People's Democracy

Oppose Cash Transfers as substitutes for Public goods

The Polit Bureau of the Communist Party of India (Marxist) issued the following statement on November 28, 2012.

THE direct cash transfer scheme described by the Congress as a “game changer” is indeed a game changer whose rules are weighted against the poor, in favour of the UPA-2 Government’s obsessive commitment to cut subsidies to the working people. The Government has declared that this policy will, once the “system is in place” be extended to food and fertiliser. In a period of high inflation, cash transfers to replace public goods such as these is to actually cut subsidies since the cash to be transferred will not cover the increased costs of the same amount of subsidized foodgrains. This will have an adverse impact on increasing malnutrition and hunger. The CPI(M) strongly opposes such a policy shift away from provision of foodgrains, kerosene, fertilizers etc instead of providing for a universal PDS at controlled prices.

The CPI(M) also objects to linking MNREGA wages to the AADHAR card. As has been repeatedly pointed out by experts, biometric identification for manual workers has a high twenty per cent margin of error as fingerprints of such workers change. It is a similar problem for senior citizens. Without any discussion in Parliament on the proposed Bill for UID to push through such changes, which will have far reaching implications for manual workers is unacceptable.

As far as scholarships, pensions etc are concerned, most of these schemes are already cash transfer schemes through bank accounts and are fiscal neutral. The amounts and also the coverage should be increased and linked to the price index.