Bengaluru: Chief Minister Siddaramaiah is reviewing a proposal to weed out bogus BPL (below poverty line) card holders in an attempt to crack down on the disproportionate number of Karnataka’s population dependent on subsidies in one of India’s most industrious states.
“We are looking into retrieving cards that have been issued to ineligible persons. The food department is currently verifying these cases. No final decision has been taken yet. Ineligible individuals will not retain cards, but eligible beneficiaries will not be denied their entitlements,” Siddaramaiah told reporters in Bagalkote Sunday.
If the number of BPL cards issued are anything to go by, then at least 70 percent of the state’s population are below the poverty line.
Several of the Congress government’s guarantee schemes also rely on BPL cards to dole out benefits in programmes including Anna Bhagya, Gruha Lakshmi, and Gruha Jyothi, among others.
Siddaramaiah said that persons paying income tax or in government service should not hold BPL cards but this was not the case, data suggests. But nearly eight in ten of the state’s residents live below the poverty line despite Karnataka accounting for nearly half of the country’s software exports, and attracting a lion’s share of foreign direct investment (FDI).
Karnataka’s Gross State Domestic Product (GSDP) increased from Rs 22.70 lakh crore in 2022-23 to Rs 25.01 lakh crore in 2023-24 with a growth rate of 10.2 percent, according to the economic survey.
In India, the poverty line is calculated using the Tendulkar or Rangarajan methodology. For instance, the Tendulkar methodology pegs the national poverty line at Rs 816 per capita per month for rural areas and Rs 1,000 per capita per month for urban areas. This means that for a family of five, the poverty line would be Rs 5,000 per month in urban areas and Rs 4,080 per month in rural areas in terms of consumption expenditure. But the poverty line also varies from state to state owing to inter-state price differentials.
The Karnataka government has set up an administrative reforms commission, headed by senior Congress leader R.V.Deshpande, in June to review the extent of BPL cards issued and identify the number of ineligible people claiming benefits meant solely for the economically backward.
“In Karnataka, which is one of the progressive states, about 75-80 percent of its population are BPL card holders. It can’t be believed,” Congress leader and Administrative Reforms Commission chairman R.V. Deshpande told ThePrint.
What numbers show
Going by data from the Department of Food, Civil Supplies & Consumer Affairs, as of 20 September 2024, over 1.25 crore households and 4.34 crore people in Karnataka were identified as beneficiaries of the Antyodaya Anna Yojana (AAY) and the Priority Households (PHH), respectively—both central schemes part of the National Food Security Act (NFSA).
There are 10.72 lakh AAY and 1.028 crore PHH ration card holders in Karnataka. Each AAY household is entitled to 35 kg food grain per month, and each PHH beneficiary to 5 kg food grain per month at a subsidised rate.
The Siddaramaiah-led administration and those before it identify as beneficiaries of Karnataka government schemes those ineligible to pay income tax, GST, as well as those who are AAY or PPH card holders, with the exception of the Congress’s flagship Shakti scheme (free of cost bus rides for women) which can be availed by any woman.
According to economists, this larger issue adds to the state’s ballooning expenses, especially after the Congress came to power and implemented all five of its flagship ‘promises’ or ‘guarantees’.
There is little scrutiny beyond the possession of BPL and AAY cards to claim benefits of these schemes.
“There is an obvious burden on the economy. The implementation of these schemes, brought in for political purposes, has seen the falling back of development. The guarantees are good from a welfare point of view but not at this magnitude,” Professor Abdul Aziz, an economist with the National Law School of India (NLSUI), told ThePrint.
As of August, all five guarantee schemes together provide Rs 4,000-5,000 per family per month through direct or indirect benefits, according to the state government.
In his Independence Day speech, Siddaramaiah said women availed 270 crore free trips across the state under the Shakti Scheme, amounting to Rs 6,541 crore. To be sure, there are no economic parameters to avail the scheme.
Under the Gruha Lakshmi Yojana, which assures Rs 2,000 per month to the woman head of the household, Rs 25,259 crore have been disbursed to 1.2 crore women since its launch last year. For this scheme too, there is no criteria mandating a BPL or AAY card.
Under the Anna Bhagya scheme, the state expenditures have amounted to Rs 7,763 crore. While the scheme provides 10 kg of free rice, since there is a shortage, the state government has been handing out cash for 5 kg instead.
Under the Gruha Jyothi scheme for free power, 1.60 crore families have availed of Rs 8,844 crore in benefits. And, lastly, 1.31 lakh unemployed graduates and diploma holders were given Rs 91 crore until they could find employment in the last one year.
In the Economic Survey of Karnataka 2023-24, the government said “subsidies in Karnataka are higher than any comparable states and within that non-merit component appear to be larger” and their rationalisation would free up more resources for other development and infrastructure projects.
Productive expenditure, which includes scholarships, subsidies, special development plans, and other programmed expenses, accounts for Rs 172,160.36 crore, or 52 percent of the state budget. Further classifications show that 319 beneficiary-oriented schemes account for Rs 95.964.38 crore, or 56 percent of productive expenditure.
Professor Aziz said there is also a psychological aspect to acquiring these BPL cards because not all applicants seek benefits, like free rice, but don’t want to surrender their cards.
The way forward
There have been instances where income certificates are handed out even by village accountants, who can knowingly or unknowingly introduce errors that lead people who are ineligible to acquire the cards.
Dual income certificates, where two partners are earning, officials said, compound the problem. There are also local reports of resale where some families are selling the 5 kg of rice availed under the Anna Bhagya scheme, defeating the entire purpose of the scheme.
Under earlier reviews, 3.38 lakhs ineligible AAY and PHH cards were identified and cancelled or converted to Non-Priority Households between April 2022 and September 2023.
“Those who are not entitled, if they have tried to play with the law or the regulations, the government will have to intervene. But it is up to the government to accept our recommendations as our report will not be binding,” Deshpande said.
He said that the sub-committee will work within the existing framework and guidelines and recommend that the government weed out ineligible beneficiaries. From there, the decision on how to take it forward will rest with the state government.
A senior government official told ThePrint that if the exercise to weed out ineligible people is done effectively, “at least 30 lakh cards can be taken back”.
(Edited by Sangya Mathur)