December 8th, 2021
By Rehan Piracha
Experts have called for the revival of ration cards instead of a new Rs120 billion food subsidy scheme targeted at low-income households with less than Rs 50,000 monthly income in the country.
A total of 7.7 million people have registered themselves with the Ehsaas Ration (subsidised ration) Programme scheduled to be launched across the country from January 1, according to Senator Sania Nishtar, Special Assistant of the Prime Minister of Pakistan on Poverty Alleviation and Social Protection.
The subsidised ration programme aims to provide a subsidy of Rs 1,000 a month to each family on the purchase of flour, pulses and ghee/cooking oil from partner merchants across the country.
Around 20 million families identified through the recently completed Ehsaas survey will benefit from the programme. Overall 130 million people, over half of the country’s population, are expected to avail subsidised rations amid the rising inflation in the country.
Rs50,000 income limit
Low-income families with less than Rs 50,000 monthly income can register for the programme. The income level for government employees to avail the ration scheme is set at Rs 31,000 monthly.
The facility will be available on Kiryana stores designated by the National Bank of Pakistan. The federal government will bear 35 percent while a participating provincial government will share 65 percent of the Rs 120 billion ration subsidy for the next six months in the fiscal year.
Sindh, Balochistan opt out
The provincial governments in Punjab, Khyber Pakhtunkhwa, Gilgit Baltistan and Azad Jammu Kashmir have agreed to participate in the programme. But the Sindh and Balochistan governments have not joined the ration subsidy plan.
According to Nishtar, citizens in Balochistan and Sindh will still get a subsidy of Rs 350 (the federal government share) on purchase of ration in case provincial government chose to opt out of the scheme.
Revive ration cards: experts
But experts have called on government to revive the decades-old ration card scheme, pointing out that the new Rs 120 billion subsidised ration programme has no government control over purchase, storage and distribution of essential food items.
According to economist Haris Gazdar, the federal government has consistently downplayed concerns expressed by the opposition parties over rising inflation in the country.
“For the opposition inflation is a serious problem while the government discounts it as a momentary global phenomenon,” Gazdar told Voicepk.net.
Gazdar said the initiation of the Ehsaas Rashan programme seemed to clash with the government logic of inflation of not causing a great impact on people in the society.
“The government has also not come out clearly on next year’s inflationary figures and their impact on segments of society,” he pointed out.
Secondly, the government has opted to provide food subsidy in kind through a new infrastructure of merchant stores instead of sticking with the existing cash distribution through the Benazir Income Support Programme.
According to the economist, food subsidy programmes in the country have worked well when the governments have taken responsibility of purchase, storage and transport of essential foodstuff.
“The mechanism of ration depots had been a very effective programme of subsidised essential food commodities in the country since the colonial times,” Gazdar said.
The government has no role in purchase and distribution of food essentials under Ehsas Rashan Programme, he explained. “The citizens are open to exploitation from merchants,” he pointed out.
Pakistan and Bangladesh scrapped the subsided food programmes based on ration cards. “India in contrast has increased spending on the programme to protect its population from food inflation,” he added.
In his opinion, the federal government should have increased cash distribution under the BISP instead of launching a new food subsidy programme which would be majorly be funded by provinces.
“The Sindh government is not participating due to the federal government government’s lack of clarity over inflation,” Gazdar said.
Karamat Ali, Executive Director of Pakistan Institutute of Labour and Economic Research (PILER), said the government should have revived the time-tested ration cards subsidy scheme.
“The ration card system was an affective food subsidy programme for low-income households,” Ali said.
He said the new food subsidy made no sense at all as it should be universally applicable to all citizens in the country. “The government has also overlooked impact of inflation in other basic necessities like rent and fuel,” he said.