-----Improving reach and efficiency of the

Public Distribution System

SHINNING INDIA ACTUAL INDIA

INDIA RANK’S 2nd IN WORLD IN TERMS OF FARM OUTPUT .

ANTI-POVERTY PROGRAM HAS INCREASED BY 25 TIMES SINCE ECONOMIC REFORM(RS 7500 Cr. IN 1992-93 TO 2 LAKHS Cr. IN CURRENT BUDGET)

INDIA HAS LARGEST CHILD DEVELOPMENT PROGRAM(ICDS)

PRODUCTIVITY IN 2012-13 TO RISE BY 0.6% TO 276.6 MILLION TONS

INDIA SHARES 11% OF THE TOTAL WORLD’S PRODUCTION

8 INDIAN STATES HAVE MORE POOR PEOPLE AS COMPARED TO 26 POOREST AFRICAN NATIONS.

OUR RANKING IN HUMAN DEVELOPMENT INDEX CONTINUES TO HOVER AROUND 135

42% CHILDREN (<5YRS.) ARE UNDERWEIGHT

INDIA LOSES 45Cr. ANNUALLY DUE TO FOOD-GRAIN WASTAGE

PER CAPITA FOOD-GRAIN AVAILABILITY IS MERELY 443.5gm

An Unspoken Boundary………

SOME FACTS & FIGURE…..

40% FOOD-GRAIN DO NOT REACH PEOPLE

INDIA LOOSES 150Cr. MONTHLY IN FOOD-

GRAIN DISTRIBUTION

Total monetary value of petty corruption in Public Distribution System (PDS) in the

country is estimated to be Rs. 358 crores per annum.

According to the World Bank, 32.7 percent of Indians live below the international poverty line of 1.25 dollars per day while another 68.7 percent live on less than two dollars per day.

India is home to 25 percent of the World’s Total Hunger.

Deserving people

10%

Non- Poor (non

deserving)19%

Illegal diversions

43%

Administrative Expenses

28%

Subsidy distribution

Loopholes in our Public Distribution System……….

Faulty “ BPL “ identification criteria13 indicators : obsolete , non-

transparent ,non-verifiable……

Numerous schemes, prices , stock registers

Complexity of administration

, inspection, audit mechanism….

Several price categories within the same distribution network and commodities

leakage and malpractice among

traders and officials…

Delayed dispatch of food grains, compromise on quantity

Black-marketing and hoarding…

Improper storage , transportation facilities

Food-grain quality deteriorates….

FCI spends Rs.242 crore while trying to prevent any loss of food

grains during storage. Ironically another 2.59 crore was spend to

dispose off the rotten food grains.In 2010-11, the foodgrain loss was 1.56 lakh tonne, while it was

1.31 lakh tonnes in 2009-10 and 0.58 lakh tonnes in 2008-09

Large storage gap between state & district warehouse.

Lac k of credit and buffer stock policies.

At this level a total distribution loss of 58.4Crores is incured by the

Goverenment.

out of the 1.13 lakh tonnes of PDS rice which the State receives

every month, about 45,000 tonnes go to black marketeers.

Large amount of bribes are paid by FPS owners for intake of

ration(food-grains).

Low profit margin of nearly 70paise per kg of food-grain supplied.

Large number of bogus(ghost) card are used for intake.

Problems faced by consumers are numerous,some of them

Are:

Issue of new ration card; Surrender ration card/change of

address on ration card; Deletion & addition of family members

in ration card; Permission for release of extra quantity during

festivals/months.

LEAKAGE AT EVERY STEP……

BAND-AID TO THE LOOPHOLES…..

For identification of Beneficiaries /Card allocation :-A 3-tier system must be developed to ensure efficiency, transparency, and forecasting

to its optimum level.

IMPLEMENTATION OF 3-TIER SYSTEM…..

