Food security cost: Between Rs 95,000 crore and Rs 200,000 crore!

Bhavdeep Kang explains the contours of the National Food Security Bill, which will be discussed by the Union Cabinet on Tuesday.

The Cabinet note on the National Food Security Bill, to be taken up by the Union Cabinet in its meeting on Tuesday, envisages an expenditure of Rs 95,000 crore for implementing the framework legislation on food security.

However, food policy analysts say this is a gross understatement and the cost is likely to be in the region of Rs 200,000 crore. A further Rs 110,000 crore has been sought for increasing food production by 25 million tonnes per annum. If and when the bill becomes a reality, it will be historic.

According to the note, which closely follows the draft bill prepared by the National Advisory Council, 75 per cent of the rural and 50 per cent of the urban population are to be brought under the food security umbrella.

Interestingly, the food allocation will be per person rather than per household, with each person in the 'priority' segment (46 per cent of the rural and 28 per cent of the urban population) getting 7 kg of food grains per month. Non-priority households will get 3 kg.

The issue price proposed is lower than it is currently, at Rs 2 per kg for wheat, Rs 3 per kg for rice and Re 1 per kg for coarse grains.

General category households will have to pay half the minimum support price.

Special entitlements are proposed for children under 14 and pregnant and lactating women. The latter will get Rs 1,000 per month for six months. In case of short supply of foodgrains, the central government will provide a food security allowance, to be disbursed through state governments.

As the NAC draft suggested, the eldest woman over 18 years of age in each family will be regarded as head of the households and the ration card will be in her name.

The grievance redressal mechanism will be three-tiered, as proposed in the draft bill.

In delivery of foodgrains, a significant role for local bodies like panchayats is envisaged.

The Cabinet note points out that annual requirement of foodgrains to ensure food security will be 60.74 million tonnes. The outlay will be Rs 27,663 crore more than is currently being spent on the Public Distribution System.

Besides, the ministry of women and child development has asked for Rs 35,000 crore for the ICDS programme which is part of the food security schemes.

Rs 8,920 crore is the estimated amount required for feeding destitute, homeless and disaster-affected persons.

Rs 13,500 crore will be spent on pregnant and lactating women. Administrative expenses will cross Rs 1,000 crore.

The cost of handling and transportation of food grains would work out to Rs 8,300 crore per annum.