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India: Why we Oppose the Rush to Cash Transfers and UID - concerned citizens statement

26 December 2012

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Cash Transfers and UID: Essential Demands

We support cash transfers such as old age pensions, widow pensions, maternity entitlements and scholarships. However, we oppose the government’s plan for accelerated mass conversion of welfare schemes to UID-driven cash transfers. This plan could cause havoc and massive social exclusion. We demand the following:

1. No replacement of food with cash under the Public Distribution System.

The PDS is a vital source of economic security and nutrition support for millions of people. It should be expanded and consolidated, not dismantled.

2. Immediate enactment of a comprehensive National Food Security Act, including universal PDS.

Instead of diverting the public’s attention with promises of mass cash transfers before the 2014 elections, the government should redeem its promise to enact a National Food Security Act (NFSA).

3. Cash transfers should not substitute for public services.

While some cash transfer schemes are useful, they should complement, not substitute for the provision of public services such as health care, school education, water supply, basic amenities, and the PDS. These services remain grossly under-funded.

4. Expand and improve appropriate cash transfers without waiting for UID.

There is no need to wait for UID to expand and improve positive cash transfer schemes such as pensions, scholarships and maternity entitlements. For instance, social security pensions should be increased and universalized.

5. No UID enrolment without a legal framework.

Millions of people are being enrolled for UID without any legal safeguards. The UIDAI’s draft bill has been rejected by a parliamentary standing committee. UID enrolment should be halted until a sound legal framework is in place.

6. All UID applications should be voluntary, not compulsory.

UID should never be a condition for anyone to access any entitlements or public services. A convenient alternative should always be available.

7. UID should be kept out of the PDS, NREGA and other essential entitlement programmes for the time being.

Essential services are not a suitable field of experimentation for a highly centralised and uncertain technology. Other applications (e.g. to tax evasion) should be tried first.

Explanatory Note:

Why we Oppose the Rush to Cash Transfers and UID

We support cash transfers such as old age pensions, widow pensions, maternity entitlements and scholarships. In fact, many of us have been part of struggles to expand social security pensions and improve their delivery. We also support appropriate, people-friendly uses of modern technology for this purpose.

However, we have serious reservations about the government’s rush to link these cash transfers to “Aadhaar†, the unique identity (UID) number. This is because the linking of these schemes can cause huge disruption – think of an old man who is currently getting his pension from the local post office, but will now have to run around getting his “UID-enabled†bank account activated and then may find his pension held up by fingerprints problems, connectivity issues, power failures, truant “business correspondents†, and what not.

We are also firmly opposed to the introduction of cash transfers in lieu of food and other commodities supplied through the Public Distribution System, for many reasons. One, subsidized food from the PDS is a source of food and economic security for millions of poor families. In 2009-10, implicit transfers from the PDS wiped out about one fifth of the “poverty gap†at the national level, and close to one half of it in states like Tamil Nadu and Chhattisgarh. Recent experience also shows that it is possible to further revamp and reform the PDS without delay.

Two, the banking system in rural areas is not ready to handle large volumes of small transfers. Banks are often far and overcrowded. The alleged solution, banking correspondents, is fraught with problems. Post offices could possibly be converted into useful payment agencies, but this will take time.

Three, rural markets are often poorly developed. Dismantling the PDS would disrupt the flow of food across the country and put many people at the mercy of local traders and middlemen.

Four, there are concerns of special groups such as single women, disabled persons and the elderly who cannot easily move around to withdraw their cash and buy food from distant markets.

Last but not least, inflation could easily erode the purchasing power of cash transfers. When the government refuses to index pensions or NREGA wages, how can it be trusted to index cash transfers to the price level? Even if some indexation does happen, small delays or gaps in price information could cause significant hardship for poor people.

The Kotkasim fiasco is a telling example of the potentially disruptive effects of inappropriate cash transfer schemes. The experiment was launched with much fanfare and immediately projected as a “stunning success†based on the fact that kerosene subsidy expenditure had declined by 80%, but in fact, the main reason for this decline was the collapse of the entire kerosene distribution system.

An impression has been created that the government is all set to launch UID-enabled cash transfers on a mass scale before the 2014 elections. This is very misleading, and looks like an attempt to make people rush to UID enrolment centres. This announcement also diverts attention from the government’s failure to enact a National Food Security Act. The food security bill, very weak in the first place, has been languishing with a Standing Committee for a whole year. Meanwhile, food stocks are accumulating on an unprecedented scale. The need of the hour is a comprehensive National Food Security Act, not a potentially disruptive rush for UID-driven cash transfers.