STAGE -1(TALUKA

LEVEL)Small groups of comprising of

women’s self-help

groups,panchayats&co-

operative society etc. to visit a

specified area to identify and

register the people intended for

the benefit (BPL)

Process need to repeated twice

or thrice to ensure error in

exclusion(those who are actually

but not issued ration card)&

inclusion(those who are non-poor

but are issued ration card)

The final report to be forwarded

to district level(stage 2)

STAGE-2(DISTRICT

LEVEL)At this stage the data collected at

Taluka level needs to be

computerised (CENTRAL DATA

MANAGEMENT SYSTEM)

Distribution of bar-coded

cards at every village/taluka.

A vigilance team appointed by

D.M. to randomly visit some taluka

and cross verify the data,if any

error found the process of

STAGE-1 must be repeated.

Annual Ranking of the FPS

to be done according to public

survey.

STAGE-3(STATE LEVEL)

At this stage the proper forecasting

of the subsidies required(food

grains, kerosene, etc.) in that

QUATERLY PERIOD must be done

in accordance with the data provided by

various district.

Accountability for any error in BPL

families identification and card allocation

must be set.

Redressal of grievances must be

done to ensure ZERO ERROR in the

system.

Allotment of special benefits and

prizes to FPS holding top ranks in

Annual ranking provided by district.

IT STATERGIES INVOLVED IN STOCK

MANAGEMENT..........

Central Data Management system (CDMS)-All the data allocation is done by the computer it can keep track of all the data and the whole process of

data maintenance is taken care of by the PC and hence no chance of mistakes and virtually no manual work. Further any checking person can simple enter in and see the availability of the stock and other things by just giving a few clicks in the computer. Hence the whole process is completely error free and has a lot of advantages. Setting up of a main server state-wise must be done to ensure transparency in data management.

Bar-Coded Card (BCC)-All sales at FPS outlets to consumers are recorded using Point-of-Sale (POS) Terminals. Cards brought by

the consumers are scanned using a barcode scanner attached to the POS terminal. The POS automatically identifies the consumer and sales to the consumer are recorded by the terminal. The terminal has an intelligent application that not only records the date, time, rate and quantity of grains sold against the coupon, it also “speaks out” the quantity and total cost of the commodities so that the consumer can know what transaction has been done by the FPS outlet. This would to improve service delivery by empowering beneficiaries, minimizing irregularities and increasing transparency in the system.

D-GPS based Fleet Tracking for Transportation-All trucks transporting grain from FCI to SFC godowns are to be fitted with GPS+GPRS devices which

transmit their physical location information in real-time mode. Route charts for these trucks can be planned in advance including their source, via points, stoppage points, speed limits and destination. If a truck diverts from its route in the course of grain movement, SMS based alerts are automatically sent to concerned officials. The same happens if the truck over-speeds or stops at undesignated stoppages for some time. Alerts are also generated and received when the truck leaves the source or arrives at the destination. All trucks can be tracked online on maps.

ORGANIZATIONAL STRUCTURE ( FOR A STATE)

Vigilance Team:-

•Consist of 5 squads

•Each squad with 5-6 members

IT Cell :-

Comprising of 10-12 technicians

and 1 Presiding officer

Women's help group operating

in village area.

In small group of 10-15 peoples

Co-operative society operating in

urban areas including slums.

In small groups of 10-15 people.

Network of NGO’s and trained

volunteer for remote areas.

In large groups of 20-25 people

T

A

L

U

K

A

D

I

S

T

R

I

C

T

IT Cell:- (CDMS)•50 technicians

•2 presiding officer

Customer

complaint cellS

T

A

T

EStock Management cell:-• 1 Presiding officer per warehouse

• 15 officials per warehouse

State vigilance

team

CHIEF CONTROLLER

FUND MANAGEMENT (Yearly cost 12 Cr. + One time cost 4 Cr.)

FINANCIAL DIRECTOR

8 lakh P.A.

Fund management team

30 lakh P.A.(1chief &10

technicians)

Vigilance team

72 lakh P.A.(30

employees)

IT cell

32 lakh P.A.(1 chief

& 15 technicians

Vigilance team

30 x 2.4 lakh P.A.

