The Union Minister of Consumer Affairs, Food and Public Distribution, Piyush Goyal, has written to Punjab Chief Minister Captain Amarinder Singh urging the latter to implement the e-mode of MSP payment to farmers, i.e, “Implementing the GOI policy towards online payments directly into farmers’ account and compliance with PFMS”.
The letter, Goyal points out, that the Government of India (GOI) has been requesting the State government of Punjab to streamline its procurement and payment procedure in line with the GOI guidelines of direct online payment to farmers and compliance of the Public Finance Management System since 2018.
“The State Government have time and again sought extension of these timelines which have been exempted during KMS 2019-20, RMS 2020-21and KMS 2021 but despite giving sufficient time to comply with the guidelines and series of meetings held, State has not implemented these provisions so far,” Goyal says in his letter.
The Minister also mentions that as early as March 4, 2021, a letter from his ministry has yet again requested the State government to implement online payment directly into farmers’ accounts with effect from the upcoming RMS (Rabi Marketing Season) beginning April this year. Goyal’s intervention comes after the Punjab Chief Minister had opposed direct benefit transfer for farmers in the State and had written to Prime Minister Narendra Modi in March to defer the scheme by, at least, a year.
On March 24, Raveen Thukra, media adviser to the Punjab Chief Minister had tweeted, “Punjab CM @capt_amarinder strongly opposes DBT for farmers, points to age old relationships between farmers & arhtiyas. Writes to PM @narendramodi seeking directions to Ministry of Consumer Affirs, Food and Public Distribution, GOI to defer the scheme by at least one year”.
In the 2020-21 Kharif Marketing Season (KMS) of procurement, Punjab contributed 29.37% (202.82 LMT) of the total paddy procurement of 690.51 LMT. The State is also going to play an integral role in the Central government’s plan to distribute fortified rice under the Mid-Day Meal scheme and the ICDS scheme. The view in the Central government is that despite its consistent efforts to streamline payment of MSP to farmers digitally, in Punjab, as opposed to other States, the arhtiya was given more importance than the welfare of the farmers. An internal note points out that arhtiyas make payment through cash/cheque and keep no record of it as receipts and that form-J maintained by arhtiyas has no mention of the actual receipts of payment by farmers.
The Government of India is keen on ensuring that payment of minimum support price to farmers against procurement is done directly into their accounts so that the farmer benefits and to eliminate middlemen. An MOU has been signed between the State government and the Government of India whereby the State agencies have to ensure the use of EAT (Expenditure Advance Transfer) module of Public Financial Management System (PMFS) while making the payment. The State government’s online payment system has to be integrated with Public Module Management System. State governments are also duty bound to share data relating to procurement operations on the National Procurement Portal for Foodgrains to ensure end-to-end tracking of fund till the last mile beneficiary, that all value chain participants (farmers, arhtiyas, mandis) get their payment directly and not through another value chain participant, i.e arhtiyas.
Incidentally, way back in May 2018, the department of expenditure of the finance ministry had directed all agencies to mandatorily use the EAT module by mid June the same year, stating clearly that if the same is not done, funds will not be released. However, despite repeated reminders from the EAT and the food ministry, Punjab has refused to comply citing resistence of arhtiyas and the provision in the APMC Act for making payments through Arhtiyas.
As Punjab had not complied, from December 18 onwards release for administration and arhtiyas charges to the State were withheld. Yet another letter was sent by the Minister Consumer Affairs, Food and Public Distribution on January 31, 2019 to implement the online payment system from RMS 2018-19. Despite the fact that it was not done, the Central government keeping in mind the exceptional circumstances of Covid-19 directed the FCI to release 90 per cent of the administrative and arhtiya charges amounting to Rs 65.68 crore.
In his letter, the Minister for food, consumer affairs and public distribution drew a parallel between the States Punjab and Haryana regarding the preparedness in both to enforce the online payment directly into farmers’ accounts against the procurement of food grains and noted that Haryana had taken the necessary steps while Punjab had not.
“Recently C&MD, FCI visited Haryana and Punjab to ascertain the preparedness and found that the adjoining Haryana had made full preparation by integrating the land records with the e-procurement portal, but suitable IT infrastructure has not been put in place by the government of Punjab,” Piyush Goyal noted. Arguing that the task at hand was not difficult to achieve, Goyal said that land records in Punjab are available with the revenue department and needed to be integrated with the procurement portal which could easily be done before the ensuing Rabi season or at least verification would be required from revenue officials.
Goyal further said, “It is pertinent to mention that all major procuring States have already implemented these guidelines,” and that some States were even doing bio-metric authentication of farmers at the time of procurement. The States of UP, MP, Bihar, Andhra Pradesh, Telengana, Tamil Nadu are already paying farmers directly through the online payment system.
In his letter, Goyal acknowledges that one of the apprehensions of the Punjab government is about the land which has been given on lease for tilling by absentee landlords may face titleship problem and also offered that the State of Punjab may follow the procedure developed by the neighbouring State of Haryana, where the details of the tenant/sharecropper can be uploaded on the portal with a disclaimer that this would not be a legal document for claiming ownership through tenancy.
“As has been emphasised time and again, it is essential to align existing system so that MSP benefits are passed on directly to farmers,” Goyal underlines.
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