The government has saved over ₹50,000 crore through direct benefit transfers (DBT) in FY19. This is more than half of the cumulative saving between FY14 and FY18.

Under DBT, benefits or subsidies are transferred directly to the beneficiaries’ accounts, thus cutting wastage and ensuring the effective use of resources for schemes such as the LPG subsidy or wages under the rural employment guarantee programme.

As on date, 439 schemes implemented by 55 ministries and departments use DBT. Official data reveal that the estimated savings from DBT in FY19 were ₹51,664.85 crore, while cumulative savings since the inception of the scheme till FY18 were a little over ₹90,000 crore.

DBT is heavily dependent on JAM — the trio of Jan Dhan Yojana (over 35.75 crore accounts), Aadhaar (over 123.78 crore holders) and mobile connections (116 crore users). The scheme was initiated by the UPA government on a pilot basis on January 1, 2013. The Modi government, in its first term, started using it widely.

The scheme took off in November-December 2014, when all the districts in the country and key schemes were brought under its ambit.

Tech to the fore

Official data also reveal that savings were made possible through the use of information technology, which weeds out duplicate or fake beneficiaries. For example, for subsidy on domestic cooking gas cylinders, 4.23 crore duplicate, fake, non-existent or inactive connections have been eliminated till date. In addition, there are now 1.86 crore non-subsidised LPG consumers, including 1.03 crore ‘Give It Up’ consumers.

Similarly, for the distribution of foodgrains under the public distribution system, 2.98 crore duplicate, fake, non-existent ration cards (including some due to migration, death etc) were eliminated. Under the Rural Employment Guarantee programme, 10 per cent savings on wages on account of the deletion of such beneficiaries is estimated.

The government managed to delete 4.77 lakh such beneficiaries under the National Social Assistance Programme.

The Government has also been able to remove duplicate, fake and non-existent beneficiaries: 5.26 lakh under the scholarship schemes for minorities; 1.91 lakh under scholarship schemes operated by the Social Justice & Empowerment Ministry; and 98.3 lakh under the Supplementary Nutrition Program of Aanganwadi Services.

Now, there is hope that the savings will increase with DBT of the fertiliser subsidy to farmers. The Centre has allocated approximately ₹75,000 crore for the fertiliser subsidy this fiscal. The present system prescribes the transfer of subsidy based on retail sales.

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