Extended food scheme raises poll code question
All parties promise major sops before elections, but this was a bumper one. A few days ago the prime minister announced while campaigning in Chhattisgarh that the government would extend the free foodgrains scheme announced during the pandemic—the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY)—for 800 million poor people for another five years. No populist measure works better than free food and this one is likely to have a strong bearing on the state elections in progress. Before the pandemic, heavily subsidised foodgrains were distributed under the National Food Security Act (NFSA). When the pandemic struck, PMGKAY added to it by providing 5 kg of foodgrains per person per month for free. The scheme was then amalgamated into the National Food Security Act in December 2022 and extended by a year. It was to end next month.
The five-year extension has caught even those in government by surprise. It is a mega scheme covering 60 percent of the population for five years. Given how these things work, the PMGKAY is likely to become a permanent feature. At the current procurement prices, it is expected to cost the exchequer ₹2 lakh crore a year. The government has been denying the extension would have any major fiscal impact. But the fiscal deficit for the first half of this financial year has already increased over last year.
The extension has thrown up serious questions. The government has routinely denied that poverty is a serious problem. It has claimed that 135 million people have been lifted out of poverty over the last five years. But then isn’t extending a free foodgrains scheme to so many people an admission that poverty continues unabated? The World Bank says extreme poverty in India (defined as an income of $2.15 a day) had fallen from 39.9 percent in 2004 to 12.7 percent in 2019. If that is the case, does it justify giving free foodgrains to such a large part of the population? The fact is poverty numbers are largely underestimated; so is the number pushed into poverty during the pandemic. Besides, as much as 40 percent of our population is outside the NFSA net. So continuing with the free food scheme is justified. The other question is political. The opposition is now complaining that the announcement of the scheme’s extension in a poll-bound state violated the model code of conduct. The Election Commission’s decision would be interesting.