been implemented in 5 States/UTs and is in progress in 9 States/UTs; Supply-chain has been computerized in 3 States and is in progress in 4 States/UTs; Transparency Portals have been created in 25 States/UTs; Call centre/Toll free helpline number for TPDS have been established in 25 States/UTs and online grievance redressal mechanism for registration and tracking of grievance is available in 18 States/UTs.

In 2013-14 (RE), Rs.191.76 crore has been allocated, out of which Rs. 155.74 crore has been sanctioned upto 30.01.2014 to 17 States (including funding to States covered partly in preceding year 2012-13 and 2013-14), NIC etc. Thus, a total of Rs. 200.95 crore has been released/sanctioned to 21 States, NIC, etc. under the computerisation scheme during 2012-13 and 2013-14 (upto 30.01.2014).

 

D         Improve the efficiency of FPS operations

(i)         Distribution of wheat flour/fortified wheat flour under TPDS.

To facilitate distribution of wheat flour/fortified wheat flour instead of whole wheat in convergence with other Government programmes/schemes for nutritional improvement

 

 

of targeted beneficiaries, the Department has issued revised policy guidelines on this subject in January, 2008. As on 31.12.2013, 17 States/UTs are distributing wheat flour/fortified wheat flour under TPDS.

(ii)        Allotment of Fair Price Shops to Institutions and Groups.

             As per reports received from the State/UT Governments by end of December, 2013, out of 5,15,108 fair price shops in the country 1,29,037 fair price shops have been allotted to Cooperatives, women’s Self Help Groups, Village Panchayats, Urban Local Bodies and other Self Help Groups in 31 States/UTs.

(iii)       Sale of non-PDS items in FPS

            To make operations of FPS economically viable, the State/UT Governments have been advised to allow FPS licensees to enlarge basket of commodities by allowing sale of non-PDS items for daily use as per local requirements. 14 State/UT Governments have confirmed that FPS in these States are selling non-PDS items such as edible oil, pulses, milk powder, soaps etc.

(iv)    Commission to FPS licensees

The State/UT Governments have been given the flexibility in fixing the commission in respect of foodgrains distributed to APL and BPL categories.  States/UTs have been requested to reassess the commission being paid to FPS dealers and enhance the same so as to increase the viability of FPS operations.

 

III)      REFORMS UNDER NFSA, 2013

            In addition to above, the NFSA 2013 inter-alia contains measures for reforms in TPDS to be undertaken progressively by the Central and State Governments.  These reforms include door-step delivery of foodgrains to the TPDS outlets, application of information and communication technology tools, diversification of commodities distributed under the PDS over period of time etc.  Provisions for transparancy and accountability in TPDS, including disclosure of records of TPDS, conduct of social audit, setting up of Vigilance Committees at the State, district, block and fair price shop levels, grievance redressal mechanism at the district and State levels have also been made in the Act.

 Annexure