PM gives go-ahead for direct cash subsidy transfer plan

Prime Minister Manmohan Singh has given a major push to direct transfer of individual benefits directly into the bank accounts of beneficiaries of the various welfare schemes of the government by fast-tracking implementation of the electronic cash transfer system.   

The idea is to move to a completely electronic cash transfer system for the entire population. This is to be done in a fast-track, accelerated mode to be achieved in a time-bound manner, an official release said on Friday.

Once the electronic cash transfer system is in place, the government will transfer subsidies and wages under schemes such as the rural employment scheme (MNREGA) directly to the beneficiaries' bank accounts.

Payments for scholarships, pensions, income support of other types and health benefits and also food and fertiliser subsidy will be made the same way.

The ministerial coordination committee will be assisted by a National Executive Committee comprising secretaries of all concerned ministries. This committee will meet frequently to coordinate action, ensure adherence to timelines and sort out hitches in the programme as it is rolled out.

The committees will finalise all operational and implementation details relating to the design and operation of the transfer system. Besides, there will be separate sub-committees for cash transfer and technology and IT issues.