CAG report on National Food Security Act (NFSA), 2013

• The Comptroller and Auditor General of India (CAG) submitted a report on the ‘Preparedness for Implementation of the National Food Security Act (NFSA), 2013’
• The objectives of conducting the audit were to assess whether states and union territories (UTs) had: (i) identified eligible households and issued ration cards to the beneficiaries, (ii) developed an adequate infrastructure to implement the Act, (iii) initiated reforms with regard to the existing Targeted Public Distribution Scheme (TPDS), and (iv) put in place an effective grievance redressal system and monitoring mechanism.

Key findings of the audit report include:

• Identification of eligible beneficiaries: It was observed that since the NFSA was enacted in 2013, 18 states/UTs had implemented it as of March 2015. Only 51% of the eligible beneficiaries in the country had been identified. The NFSA states that respective states have to notify guidelines for identifying priority households under NFSA. However, CAG found that barring Chhattisgarh, Delhi and Jharkhand, states had simply re-stamped old ration cards (under TPDS) as being NFSA compliant without carrying out a fresh process of identification. Most states had also failed to adhere to provision of the Act which mandates having the ration cards in the name of women in the household who are above 18 years of age.
• Implementation of NFSA: The NFSA had provided a deadline of one year for states to complete its implementation. Only 11 states completed the identification of beneficiaries within this deadline. The Ministry extended this timeline three times, the last being in September 2015. Subsequently, 7 more states identified beneficiaries by October 2015.
• Infrastructure and logistics: The states/UTs were reported to have inadequate infrastructure to handle the logistics of storage and movement of food grains under NFSA. The CAG noted that 95% of the food grains in the country are transported by railways. After implementing NFSA, the quantity of food grains transported between states would be expected to increase, indicating a higher requirement of rakes (group of freight wagons) for the transportation of food grains. The CAG stated that 20% more rakes would be required for this purpose. However, it was observed that the availability of rakes had been falling short of their requirement (shortfall of 13% to 18%) from 2010-11 to 2014-15.With regard to storage capacity, it was found that the available capacity in states was inadequate for the allocated quantity of food grains. As of October 2015, of the 233 godowns sanctioned for construction in Maharashtra, only 93 had been completed. In Assam, although the storage capacity was enough for the state’s allocation, the conditions of the godown were found to be too damp for storage. Some of the storage in Jharkhand was also found to be unfit, either because of its remote location or the damaged condition of the godowns.
• Doorstep delivery of food grains: It was observed that doorstep delivery was only happening in Bihar and Delhi. In Maharashtra, doorstep delivery of food grains was done only in tribal and drought prone areas of the state, while in Uttar Pradesh, doorstep delivery was being done in a few districts (15 out of 75) by hiring contractors.

About NFSM, 2013:

• Coverage and entitlement under Targeted Public Distribution System (TPDS) : Upto 75% of the rural population and 50% of the urban population will be covered under TPDS, with uniform entitlement of 5 kg per person per month. However, since Antyodaya Anna Yojana (AAY) households constitute poorest of the poor, and are presently entitled to 35 kg per household per month, entitlement of existing AAY households will be protected at 35 kg per household per month.
• State-wise coverage : Corresponding to the all India coverage of 75% and 50% in the rural and urban areas, State-wise coverage will be determined by the Central Government. Planning Commission has determined the State-wise coverage by using the NSS Household Consumption Survey data for 2011-12.
• Subsidised prices under TPDS and their revision : Foodgrains under TPDS will be made available at subsidised prices of Rs. 3/2/1 per kg for rice, wheat and coarse grains for a period of three years from the date of commencement of the Act. Thereafter prices will be suitably linked to Minimum Support Price (MSP).  In case, any State’s allocation under the Act is lower than their current allocation, it will be protected upto the level of average offtake under normal TPDS during last three years, at prices to be determined by the Central Government. Existing prices for APL households i.e. Rs. 6.10 per kg for wheat and Rs 8.30 per kg for rice has been determined as issue prices for the additional allocation to protect the average offtake during last three years.
• Identification of Households : Within the coverage under TPDS determined for each State, the work of identification of eligible households is to be done by States/UTs.
• Nutritional Support to women and children : Pregnant women and lactating mothers and children in the age group of 6 months to 14 years will be entitled to meals as per prescribed nutritional norms under Integrated Child Development Services (ICDS) and Mid-Day Meal (MDM) schemes. Higher nutritional norms have been prescribed for malnourished children upto 6 years of age.
• Maternity Benefit : Pregnant women and lactating mothers will also be entitled to receive maternity benefit of not less than Rs. 6,000.
• Women Empowerment : Eldest woman of the household of age 18 years or above to be the head of the household for the purpose of issuing of ration cards.
• Grievance Redressal Mechanism : Grievance redressal mechanism at the District and State levels. States will have the flexibility to use the existing machinery or set up separate mechanism.
• Cost of intra-State transportation & handling of food grains and FPS Dealers' margin : Central Government will provide assistance to States in meeting the expenditure incurred by them on transportation of food grains within the State, its handling and FPS dealers’ margin as per norms to be devised for this purpose.
• Transparency and Accountability : Provisions have been made for disclosure of records relating to PDS, social audits and setting up of Vigilance Committees in order to ensure transparency and accountability.
• Food Security Allowance : Provision for food security allowance to entitled beneficiaries in case of non-supply of entitled food grains or meals.
• Penalty : Provision for penalty on public servant or authority, to be imposed by the State Food Commission, in case of failure to comply with the relief recommended by the District Grievance Redressal Officer.

By: Vishal