The inclusion of ineligible persons on the beneficiaries list of PM-KISAN raises concerns and undoes the very purpose the scheme was launched for

A significant decline in the number of farmers receiving income transfers under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) Scheme from 104 million during 2021-22 to 80 million during 2022-23 and a corresponding reduction in payment from Rs 67,032 crore in 2021-22 to Rs 57,646 crore in 2022-23 has caused much consternation.

Launched by Prime Minister Narendra Modi on February 24, 2019, and made effective from December 1, 2018, PM-KISAN is a Central Sector Direct Benefit Transfer (DBT) Scheme under which the Union Government. It provides an income support of Rs 6,000 a year to farmers with a valid enrolment, paid in three equal cash transfers of Rs 2,000 each every four months. The money is credited to their account via the DBT mode.

Any landholding farm household is eligible for cash transfers, provided they don’t pay income tax, hold government posts, or are retirees receiving pensions above Rs 10,000. The cutoff date for beneficiary identification based on Agriculture Census 2015-16 estimates is February 1, 2019. The total number of beneficiaries intended to be covered under the scheme was about 140 million.

Since the launch of the scheme, Rs 250,000 crore has been given to nearly 110 million farmers spread over 13 installments. Having decided who should be eligible to receive income transfer, with time, the number of beneficiaries can only increase as more farmers are added to the list. There is no reason for the number to go down. Unlike other schemes such as NREGA, where the number of beneficiaries covered and payments made thereof is linked to the availability of work, under PM-KISAN, all farmers in the beneficiaries list once decided are entitled to receive the money.

It is only plausible that the farmers (24 million) were incorrectly identified and, therefore, ineligible to receive assistance if there was a reduction. Their names have now been dropped from the list. This has ensured that they haven’t received payments during 2022-23 and will not in the future. What about the money already given to them during 2021-22 and even before that?

The Centre claims it has a ‘smooth’ and ‘transparent’ recovery mechanism in place. This is whereby the ineligible beneficiaries are identified and the money is auto-transferred from the state nodal department’s account to the Central Government account. Hopefully, it would have recovered all the excess payments made during the relevant years. The process should be expedited in cases where it hasn’t been done yet. But the inclusion of ‘ineligible’ persons in the beneficiaries list raises concern. This is all the more relevant since the Centre has adopted a robust and foolproof IT-based process for beneficiary identification. Let's look at the steps involved.

The farmer registers on the PM- KISAN portal and the State validates her eligibility; after eligibility verification, the State uploads farmer details on the portal; the portal validates the records for junk data or duplicity; accepted data is forwarded to the public financial management system (PFMS) for account number and type validation; the list is sent back to States for the final approval; eligible records are available for generation of Request for Fund Transfer (RFT); signed RFTs are submitted to PFMS for generation of Fund Transfer Order (FTO); creation of sanction orders by agriculture ministry for approved FTOs; payment is processed and the beneficiary list is made available on the portal.

At all levels of authentication, the rejected data is sent back to the States for correction. At the foundation of this fintech architecture is ‘confirming the genuineness of beneficiaries’; States have the sole responsibility of doing this. In particular, it is important to know which documents they used for this purpose.

On a close scrutiny, it turns out that in the initial years, neither States used Aadhaar for validation nor the Centre made it compulsory; it was required to do so a year after the scheme's commencement. In such circumstances, a large number of ‘ineligible’ persons making their way to the beneficiary list was inevitable. Other issues related to the implementation of the scheme also deserve attention.

When launched, PM-KISAN was designed to supplement the financial needs of small and marginal farmers (SMFs), those with land holding less than 2 hectares, in procuring various inputs such as fertilisers, suitable quality seeds, pesticides, etc. To ensure proper crop health and appropriate yields, commensurate with farm income at the end of each crop cycle.

The scheme was meant to protect poor/vulnerable farmers (read: SMFs). Yet, within six months, from June 01, 2019, its scope was extended to cover all landholding farmers. In other words, the Government decided to give Rs 6,000 even to farmers with large landholdings who didn't deserve it. This meant an increase in beneficiaries by 25 million and expenditure by Rs 15,000 crore.

The Government should exclude better-off farmers from the beneficiaries’ list. The money saved (Rs 15,000 crore annually) should be used to increase SMF support. Within this group, it may also consider giving more to marginal farmers, i.e., those with land holding less than 1 hectare in sync with PM Modi’s philosophy of using national resources for the poorest of the poor.

Farmers in certain States don't benefit from the scheme. For instance, in Bihar, against a total of around 16 million potential beneficiaries, the state has uploaded only 6 million. West Bengal hasn’t joined the scheme, thereby denying access to about 7 million farmers in the State; the Centre is now encouraging those farmers to apply directly on the portal. In other jurisdictions, coverage in some districts is poor. To address it, the Centre has taken some initiatives.

States that have achieved 90 per cent coverage are required to verify 100 per cent 25 randomly selected villages in districts where the coverage is low. In States where the coverage is less than 80 percent, they need to verify 25 villages even in districts that are relatively high. These efforts should be vigorously pursued to ensure that all SMFs get income transfer in every nook and corner of the country.

There are millions of farmers who cultivate the land but don’t own it. But, under the current arrangement for income support under PM-KISAN, they are not eligible; instead, the money is sent to the account of the person who owns the land. This anomaly should be corrected by securing data on all such tenant farmers and transferring the money to their accounts.

Finally, PM-KISAN is meant to meet the small SMF needs. It can’t replace assuring them of a reasonable income on a sustainable basis. This won’t be possible unless they get a reasonable price for their produce. This in turn, will require the resurrection of the now junked three Central farm laws. Unless this is done, episodes similar to that of a farmer from Maharashtra’s Solapur getting a measly Rs 2.49 from the sale of over 5 quintal onions will continue to reverberate.

(The writer is a policy analyst)