ppt on public distribution system

7/29/2019 ppt on public distribution system

1/12

Improving reach and efficiency of the PublicDistribution System

Prepared By:-

Apoorva Mishra

Maulin Shukla

Tarun Tiwari

Trisha Jhaveri

Varun Pradhan

PLUGGING THE LEAKS

College: Institute of Technology,Nirma University


2/12

Indian government pays a subsidy of 15.7 rupees per kg and yet only 10% of the

poor are able to receive benefits offered by Public Distribution System

Problem Scope:-

It causes widespread malnutrition and starvationproblems due to hunger.

It leads to corruption to the tunes of 20,000 crorein the system.

Subsidy provided by the government is beingwasted as the beneficiaries are not able toreceive any.

With the implementation of food security bill theproblems in the present system are bound to rise

Causes :-

Leakage of goods during transportation andbecause of system failure.

Impractical Fair Price Shop(FPS) causingfailure in distribution system and also leading tosquatting of goods by the owners.

Lack of government vigilance and monitoring inthe system.

Improper identification of the beneficiariesleading to high inclusion and exclusion error ofBPL people.

As a resul t, at present, a developing nation such as

ours is facing malnu tri tion and death fr om starvation

main ly because of insuff icient PDS. Consequentl y, we

have on one side grains rotti ng in godowns and on the

other people dying of hunger. Clearly indi cating that

there is a dir e need to evolve the present system and

ensure that everyone gets what they are entitled to.


3/12

Proposed Solution

Introducing government owned smart

stores which will replace the

traditional and not at all viable fair

price shops.

Counting of BPL people in census,reducing the exclusion and inclusion

net, and at the same time bringing

down fraudulent cases.

Providing smart food cards instead of

the old age ration cards to reduce the

concept of ghost cards.

Maintaining a vigilant monitoring

system to ensure an efficient public

distribution system

Advantages over current

system

As the stores will be government owned,leakages from fair price shops andcorruption will reduce to a great extent.

Smart cards and smart stores will reducemalpractices and corruption, increasingthe reach of supplies

The system will be less costly and moreefficient than the existing one.

There will be less error in BPL and APLcalculation as data from the census isused. This further will reduce fake

entries and will ensure the usage of onecard per family.

Reducing number of store from 5 lakh to30,000 by using technology andincreasing efficiency.

The current PDS corruption estimate is around Rs. 20,747 crore

which calls for an immediate need to overhaul the whole PDS

system...


4/12

The first step of leakage starts at transportation level, hence plugging it becomes a

foremost priority...

Implementing :STAGE 1:

FCI works as the central authority

buying grains from the farmers

and then distributing it throughout

the country. Right now we face

20 % leakage during

transportation and thus, to

combat the same we introduce

tagging of goods with barcodes.This makes it possible to keep

track of the exact items dispatched

before being loaded into trucks

which will then be tallied when

the stock is received. Plus, later

when sold, they are entered in the

data via barcode entries to keep acheck over measuring leakages.

Roughly a barcode system costs

around 60,000 -90,000.

FCI

[BUYS GOODS]

Goods coded

with Barcode

TransportationSmart shops

Tallying with

masterdatabase of FCI

CVC and

Monitoring

authority


5/12

The Planning Commission deemed only 23% of the ration shops as viable. So, an

alternative to them is presented as Smart Stores.

STAGE 2: [Smart Stores]

The stores will be owned by the Government having a linked warehouse for storing goods .They will be equipped

with computers, barcode systems, CCTV monitoring etc. The store will have a total of 9 employees(3 computer operators and 6 helpers) and 3 counters.

Handling capacity of the store:

- It has been assumed that each person will take about 2 minutes to collect ration from the store.

- The store will remain open for 10 hr each day.

- Breaks and holidays will be given on rotation basis.

Smart store

Handling capacity permonth=27000*

Counter 1

Handling capacity=30*60*10/2

=9000

Counter 2


=9000

Counter 3


=9000

*Maximum handl ing capacity comes out to be 27,000 per month but keeping in mi nd all the operating errors

handl ing capacity roughly comes out to be 20 to 22,000.


6/12

10 crore ration cards exist for 6.5 crore BPL families; hence the problem of

identification is leading to high errors. We need to ensure that supplies reach

those is genuine need.

