Lok Satta Clarifies Stand on Power Subsidies and Subsidised Rice

Dear Sri Sainath,

I invite your kind attention to your column on Oct 12 in The Hindu: ‘Incredible India’ right here at home.

[Click on the link below for the article on Hindu

http://www.hindu.com/2007/10/12/stories/2007101255291200.htm]

You made a reference to Lok Satta Party’s (LSP) platform on subsidies. I would like to clarify the Party’s stand on power subsidy to farmers and subsidized rice.

1. Power subsidy

Lok Satta Party believes that the debate on power tariff for agriculture is skewed. In the AP context, TDP government collected about 2 – 10% tariff through slab rates (Rs 50 per HP. Later raised to Rs 250 per HP). The current Congress government is offering it free of cost. All that is being debated is whether power should be free, or upto 10% of tariff should be collected. LSP believes this is a spurious debate on a non-issue for the following reasons:

Un-metered power, poor distribution management, and corruption are causing loss of nearly 27% of power.

Farmers are getting low quality power with voltage fluctuations, and often motors get burnt about twice a year on an average. Each time repairs cost about Rs 2000 – 3000, resulting in an annual expenditure of about Rs 5000 for each farmer with an agriculture pumpset.

Villages get very poor quality of power, often interrupted by outages or load shedding. In many villages about 6 hours’ power supply in summer is the norm. Even PHCs and schools run without power.

Corruption is rampant in power sector at every level.

Lok Satta movement outlined all these problems as early as in 2000, and argued for decentralized distribution management with effective energy auditing. Lok Satta Times’ issue of October 2000 examined the issue in detail. A team of experts including late Dr Tatarao, Sri Balaramireddy, Sri TL Shankar, Capt Jalagam Ramarao, Sri KP Rao and Sri SR Vijayakar examined the power sector crisis and recommended solutions.

As a result of Lok Satta’s advocacy, four feeder lines in Andhra Pradesh were handed over to franchisees for effective distribution management. The results, despite bureaucratic hurdles, corruption and lethargy, were impressive. In Kallacheruvu of West Godavari district, the line losses were reduced from 27% to 9% (a saving of 18%). Voltage was fully stabilized in farm sector, and incidence of damage to pumpsets was brought down to zero! Corruption was eliminated with people’s participation. Under one feeder alone, over ten youngsters were trained and employed in a sustainable manner.

Lok Satta Party has been advocating replication of such a model in the whole state. The power savings will be of the order of Rs 2500 crore, about 100,000 jobs will be created, voltage will be stabilized, and villages can be supplied quality power round the clock. Our party has made a public commitment to achieve these results. In such a model, power tariff for agriculture is a short-term, marginal issue. Farmers can be assured quality supply, villages will get 24 hour power supply, and the power subsidies can be continued for sometime until farmers’ condition improves. This rational management of power sector is Lok Satta Party’s stand; not casual and irresponsible populism. Sadly, given the low quality of our public discourse and lack of depth in debate, issues are seen in simple ‘Yes’ or ‘No’ terms.

2. Subsidized Rice:
Lok Satta Party has not offered any additional food subsidies. We are merely committed to two things:

Better targeting of all food subsidies including free rice now available to the indigent (Annapurna Antyodaya scheme).

Transfer of public distribution to the district government, and offering the subsidy saved by better targeting as an incentive to the local government to enhance its resources.

Right now, for a population of under 8 crore, 1.8 crore families are covered by food subsidies to which the poor one entitled. Official rural poverty figures in AP are at 16%, and probably 30 – 40% people deserve food subsidies. And yet, over 90% of the people are covered now! Despite this there are lakhs of poor families which do not have a ration card! This is what needs to be set right, and Lok Satta Party is committed to revamping the public distribution system.

I hope you will take note of our stand and inform your readers, so that serious and rational debate on subsidies can be promoted.

With warm regards,
Jayaprakash Narayan
(National Coordinator)