District level management

30 lakh P.A.

IT cell

1.2 Cr. P.A.(50

technicians)

Survey

4Cr. P.A.(7000 x 6000)

Miscellaneous

25 lakh P.A.

District warehouse

management

22lakh/p.a.(12 employees)

Stock Management

Approx. Cost of 4Cr.

Inc. transportation

Customer care

cell

(Privatized)

One time cost :-GPS installation-1Cr. IT Hardware/ Software-50 lakhs

Card allocation-20 lakhs Logistic cost-30 lakhs

AN IDEA THAT IS DEVELOPED AND PUT INTO ACTION IS MORE IMPORTANT THAN AN IDEA THAT EXISTS ONLY AS AN IDEA

IMPACT AND REACH........

Correct identification of beneficiaries through self-help groups, co-operative society

& network of volunteers.

Security features of the computer network can assure security, integrity &

accountability.

Right Ration to Right person on Right time.

More accurate, temper-proof smart cards avoid any kind of manipulation. If any, can

be easily trace out.

Due to online availability of stock information, wastage/losses /black-marketing can

be easily analysed and controlled.

ULTIMATELY CUSTOMER SATISFACTION IS REACHED...........

ADVANTAGES OVER PRESENT SYSTEMThe CENTRAL DATA MANAGEMENT SYSTEM stores all information of procurement of

commodities , date and time of procurement

Restricts over-procurement by the dealers and consumers

Discards necessity of tedious record maintenance

Just read the card and it’s done.

NO possibility of manipulation of records

Diversion of the subsidies can be brought down from merely 60% to 6%

Identification of the beneficiaries‘ to it’s optimum level.(Elimination of the bogus(ghost) card)

Leakage at various steps in PUBLIC DISTRIBUTION SYSTEM can be eliminated to a broad

level.

Transparency in the above suggested Public Distribution System is much better than the existing

system of Public Distribution System .

Potential for fully electronic transfer increases incentive for competitive prices and assures quality

of food-grain among Public Distribution System (PDS) store.

GPS based FLEET TRACKING ensures ZERO leakage at the time of transportation of subsidy

througout the process.

CHALLANGES AND RISK

CONCEPT CHALLANGES

Government do not see the viability of funding this

PUBLIC DISTRIBUTION SYSTEM.

High RURAL URBAN biased population.

Uncertainty in food-grain production(under/over) due to

various climatic factors.

PROPER STORAGE/SECURITY of FOOD-GRAIN

in GODOWNS at various level (State, district and FPS)

from climatic factors and insects.

CORRECT implementation of IT strategies at lower

level.(SLOW/SHUTDOWN of SERVER)

QUALITY of FOOD-GRAIN delivered to the

beneficiaries.

IMPLEMENTATION RISKS

Advertising/ Awareness

Campaign.

Tie-ups with CALL CENTRE

for complaint and customer care

cell.

Tie-ups with GPS

manufacturing company for

installation and maintainence.

Bringing in leaders/ NGOs for

training inputs .

Proper & single boundary line

must be defined for the BPL

MITIGATION AND CHALLANGES

REFERENCES:-

TRANSPARENCY INTERNATIONAL -INDIA CENTRE FOR MEDIA STUDY AND SURVEY REPORT

2008-10

CMS CORRUPTION REPORT

ECONOMIC TIMES DATASOURCE

WORLD BANK DATA

OXFORD POVERTY AND HUMAN DEVELOPMENT INITATIVE (OPHI)

ECONOMIC SURVEY

ASIAN BANK DEVELOPMENT STUDIES 2012

REPORT OF CAG ON STORAGE MANAGEMENT AND MOVEMENT OF FOOD-GRAIN IN FCI

UPSC PORTAL(E-MAGZINE)-PUBLIC DISTRIBUTION SYTEM

CENSUS OF INDIA

U.N.HUMAN DEVELOPMENT INDEX

WADHWA COMMITTEE REPORT ON PUBLIC DISTRIBUTION SYSTEM IN INDIA