Allocation of stores Stores are to be located all across the country on

the basis of population density index of the

area. So ideally the total number of stores

required will roughly be =

40 crore(targeted population)/22,000 (maximum

handling capacity) = 18,200

Identification of beneficiaries

Total stores

allocated

There should

be at least one

store located

in a radius of 7

km

Handling

capacity of the

store should be

at least

15k.(minimum

70% efficiency)

If either of these criteria are not met the number of

counter per store are reduced from 3 to suit the area

population density. This reduces our inventory cost at the

same time ensuring accessibility to all the beneficiaries

To ensure no beneficiaries are excluded and no falsebeneficiaries are included we suggest adding house

hold income as a stringent part of the census of India.

Problems Solved by using Census

The census volunteers will take the certified

income of household and depending upon that

will mark them down as APL or BPL.

Instead of current system for deciding BPL we suggest

keeping in mind the inflammation factor and area wise

income distribution while making calculations. Thuskeeping it as a dynamic factor rather than present static.

This will help in reducing the inclusion and exclusion

net error which at present stands at 25% and 61%

respectively.

STAGE 3:


7/12

Smart Cards

We suggest using smart ATM type food cards instead of the present

old age ration cards.

There will be a unique card for each household, containing all

family data and income allocated through the census, and alsobiometric data such as iris or fingerprints for unique identification.

This way there is no possibility of creating ghost cards

They will be used by the user at his or her allocated store to collect

his quota of grains on a particular day of the month inscribed on the

card (this way there is even distribution among shops and working

days)

A backlog date will be provided to the users if the miss out on the

original one due to some reason.

Benefits

All data stored digitally and record of sales kept and

tallied to ensure that there is no foul play

Only a family member can use the card and as routinewill tally the data, thus not allowing card laundering

and making sure that the goods reach the right hands.

Since it can be used only once in a month, no one can

take more than their share.

Process will be smooth and easy to manage with all

records kept online and cross checked from time to

time.

In case the beneficiaries change places a simple

process by the present store operator will shift them to

the other store database.

Monitoring System

STORE

Will have CCTV

manifested tomaintain thesecurity of goodsand propermeasurementstandards to befollowed

HELPLINE NUMBER

Will be set up on

which a complaincan be registeredany time. It will beoutsourced to anoutstation BPOensuring fair playand quick action

CITY OFFICER

Two will be appointedfor a district. Will verify

the complains and thenreport them to statehead of CVC forrequired action to betaken. Will beresponsible for anythinghappening in storesunder their area.

SURPRISE RAIDS

May be conducted

by the FCI and CVCfrom time to time tokeep a check on theproceedings andrunning of thestores.


8/12

.

Building our Food Army

Management of vigilance committee:-FCI will setup a vigilance and monitoring committee in collaboration with CVC.

This will include appointing a state and union territory head for the system reporting directly to the chief of CVC.

Every state head will have under him a team of officials recruited by state government civil services especially for

monitoring PDS.

There will be 2 officials per district who will investigate and verify all the complaints made by the people against the

store operating staff.

Management of Stores:-First tie up with a renowned consulting company to recruit store computer operator in define period of time.

Arranging a workshop for all operator to accustom them with new system

Employing helpers under MGNREGA to increase employment

Operators to be transferred time to time to ensure transparency

Management of Transportation system:-Privatizing the whole transport network outsourcing it to a recognized transportation company


9/12

.

Barcode ,smart card and CCTV implementation cost

=30000*30000+50 Crore(smart card)=80 crore

Store construction and renovation cost

=5lakh*30,000(no. of stores)=1500 crore

Store management cost(employees salary and storeresources)

=(3*2 lpa+6*0.8lpa+1lakh)*30,000=3600 crore

Vigilance and Monitoring System(officials salary andBPO)

=35*8LPA+546*LPA*2+200 crore=250 crore

EstimatedTotal Cost

5450 crore

Cost remaining an important factor, we aim to bring it down, simultaneously

ensuring that the efficiency and the ability of our system is not compromised.

Technology cost

Inventory cost

Organizational

cost

Currently 5 lakh fair price shops are working and as per the data of planning commission each shop owner

is paid a subsidy of 5 Rs which generates an average income of Rs 3lpa per store. Thus, current working cost

of the whole system roughly comes out to 15000 crore.

We reduce it substantially by bringing down the number of stores to 30,000 ;simultaneously increasing

their efficiency manifolds to maintain the balance.


10/12

We have one of the worlds largest distribution system affecting nearly 400

million people which is bound to be doubled to 800 million , therefore we

require the most efficient system possible.

Impacts

The proposed solution willoverhaul the present system andis bound to effect the reach ofPDS nearly targeting 40 crorepeople.

