How a Flawed National Food Security Act is Undermining Kerala’s PDS Lifeline

Many of the existing benefits and beneficiaries have failed to find protection under the Act, which is limited only to the distribution aspects, ignoring several vital elements such as agriculture, climate change and farmer’s rights.

Credit: Reuters/Amit Dave

Cutbacks in food grain allocation is set to adversely impact the state. Credit: Reuters/Amit Dave

Succumbing to the ultimatum given by the central government, Kerala and Tamil Nadu, two states hailed for their remarkable strides in bolstering the Public Distribution System (PDS), implemented the National Food Security Act (NFSA) on November 1, 2016. Failing implementation, these states were ordered to purchase their monthly targeted PDS (TPDS) allocation of rice and wheat for the above poverty line (APL) population at the minimum support price rates of Rs 22.54 and Rs 15.25 respectively, whereas the corresponding central issue prices remained Rs 8.30 and Rs 6.10.

The state of Kerala is now gearing towards a mass agitation on February 18. Its numerous appeals to the Centre to safeguard the state’s pre-NFSA allotment of food grains were all in vain and the ruling CPI(M)-led Left Democratic Front has called for a state-wide agitation against the Centre’s policies destroying the statutory rationing system in the state.

The marked reduction in the allocation of food grains is the major cause of worry for the state. While the average annual targeted PDS allotment for Kerala in 2010-13 was around 16.01 lakh metric tonnes, under NFSA, the state is entitled to an annual food grain allocation of 14.25 lakh metric tonnes only.

This is inclusive of the tide over allocation of around 3.99 lakh metric tonnes of food grains per year that the state gets on account of its annual NFSA allocation being less than its average annual off takes for the preceding three years under normal TPDS. Key officials with the state Civil Supplies Department allude to the fact that around 10.13 lakh metric tonnes will be required for consumption by the NFSA households alone, leaving a mere 4.12 lakh metric tonnes for distribution amongst the remaining households. In contrast, an average of 7.74 lakh metric tonnes of food grains was allocated for the APL households in 2010-13.

This cutback in food grain allocation is set to adversely impact the state, which has until recently seen a remarkable off take of PDS food grains, both under normal and additional TPDS. According to the latest Food Grain Bulletin released by the Department of Food and Public Distribution, except for 2016-17, Kerala’s off take of food grains from 2013-14 has been in the range of 97-99.6%. Even the off take of additional TPDS allocation in the state in recent years has recorded a striking 100%. In fact, until the chaos following the implementation of NFSA in November, the off take of food grains in the state remained very high.

Unfortunately for the state, the statutory recognition accorded to ‘targeted’ PDS under NFSA has resulted in a large chunk of its existing PDS beneficiaries being left out from the purview of the Act. Although the central government determined NFSA coverage for Kerala – 1,54,80,040 persons – is much more than the total number of Below Poverty Line (BPL) and Antyodaya Anna Yojana (AAY) beneficiaries in the state – 96,03,601 persons (in June 2016) – implementing NFSA would have implications for those left out from the targeted coverage. In the past few months, identification of the eligible households has seen much resentment among the public, with 14 lakh complaints being filed, signifying the shortfalls that beset targeting.

As a matter of fact, until now, Kerala has secured a near universal coverage of PDS, along with ensuring a superior physical and economic access to PDS. This is despite the restriction on the BPL coverage under TPDS in the state in 1997 to 25% of the total population.

However, around 66% of the APL households were recognised as state subsidy households – APL (SS) – entitling them to food subsidies from the state government. On an average, these households received around 10 kg of food grains every month. Only those households having more than 2.5 acres of landed property or a house of more than 2500 sq ft or those earning a monthly income of more than Rs 25,000 per month were left out from the state subsidy category. Considering the state government’s 2011 BPL survey finding that 42.4% of the total households were below the poverty line, this expansion in the PDS coverage is of much significance for the people in the state.

Equally important is the state’s initiative in reducing the issue prices of essential commodities to its beneficiaries. From April 2016, BPL and AAY households in the state were provided rice free of cost. In fact, from 2011, these households were paying just Re 1 per kg for PDS rice. Besides, APL (SS) households got subsidised rice at Rs 2 per kg and the remaining APL households were also provided with subsidised food grains. Wheat provided to the BPL households was also further subsidised by the state government.

