Sunday, September 16, 2012

6 and no more!

The government has decided that henceforth, each Indian household will get 6 LPG cylinders per annum at the subsidised rate of Rs 399 per cylinder, and all further requirement will have to be met by buying the LPG cylinders at the market rate of Rs 746 per cylinder. The government says that 44 % of LPG users in any case  consume 6 or less than 6 cylinders, and they will therefore not be affected by the government's decision.Does it occur to the policy makers that  those who consume 6 cylinders or less may actually wish to consume more if only they had the resources to buy more, that they may not relish the prospect of cooking over wood fire and cow dung simply because they do not earn enough to buy more than 1 cylinder once in two or three months, and that all those who consume more than 6 cylinders per annum are not necessarily profligate consumers who, for reason of their profligacy, do not deserve to have  LPG consumption subsidised?

Is the government aware that those who most deserve the subsidised LPG often buy LPG at astronomical rates because of unethical behviour by the LPG distributors? For the poor, illiterate Indian, who often has to migrate in search of a livelihood, obtaining an LPG connection is still a Herculean task. He does not understand the procedural requirements, is discouraged by the LPG distributor from applying for a connection, and even if he picks up the courage to do so, often does not  have all the documents regarding proof of residence etc. So, he purchases LPG in small quantities at 3 or 4 times the rate at which it is legally sold. He buys it from those unscrupulous people who are in cahoots with the LPG distributor and are allotted gas cylinders on priority. If the government stepped forward to help these households get LPG connections, the subsidy payments would undoubtedly rise. However, the possibility is remote indeed of the LPG subsidy being extended to the impoverished Indians currently outside the net seems by a government which is expressing helplessness at bearing the current subsidy payments, and is endeavouring to lower the amount by  imposing the 6 cylinder cap. 

Unless, the government decides to limit LPG subsidies to the aam aadmi.

Why does the government, which is so stubborn about not universalising the Right to Food and is talking instead in terms of targeting, not implement a targeted LPG subsidy? Why does the government  need to subsidise even 6 cylinders for the Ambanis and the Jindals and their ilk, for the MPs and MLAs and Ministers, for judges of the Supreme Court and High Courts, for Group A government servants in the Centre and the States, for members of  the innumerable Tribunals and Commissions that are manned by retired judges and bureaucrats, for corporate sector employees whose annual  salary packages are higher than the lifetime earning of millions of Indian? There is a long, long list of Indians who live privileged lives, and do not need to have LPG cylinders subsidised as well. If the government cannot think of ways and means to withdraw the LPG subsidy from these privileged millions, why does it not throw the issue open for public debate? Is it possible that a nation of 1.2 billion cannot work out an innovative solution to this minor logistical challenge?

Will the  government also explain why it balks at subsidising LPG cylinders for the aam aadmi when it is so enthusiastic about bailing out public sector undertakings that have run up losses on account of inefficiency, poor decision making, corruption etc. Lets take the example of Air India.  The Comptroller & Auditor General of India (CAG) has, in its Performance Review of Air India, made some extremely damaging observations about the role of the Ministry of Civil Aviation in bringing about what CAG describes as the "current critical state of affairs" in Air India. To quote CAG,

The current critical state of affairs of the merged entity “Air India” is a combination of a multiplicity of factors:
(i) risky acquisition of a large number of aircraft with the intention of vastly expanded operations and “footprint”. In the case of the erstwhile AIL, the large acquisition was clearly driven under the influence of the MoCA;
(ii) a liberalised policy on bilateral entitlements for international air travel introduced by GoI. These agreements, besides not affording adequate time to AIL/ IAL to set their houses in order and gear up for a highly competitive environment, very evidently worked to the detriment of the National and Indian private carriers. 
(iii) an ill-timed merger undertaken strangely after separate aircraft acquisitions by AIL and IAL were completed, driven from the top (rather than by the perceived needs of both these airlines), with inadequate validation of the financial benefits from such a merger and without adequate consideration of the difficulties involved in integration (notably in terms of HR and IT, among other areas); 

The government has not ordered an inquiry into these serious allegations of mis conduct ----why would they, when the alleged mis conduct is that of the Ministry of Civil Aviation, including the then Minister, Praful Patel. Instead, they have announced infusion of additional funds, amounting to Rs 30,000 crore, into the airline, apart from a slew of other measures. When asked how long the tax payers' money would continue to be sunk into Air India, the Civil Aviation Minister said " The government will not continue to lose public money like this indefinitely." That's cold comfort, indeed,because tomorrow never comes!So, notwithstanding the CAG report on the mis management of Air India, the culprits remain unpunished, an additional amount of Rs 30,000 crore is invested in Air India, and the citizen is assured that some day (never mind when!), this blatant abuse of tax payers' money will stop.

In the meantime, what can be and has been curtailed is the expenditure on LPG subsidy!

1 comment:

  1. As public servants, you and I get taxed on perquisites, if any, provided by the employer. Even the 'concession' in interest rate of loan granted by employer is not spared. What is the quantum of the perks enjoyed by politicians - MPs, ex-MPs, ex-Ministers and their ilk? Why should some unworthy be provided special protection at state expense? Why should VIPs invariably travel in a cavalcade? The government and the opposition merely make noise but would they surrender these privileges they enjoy at our cost?