List of Signatories

  1. Sunil Abraham, Centre for Internet and Society
  2. Pushpa Achanta, Writer
  3. Bina Agarwal, Professor, Institute of Economic Growth
  4. Samantha Agarwal, Activist, Raipur
  5. Ankita Aggarwal, Researcher, New Delhi
  6. Ashutosh Agrawal, Student
  7. Anivar Aravind, Entrepreneur, Technology Manager
  8. Chirashree Das Gupta, Ambedkar University
  9. Indu Agnihotri, Director, Centre for Women’s Development Studies
  10. Sohail Akbar, Associate Professor, Jamia Milia Islamia
  11. Evangeline Anderson-Rajkumar, United Theological College Bangalore
  12. Janki Andharia, Tata Institute of Social Sciences
  13. Sadhna Arya, University of Delhi and Saheli Women’s Resource Centre
  14. K.V. Nagesh Babu, Assistant Professor, Tata Institute of Social Sciences
  15. Amiya Kumar Bagchi, Vice Chancellor, Tripura University
  16. Megha Bahl Student, Faculty of Law, University of Delhi
  17. Arindam Banerjee, Jawaharlal Nehru University
  18. Arindam Banerjee, Assistant Professor, Ambedkar University
  19. Sreshtha Banerjee, Social Activist
  20. Sanjay (Xonzoi) Barbora, Tata Institute of Social Sciences (Guwahati)
  21. Kripa Basnyat, PWESCR, Programme on Economic, Social and Cultural Rights
  22. Moushumi Basu, Associate Professor, Jawaharlal Nehru University
  23. Akansha Batra, Junior Research Fellow, Indian Statistical Institute
  24. Anjali Bhardwaj, Satark Nagrik Sangathan
  25. Bharat Bhatti, Student, Ambedkar University
  26. Kiran Bhatty, Senior Fellow, Centre for Policy Research
  27. Praful Bidwai, Journalist
  28. Ramila Bisht, Associate Professor, Jawaharlal Nehru University
  29. Arudra Burra
  30. Kathyayini Chamaraj, Journalist
  31. C.P. Chandrashekhar, Professor, Jawaharlal Nehru University
  32. Sarika Chaturvedi, Ph D scholar, Karolinska Institute, Sweden
  33. Aheli Chowdhury, JOSH, Delhi
  34. Arati Choksi, People’s Union for Civil Liberties, Bangalore
  35. Gowru Chinnapa, Bangalore
  36. Priti Darooka, PWESCR, Programme on Economic, Social and Cultural Rights
  37. Jitu Das, Alghanim Industries
  38. Asit Das
  39. Anirban Dasgupta, South Asia University
  40. Jashodhara Dasgupta, National Alliance for Maternal Health and Human Rights
  41. Saurav Datta
  42. Ashwini Deshpande, Professor, Delhi School of Economics
  43. Ritu Dewan, Mumbai University
  44. Nikhil Dey, Mazdoor Kisan Shakti Sangathan
  45. Harish Dhawan, Associate Professor in Economics, University of Delhi
  46. Arundhati Dhuru, National Alliance of People’s Movements
  47. Gabriele Dietrich, National Alliance of People’s Movements
  48. Sarah Dobinson, PWESCR Programme on Economic, Social and Cultural Rights
  49. Jean Drèze, Visiting Professor, Allahabad University
  50. Ajit Eapen
  51. Warisha Farasat, Lawyer
  52. Jayati Ghosh, Professor, Jawaharlal Nehru University
  53. Kaveri Gill, Independent researcher
  54. S. S. Gill, Director General, CRRID, Chandigarh
  55. Paranjoy Guha Thakurta, Journalist
  56. Aashish Gupta, Research Assistant, Allahabad University
  57. Ruchi Gupta, National Campaign for People’s Right to Information
  58. Zoya Hasan, Professor, Centre for Political Studies, Jawaharlal Nehru University
  59. Neeraj Hatekar, Professor, Department of Economics, University of Mumbai
  60. Rohini Hensman, Independent scholar and author
  61. Himanshu, Assistant Professor, Jawaharlal Nehru University
  62. Danish Husain, Actor
  63. Indira C, Researcher Public Health, Delhi
  64. Kaveri Rajaraman Indira, Concern, Indian Institute of Science
  65. Jaya Iyer, Khadya Nyaya Abhiyan
  66. Devaki Jain
  67. K.P. Jayasankar, Professor, Tata Institute of Social Sciences
  68. Praveen Jha, Jawaharlal Nehru University
  69. Sadan Jha, Assistant Professor, Centre for Social Studies, Surat
  70. Ravinder Jha, Miranda House, University of Delhi
  71. Rajiv Jha, Shri Ram College of Commerce, University of Delhi
  72. Amrita Johri, Satark Nagrik Sangathan
  73. Sunny Jose, Associate Professor, Tata Institute of Social Sciences
