India launches new system for handling welfare

Topics: From the Wires,

NEW DELHI (AP) — India will send billions of dollars in social welfare money directly to its poor under a new program inaugurated Tuesday, aiming to cut out the middlemen blamed for the massive fraud that plagues the system.

Previously officials only handed out cash to the poor after taking a cut — if they didn’t keep all of it for themselves — and were known to enroll fake recipients or register unqualified people. The new program would see welfare money directly deposited into recipients’ bank accounts and require them to prove their identity with biometric data, such as fingerprints or retina scans.

Finance Minister P. Chidambaram has described the venture as “nothing less than magical,” but critics accuse the government of hastily pushing through a complex program in a country where millions don’t have access to electricity or paved roads, let alone neighborhood banks.

The program is loosely based on Brazil’s widely praised Bolsa Familia program, which has helped lift more than 19 million people out of poverty since 2003. It will begin in 20 of the country’s 640 districts Tuesday, affecting more than 200,000 recipients, and will be progressively rolled out in other areas in the coming months, Chidambaram said Monday. The country has 440 million people living below the poverty line.

“In a huge new experiment like this you should expect some glitches. There may be a problem here and there, but these will be overcome by our people,” Chidambaram said.

He appealed for patience with the program, which he called “a game changer for governance.”

The opposition Bharatiya Janata Party has accused the ruling Congress party of using the program to gain political mileage ahead of elections expected in 2014.

As a first step, the government has said it plans to begin directly transferring money it would spend on programs such as scholarships and pensions.

Eventually the transfers are expected to help fix much of the rest of India’s welfare spending, though Chidambaram said the government’s massive food, kerosene and fertilizer distribution networks — which are blamed for much of the corruption and lost money — would be exempt.

The program will eliminate middlemen and transfer cash directly into bank accounts using data from Aadhar, a government project working to give every Indian identification numbers linked to fingerprints and retina scans. Currently hundreds of millions of Indians have no identity documents.

On Monday, 208 activists and scholars published an open letter expressing concern that the government was forcing the poor to enroll in Aadhar to get welfare benefits without putting safeguards in place to protect their privacy. They also expressed fears the government planned to eventually replace the food distribution system for the poor, the largest program of its kind in the world.

“Essential services are not a suitable field of experimentation for a highly centralized and uncertain technology,” they wrote.

Others said the government was trying to do too much too soon.

“A very important concern is are we ready for this sort of thing? The banking infrastructure is very poor, people are far from these banks, when they exist they are overcrowded. Sometimes people have to walk for a day to get to the bank,” says Reetika Khera, a development economist with the New Delhi-based Institute for Economic Growth.

Mihir Shah, a member of India’s Planning Commission accepts that the government’s timeline is “unrealistic,” but said many critics had confused the lack of readiness with flaws in the plan itself.

“My question to them is is it better than what is there today? That is the only way we can judge policy. I don’t think there’s a perfect solution to any of mankind’s problems,” he said.

Shah said a lot more work needed to be done before cash transfers could become a reality across the country. The identification drive needed to reach the vast majority of India’s poor, and villages needed banking infrastructure and Internet connectivity.

“It is going to take time and it will happen only when it happens whatever the deadline. It will be rolled out only when these conditions are in place,” he said. But if the deadline “pushes us to fix the lacunae that currently hamper the roll out of cash transfer, then we’re in the right direction.”

Next Article

Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Comments

0 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>