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Expenditure panel submits report on food subsidies

Our Bureau

NEW DELHI, July 10

THE Expenditure Reforms Commission (ERC), chaired by former Finance Secretary, Mr. K. P. Geethakrishnan, today submitted its first report to the Government, dealing exclusively with the issue of revamping the existing structure of food subsidies. The rep ort was submitted to the Finance Minister, Mr. Yashwant Sinha.

Talking to newspersons after submitting the report, Mr. Geethakrishnan declined to divulge the report's contents, even while he said that the Commission has limited itself to looking at the food subsidy issue from the angle of the mandate given to it by the Government and not with a view to suggesting increase or decrease in its quantum. The mandate, he added, pertained only to making the subsidy regime more transparent and maximising its benefits to the targeted population.

``The report does not deal with budget numbers. We are an expenditure reforms commission and not an expenditure reduction or increase commission,'' Mr. Geethakrishnan said.

He said that the Commission would want a wide debate on its report, which would be put on the Internet after the Government processes its various suggestions. The Government has already spelt out its intention of limiting food subsidy only to the country 's population below poverty line (BPL). The above poverty line (APL) segment would not be given any subsidy although the Food Corporation of India (FCI) would continue to meet their existing grain entitlements at its full economic cost.

Following the measures taken in the 2000-01 Union Budget to double foodgrain allocations to the BPL and abolish consumer subsidy to the APL segment, the outgo on food subsidy is slated to fall to Rs. 8,100 crores this fiscal, as against Rs. 9,200 crores in 1999-2000 (revised estimates).

Mr. Geethakrishnan said that the next report of the Commission, which is expected to be submitted to the Government within three weeks, would deal with the issue of fertiliser subsidies and the restructuring of four to five Government ministries and depa rtment.

``We are looking into the structure of about 15 Government ministries and department. We are having thorough discussions with the ministries to understand the entire issue,'' Mr. Geethakrishnan said.

The Government had constituted ERC on February 29, this year, to suggest ways at downsizing the Government in a systematic manner. Though the Commission is required to submit its final report within one year, it was later directed to send in its recommen dations to the Government on a quarterly basis.

Pic.: Mr. K.P. Geethakrishnan, Chairman, Expenditure Reforms Commission, presenting the first report of the commission to the Finance Minister, Mr. Yashwant Sinha, at his office in the Capital on Monday.