  74. Aleesha Mary Joseph, Student, St. Stephen’s College
  75. Deep Joshi
  76. Vijay Lakshmi Joshi, People’s Union for Civil Liberties
  77. K. P. Kannan, Chairman, Lawry Baker Institute of Habitat Studies, Thiruvantanthapuram
  78. Anirban Kar, Associate Professor, Delhi School of Economics
  79. Ashok Khandelwal, Economist
  80. Madhulika Khanna, Researcher, New Delhi
  81. Sushil Khanna, Indian Institute of Management Calcutta
  82. Reetika Khera, Assistant Professor, Indian Institute of Technology, Delhi
  83. Asha Kilaru, Public Health Researcher, Bangalore
  84. Ashish Kothari, Kalpavriksh
  85. Subasri Krishnan, Filmmaker
  86. Kavita Krishnan, CPI(ML) Liberation
  87. Abhay Kumar, Karnataka
  88. Richa Kumar, Assistant Professor, Indian Institute of Technology, Delhi.
  89. Awanish Kumar, Ph.D. Scholar, Tata Institute of Social Sciences
  90. Madhuresh Kumar, National Alliance of People’s Movements
  91. A.K. Shiva Kumar, Economist
  92. Lawrence Liang, Alternative Law Forum
  93. Kamayani Bali Mahabal, Advocate
  94. Neeraj Malik, University of Delhi
  95. Anubhuti Maurya, Bharati College, University of Delhi
  96. Surajit Mazumdar
  97. Indrani Mazumdar, Centre for Women’s Development Studies
  98. Bhanwar Meghvanshi, Dalit Adivasi Aur Ghumantu Adhikar Abhiyan, Rajasthan
  99. Subhash Mendhapurkar, SUTRA, Himachal Pradesh
  100. Aggie Menezes, Associate Professor, St Xavier’s College
  101. Mira Mehta, Department of Nutrition and Food Science, University of Maryland
  102. Kalpana Mehta, Manasi Swasthya Sansthan, Indore
  103. Ritambhara Mehta, Independent Researcher
  104. Nivedita Menon, Professor, Jawaharlal Nehru University
  105. Rajkishore Mishra, Orissa
  106. Srijith Mishra, Associate Professor, Indira Gandhi Institute of Development Research
  107. Gautam Mody, Secretary, New Trade Union Initiative
  108. Mritiunjoy Mohanty, Professor, Indian Institute of Management, Calcutta
  109. Sanat Mohanty, Associate Professor, Indian Institute of Technology, Delhi
  110. Anjali Monteiro, Professor, Tata Institute of Social Sciences
  111. Vipul Mudgal, Inclusive Media for Change, Centre for the Study of Developing Societies
  112. Prakriti Mukerjee, Yoda Press
  113. Poonam Muttreja, Population Foundation of India
  114. Tithi Nandy, Healthwatch Forum Uttar Pradesh
  115. R. Nagaraj, Professor, Indira Gandhi Institute of Development Research
  116. Farah Naqvi, Writer and Activist
  117. Sudha Narayanan, Assistant Professor, Indira Gandhi Institute of Development Research
  118. Rajendran Narayanan, Visiting Scientist, Indian Statistical Institute
  119. Arvind Narrain, Alternative Law Forum
  120. Saboohi Nasim, Assistant Professor, Aligarh Muslim University
  121. Balaji Narsimhan
  122. Nandini Nayak, School of African and Oriental Studies, University of London
  123. P. Niranjana, Assistant Professor, Tata Institute of Social Sciences
  124. V.P. Niranjanaradhya, National Law School of India University
  125. Claire Noronha, Collaborative Research and Dissemination
  126. Madhurima Nundy, Institute of Chinese Studies
  127. Gangaram Paikra, Right to Food Campaign, Chhattisgarh
  128. Parthapratim Pal, Associate Professor, Indian Institute of Management Calcutta
  129. Sandeep Pandey, National Alliance of People’s Movements
  130. Soma Kishore Parthasarathy, PhD scholar, Indian Institute of Technology Bombay
  131. Medha Patkar, National Alliance of People’s Movements
  132. Prabhat Patnaik, Retired Professor, Jawaharlal Nehru University
  133. Utsa Patnaik, Retired Professor, Jawaharlal Nehru University
  134. Boban V. Paul, NGO professional
  135. Pamela Philipose, Director, Women’s Features Services
  136. Neetha Pillai, Senior Fellow, Centre for Women’s Development Studies
  137. Dr Prabir, Independent Consultant, West Bengal
  138. Pranesh Prakash, Law and Policy Researcher
  139. Mythri Prasad, Researcher, French Institute of Pondicherry
