Direct Benefits Transfer scheme launches today in 20 districts

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On the eve of the launch of its ambitious Direct Benefits Transfer (DBT) programme, the government Monday announced that the welfare plan will be rolled out in 20 districts and cover seven schemes, mostly scholarships, to benefit more than 2 lakh people.

The programme will expand to another 11 districts on February 1 and 12 more districts will be added on March 1. A total of 43 districts in 16 states have been identified for the first round of DBT that will cover 26 social welfare schemes.

Announcing the launch, Finance Minister P Chidambaram sounded a note of caution saying there may be some teething problems and technical glitches as the flagship scheme takes off. The minister also said that at this stage there was no attempt to shift transfer of food, fertiliser, kerosene or LPG subsidy to the DBT mode as these were complex issues that can only be addressed when the government is fully confident of their amenability to DBT.

"Seven schemes are ready for rollout from tomorrow. I am confident that all beneficiaries in the 20 districts have a bank account. Every effort is being made to ensure that all beneficiary accounts are seeded with the Aadhaar number... credit into account will take place whether the Aadhaar is seeded or not," Chidambaram said.

The minister said that the scheme should get a "fair trial" and a verdict on its failure or success should not be pronounced right away as it is a "huge new experiment" and all efforts are being made to ensure it works. It is a game-changer in terms of governance, payment of money and payment without any human intervention, Chidambaram said.

He also said that the scheme would be formally called Direct Benefits Transfer and not Direct Cash Transfer as there were certain schemes which were not necessarily backed by cash. The slogan "Aapka paisa, Aapke haath", however, will stay as it conveys the meaning effectively.

The minister pointed out that cash withdrawal arrangements are being strengthened and beneficiaries will be able to withdraw from their own bank branches/ATMs or through business correspondents. Banks are also accelerating the pace having invited a tender to set up more than 20 lakh interoperable micro ATMs to facilitate cash withdrawal and ensuring beneficiaries have a bank account.

Chidambaram said the government will look at other schemes and subsidies that can shift to DBT mode in 2013 but will do so carefully and keeping in mind the capability of the system to cope with more schemes.

Meanwhile, the BJP criticised the announcement saying the move is another attempt to divert public attention from issues such as price rise, corruption and declining economic growth rate, among others.

"The government is trying to create confusion in the mind of common public as if it is going to be a salvation for the poor. But actually it is fooling the poor of the country," BJP spokesperson Shahnawaz Hussain said.

The party cautioned the government against what it said was the "hurry" in rolling out the programme without addressing key issues.

"It is less about criticising the scheme...it's about the manner of implementation where many issues need to be addressed first. First, there is no single viewpoint on the poverty line within the government. Secondly, the government says cash subsidy will be given to BPL families but most such families do not have a bank account. It is only now that bank managers have been asked to help them open accounts. Aadhaar card coverage is far from the desired level. The government is not addressing the basic issues it should have addressed first," Hussain said.

"Today, the Congress is not even in the game but is calling this scheme a game-changer after spoiling the game of the country," he added.

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