This will reduce the problems ofhunger and malnutrition and will

provide our people with the Rightto Food.

High and vigilant monitoring willensure the right use of subsidy.

It will reduce the number of storesby at least 5 times hence cuttingdown on Government expense byroughly 60% .

Also it will create around a lakh ormore new jobs for our youth.

It can also be amended toimplement the new food securitybill easily.

Reach

It is expected to cover the entire BPL population ensuring a regular supply of ration. It will be rolled out in the entire nation taking over from the inefficient present fair price

shops.

These smart stores are quite sustainable as the technology used is quite cheap and easy

to handle.

The idea is to slowly integrate it into the mainstream adding privately owned stores in

the loop for accepting the smart cards thus reducinggovernmentsburden and expense.

They can be easily modified to implement food security bill.

.

HOW?

Increasing number of stores to cater to the

increased beneficiaries. i.e. for 80 crore

people the number of stores will have to be

doubled from what we are using now.

Modifying the smart food card to also

contain the detail of the quota of subsidized

commodities to be distributed

The whole scheme can be implemented in

the targeted fund of 125 thousand crore

allocated by the government.


11/12

Challenges

Can make use of the alreadyexisting FPS .

Centre should share theresponsibilities with stategovernments.

Review the database andamend accordingly on aregular basis.

Take aid of organizations likeUNESCO to confirm thevalidity of data

The identification ofbeneficiaries may not turnout to be as accurate asexpected.

Using a vigilant and powerfulmonitoring system thusenabling strict and timelyactions against suchdeception

There may still remainsome form of corruptionprevailing in the system.

Government may notreadily take the entire

responsibility of the

system and setting up of

new shops.

CONCEPTUAL MITIGATION

Central vigilance committeewill check from time to timeto ensure that proper grainsare transported and all theequipments are fair.

The government can buytheir shop from them at afair market price ascompensation.

FPS owners will protest asgovernment employees willwork instead of having shopowners.

A workshop of 15 days willbe conducted for all theemployees to make themfamiliar with system andensuring properimplementation.

Use of technology may behard to implement in ruralareas.

Quality of grainsdistributed may be

inferior or there may

be tampering with

measurement

instruments.

IMPLEMENTATION MITIGATION


12/12

1. http://www.censusindia.gov.in/2011-common/census_data_2001.html

2. http://planningcommission.nic.in/

3. http://planningcommission.nic.in/reports/genrep/rep_hasim1701.pdf

4. http://www.indiatogether.org/opinions/ps1.htm#sthash.YXJxaGRi.dpuf

5. http://www.indiatogether.org/opinions/ps2.htm#sthash.7UluBGAi.dpuf

6. http://www.fao.org/docrep/x0172e/x0172e01.htm#TopOfPage

7. Economic Survey of India

8. http://planningcommission.nic.in/plans/planrel/fiveyr/11th/11_v2/11th_vol2.pdf

References:
http://www.censusindia.gov.in/2011-common/census_data_2001.htmlhttp://www.censusindia.gov.in/2011-common/census_data_2001.htmlhttp://planningcommission.nic.in/http://planningcommission.nic.in/reports/genrep/rep_hasim1701.pdfhttp://www.indiatogether.org/opinions/ps1.htmhttp://www.indiatogether.org/opinions/ps2.htmhttp://www.fao.org/docrep/x0172e/x0172e01.htmhttp://planningcommission.nic.in/plans/planrel/fiveyr/11th/11_v2/11th_vol2.pdfhttp://planningcommission.nic.in/plans/planrel/fiveyr/11th/11_v2/11th_vol2.pdfhttp://www.fao.org/docrep/x0172e/x0172e01.htmhttp://www.fao.org/docrep/x0172e/x0172e01.htmhttp://www.indiatogether.org/opinions/ps2.htmhttp://www.indiatogether.org/opinions/ps2.htmhttp://www.indiatogether.org/opinions/ps1.htmhttp://www.indiatogether.org/opinions/ps1.htmhttp://planningcommission.nic.in/reports/genrep/rep_hasim1701.pdfhttp://planningcommission.nic.in/http://www.censusindia.gov.in/2011-common/census_data_2001.htmlhttp://www.censusindia.gov.in/2011-common/census_data_2001.htmlhttp://www.censusindia.gov.in/2011-common/census_data_2001.htmlhttp://www.censusindia.gov.in/2011-common/census_data_2001.htmlhttp://www.censusindia.gov.in/2011-common/census_data_2001.html

ppt on public distribution system

Documents

Transcript of ppt on public distribution system