  140. T. V. H. Prathamesh, Research Scholar, Indian Institute of Science, Bangalore
  141. Raghav Puri, Independent Researcher
  142. Pushpendra, Director, Centre for Social Studies, Surat
  143. Kalyani Raghunathan, Ph.D. Scholar, Cornell University
  144. Annie Raja, National Federation of Indian Women
  145. Jawahar Raja, Advocate, Delhi
  146. Suvrat Raju, Reader, International Centre for Theoretical Sciences, Mumbai
  147. R. Ramakumar, Associate Professor, Tata Institute of Social Sciences, Mumbai
  148. Kannama Raman, Associate Professor, University of Mumbai
  149. Usha Ramanathan, Legal Researcher
  150. Ashish Ranjan, Birla Institute of Technology, Patna
  151. Bharat Rastogi, Graduate student, University of California Santa Barbara
  152. Savitri Ray, FORCES Network, Centre for Women’s Development Studies
  153. Mohan Rao, Professor, Jawaharlal Nehru University
  154. E. Rati Rao, People’s Union for Civil Liberties Karnataka
  155. Vidya Rao, Jain Vishva Bharati Institute, Rajasthan
  156. D. Narsimha Reddy, Chair Professor, NIRD, Hyderabad
  157. Rammanohar Reddy, Editor, Economic and Political Weekly
  158. Dr. K. Srinath Reddy
  159. Ira Regmi, Student, Lady Shri Ram College for Women
  160. Rohit, Assistant Professor, South Asia University
  161. Aruna Roy, Mazdoor Kisan Shakti Sangathan
  162. Saheli Women’s Resource Centre Sahyogi, Patna
  163. Preeti Sampat, Independent Researcher
  164. Meera Samson, Collaborative Research and Dissemination
  165. Sunil D. Santha, Assistant Professor, Tata Institute of Social Sciences
  166. Radha Kant Saxena, People’s Union for Civil Liberties
  167. Sukla Sen, EKTA (Committee for Communal Amity), Mumbai
  168. S. Seshan
  169. Sudeshna Sengupta, Mobile Crèches
  170. Mitu Sengupta, Centre for Human Development and Human Rights, New Delhi
  171. Prem Krishan Sharma, President, People’s Union for Civil Liberties, Rajasthan
  172. Saurabh Sharma, JOSH, Delhi
  173. Veena Shatrugna, Former Deputy Director, National Institute of Nutrition
  174. Jeevika Shiv
  175. Dr. Mira Shiva, Initiative for Health & Equity in Society
  176. Rama Shyam, Tata Institute of Social Sciences
  177. Aditya Shrivastava, Advocate
  178. Shankar Singh, Mazdoor Kisan Shakti Sangathan
  179. Bhanwar Singh, Astha
  180. Mahipal Singh, National Secretary, People’s Union for Civil Liberties
  181. Paramjeet Singh, People’s Union for Democratic Rights
  182. Surjit Singh, Director, Institute of Development Studies, Jaipur
  183. Dipa Sinha, Ph.D. Scholar, Jawaharlal Nehru University
  184. Shantha Sinha, National Commission for the Protection of Child Rights
  185. Ahmed Sohaib, Jamia Teachers’ Solidarity Association
  186. Gautam Sonti
  187. Vivek Srinivasan, Stanford University
  188. Nisha Srivastava, University of Allahabad
  189. Ravi Srivastava, Professor, Jawaharlal Nehru University
  190. Shambhavi Srivastava, Graduate student, University of British Columbia
  191. Kavita Srivastava, National Secretary, People’s Union for Civil Liberties
  192. Sulakshana, Right to Food Campaign, Chhattisgarh
  193. Nandini Sundar, University of Delhi
  194. Mayur Suresh, Ph.D. Scholar, University of London
  195. V. Suresh, General Secretary, People’s Union for Civil Liberties
  196. Kamayani Swami, Jan Jagran Shakti Sangathan
  197. Padmini Swaminathan, Tata Institute of Social Sciences, Hyderabad
  198. M.S. Swaminathan, Member of Parliament, Rajya Sabha
  199. Sharmila Tagore
  200. Krishan Takhar, People’s Union for Civil Liberties
  201. Vamsi Vakulabharanam, Reader, University of Hyderabad
  202. Padma Velaskar, Professor, Tata Institute of Social Sciences
  203. G. Vijay, Assistant Professor, School of Economics, University of Hyderabad
  204. M. Vijayabaskar, Madras Institute of Development Studies, Chennai
  205. Vimochana, Forum for Women’s Rights
  206. Achin Vanaik, Retired Professor, University of Delhi
  207. Sujata Visaria, Hong Kong University of Science & Technology
  208. Bezwada Wilson, Safai Karamchari Andolan