Government to demand return of subsidy at the first hint of richness

20, Jul 2018 By Mukesh Kamath

Poor people are targets of the Direct benefit transfer(DBT) scheme. Government has stated its intent to reduce the subsidy burden in the economic survey 2018. Hence it is mulling all options like demanding the subsidy back in case of wrong targeting. Wrong targeting means giving benefits to an ineligible person, meaning a rich person. Government seems to be on the prowl looking for hints of excessive income which can help it curtail the subsidy.

This poor farmer might have to lose upon his subsidy
This poor farmer might have to lose upon his subsidy

The question of inclusion and exclusion errors in the beneficiary lists of various government schemes is a perennial problem. Such Errors were expected to reduce after Aadhaar linking of benefits. This clearly hasn’t worked. Middle class enjoying the LPG subsidy all this while could be in for a shock. Wrongful exclusion is a real concern.

Untold suffering of the aspirational class

Mr. Sharma who lives in sub-urban Delhi, had recently booked a foreign tour for his family. He was aghast to find that the gas subsidy which government used to deposit in his account was stopped abruptly. A couple living in Mumbai with family income well below the 10lakh rupee cutoff was at their wits end. They found their gas subsidy stopped when they went for a purchase of jewelry which involved submitting their aadhaar number. This is not all, a railway ticket subsidy was denied to Mr. Bhakta here in Indore. He was unsure why claim 100% subsidy drop down in the IRCTC website was not working last week. During the travel it was the Ticket Collector who revealed to Mr. Bhakta that anyone with high income does not get to claim the benefits.

While middle class households might not feel the pinch of benefit stoppages, the government has thought of demanding the benefits back from people found in-eligible. “This is outrageous” says a retired banker and pensioner Mr. Naik. How can government ask back the subsidy, “why can’t they disallow the claims initially itself” he says.

Our news bureau correspondent feels this might be a problem when people might claim to have gained wealth recently and contend that the governments demand of returning benefits is untenable. The benefits are linked to the aadhaar number of an individual which in turn is linked to the bio-metrics. Hence, It is difficult to trick the government using the mistaken identity ruse too.