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LATEST NEWS UPDATES | The significance of local power structures in Bihar’s coupon-based PDS -Chetan Choithani & Bill Pritchard

The significance of local power structures in Bihar’s coupon-based PDS -Chetan Choithani & Bill Pritchard

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published Published on Aug 18, 2015   modified Modified on Aug 18, 2015
-Ideas for India

In 2007, Bihar introduced the coupon system in PDS to curb leakages at fair price shops. This column argues that even though the administrative logic of the coupon system is fundamentally sound, such reform can be effective only when accompanied by institutional transformations that broker change in the existing local politics of inclusion and exclusion. 

The performance of Bihar’s public distribution system (PDS) remains a topic of considerable national interest. For decades, it has been notorious for extreme levels of maladministration and outright theft. Although different researchers vary in their estimates of the extent of leakage from Bihar’s PDS, there is no doubt about the fact that the state substantially lags the nation when it comes to the operational credibility of this vitally important social safety net1.  

In this context, the government has been attempting to reform the state’s PDS. A central plank of these efforts was the 2007 initiative to use coupons to administer the PDS in order to curb the leakages at the beneficiary-fair price shop (FPS) interface. The coupon system is designed to work as follows: every beneficiary household with Antyodaya1 and Below Poverty Line (BPL) card is provided with 12 coupons annually for each of the PDS commodities that include wheat, rice and kerosene; households with Above Poverty Line (APL) are only eligible for kerosene and thus are provided with 12 kerosene coupons. These monthly coupons specify their entitlements and the price they have to pay for each commodity. The monthly PDS entitlements of recipient households include 35 kilograms and 25 kilograms of food grains (wheat and rice) for Antyodaya and BPL households respectively, and a universal entitlement of 2.75 litres of kerosene for all cardholding households. Coupons are distributed through village camps, organised by the local gram panchayat under the surveillance of officials from the block development office (the process of coupon distribution is video-recorded). Every month, beneficiary households redeem three coupons, one against each of the specified PDS commodities, at a local FPS. In principle, beneficiaries can choose the FPS they use). Then, the FPS owner forwards the coupons to the block/district level authorities in order to get next month’s supplies.

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Ideas for India, 17 August, 2015, http://www.ideasforindia.in/article.aspx?article_id=1490


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