Without a doubt, such a robust PDS has been a lifeline for the people of Kerala, amply reflected in the high rate of PDS purchase of food grains in the state. In the National Sample Survey Organisation’s (NSSO) 68th round survey on PDS and Other Sources of Household Consumption of 2011-12, Kerala was found to be one of the three states with the highest incidence of PDS purchase of rice in the country. With the implementation of NFSA, the onus of protecting the existing benefits seems to be lying entirely on the political will of the state government, a tough decision given the heavy burden on its already strained coffers.

Nevertheless, when left with the option of either giving in to the constraints set by the legislation or choosing to stand with its people, the state government boldly chose the latter. On November 2, the very next day of officially implementing NFSA, the state cabinet decided to provide free food grains under PDS to AAY and priority households, even when the central issue prices under NFSA remains at Rs 3 and Rs 2 for one kilogram of rice and wheat respectively. It is laudable that despite having an option to reduce the benefits, the state decided to extend them to a larger population. Thus, an additional 58 lakh people now covered under NFSA can take home free ration every month.

In addition, the state also decided to expand PDS benefits to those outside the targeted NFSA population. Subject to the final list, around 1.2 crore people belonging to non-priority households will get two kilogram rice every month at Rs 2 per kg from the tide over allocation of the state, currently issued to the states at existing APL central issue prices. The remaining non-priority households are to be given two kilogram atta and rice subject to availability.

The state government’s decisive move to continue its supply of free ration, that too for a larger section of population, and also extend the PDS coverage beyond the NFSA mandate, is expected to escalate Kerala’s food subsidy costs. According to the information provided by the state food and civil supplies minister, P. Thilothaman, in the state legislative assembly, Kerala will have to bear an additional expenditure of Rs 306.64 crore, thereby escalating its annual expenditure on ration distribution to Rs 1126.39 crore from the current expenditure of Rs 819.75 crore.

However, despite these measures, a considerable number of old APL households who were receiving around 8-10 kg of rice and two kilogram of wheat every month are still expected to bear the brunt of NFSA implementation. It is also likely that there would be a reduction in the entitlement of those priority households, who were previously BPL households. Normal household size in Kerala being 4.2 (according to the 2011 Census), there would be the reduction of around 10-12 kg in the food grains that they receive post-NFSA.

One might be wondering why a state with an exemplary track record in health and education still needs PDS. Being a chronically food deficit state makes it imperative for Kerala to maintain a strong PDS. Over the years, food production in the state has dwindled, and in 2012, only 15% of the total food grain requirement was produced in the state.

Viability of farming has diminished immensely owing to various reasons, including the increase in cost of cultivation, instability in farm prices, increased intensity and frequency of moisture stress, low irrigation status, marginalisation of holdings, low levels of mechanisation and increase in wages. According to the Situation Assessment Survey of Agricultural Households conducted by the NSSO in 2013, a massive 77.7% of the agricultural households in Kerala were reported to be indebted as against the national average of 52%.

While revitalising agriculture is paramount for the state, it cannot afford any compromises with its PDS. NFSA does not curb states from continuing or formulating food or nutrition based plans or schemes. However, these higher benefits are to be financed from the state’s own resources, effectively leaving the issue of food security of those falling outside the NFSA mandate to the state governments.

The intention behind highlighting the adverse impacts of NFSA is not to underplay the significance of the legislation in promoting food security. Yet, one cannot lose sight of the fact that in its present form, the Act is a much-diluted version of what the civil society organisations and many political parties had demanded. Many of the existing benefits and beneficiaries have failed to find protection under the Act and it limits itself to distribution aspects alone, completely ignoring many vital elements such as agriculture, climate change, farmer’s rights etc.

Even the definition of ‘food security’ under the Act is a highly constrained one, limited to a mere supply of the entitled quantity of food grains and meal specified under Chapter II of the Act. Apart from this, it is also feared that certain ‘reforms on targeted PDS’, such as the introduction of cash transfer and leveraging of Aadhaar – notably the ones that are vehemently pushed by the central government – will sound the death knell to the stated objectives of the Act.

What has resulted in Kerala after a protracted struggle is a legislation which despite its welfare tenor, arguably gives ample scope for furthering the neoliberal agenda that can endanger food security for many in the future.

This article draws from the findings of an ongoing study by Centre for Child and the Law, National Law School of India University, Bangalore to map the rulemaking process under NFSA, of which the author is a part.

Neenu Suresh works as a Research Associate with the Centre for Child and the Law, National Law School of India University, Bangalore.

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