Odisha CM Naveen Patnaik does a U-turn, decides to implement DBT for pension in state

In a move that will inconvenience several thousands of pensioners, the Odisha government has decided to implement the direct benefit transfer (DBT) in the state. It will be applicable for those availing pension under the National Social Assistance Programme (NSAP) and Madhu Babu Pension Yojana (MBPY). This is a reversal of CM Naveen Patnaik’s earlier stand.

The order, which was sent on October 23, 2019, states that pension will be disbursed under both the schemes through DBT mode from November itself. In gram panchayat areas, it will begin from December onwards.

The order asks all beneficiaries to reach their banks to seed their Aadhaar details for verification to either open new accounts where the pension will be transferred to or link existing accounts with their Aadhaar details to ensure the release of the pension through DBT mode. All pensioners have been asked to provide their bank passbook and Aadhaar details when they go to collect their pension at the end of October.

The order comes less than two years after the Odisha CM Naveen Patnaik had written to Prime Minister Narendra Modi indicating his reservations about Direct Benefit Transfer mode. He had said the payment made through banks would bring added misery to the beneficiaries. “Any imposition of the system of bank payment will cause undue and unavoidable hardship to the vulnerable beneficiaries. I am sanguine you would appreciate the special circumstances of the State and not impose conditions on the release of funds which may militate against the interest of the beneficiaries,” Patnaik had written in December 2017.

Pointing towards National Social Assistance Programme (NSAP) rules, Patnaik had said that as per NSAP guidelines, disbursement of pension must be done in accordance with the choice and convenience of the beneficiaries. In the letter, he had stated that Odisha had conducted a survey among the beneficiaries and found that pensioners were not willing to accept pension through banks and post offices.

According to Patnaik at the time, 4,376 gram panchayats (GPs) in Odisha have no banking facilities. “Even the existing banks are unable to bear the burden of large number of pensioners due to acute staff shortage. The State has been disbursing pension in cash on 15th of every month at the GPs and urban local bodies' headquarters,” Patnaik had written in his letter to the PM.

The situation on the ground has not changed much even two years later, but that does not seem to concern the Odisha government.

The district collectors have been informed that this process has to be completed in the urban areas by November 15, 2019, and in gram panchayat areas by December 15, 2019.

However, as a saving grace, the notice states that beneficiaries in rural areas can opt to receive their payments in cash until adequate banking infrastructure is set up in proximity to their gram panchayats.

Several activists believe that this decision will end up being even more of a disaster than the PDS. “There is pressure from the Central government. They want all the pension beneficiaries under National Social Assistance Programme to be linked with Aadhaar and the government’s logic is that this will help weed out duplication. Now, even more vulnerable people, especially the elderly, will fall out of the system. The Central government is likely to have threatened that they would stop sending funds for pension transfer,” said Sameet Panda, convenor of Orissa Right to Food chapter.

In Jharkhand, DBT for pension has wreaked havoc for the poor. Several poor people did not know what they had to do, while others faced issues with biometric authentication. A few others struggled due to the inconsistencies between the Aadhaar and the bank database. According to economist and right to food campaigner Jean Dreze, senior citizens were the most affected.

Several problems occur while seeding of bank accounts with Aadhaar and to ensure that this was done, e-KYC was made compulsory. And if people didn’t do it by a certain date, their accounts were blocked, and people would not be allowed to withdraw their pensions. Several thousands in Jharkhand have still not understood why their pensions were discontinued after DBT began.

In Jharkhand, most of those whose names were removed were extremely poor. As a result, several people have died in Jharkhand due to hunger and poverty as they used to depend on this pension from the state to buy ration. According to a report in 2018, 14 of the starvation deaths in Jharkhand in 10 months were due to Aadhaar glitches. Most of them belonged to “particularly vulnerable tribal group” and should have had access to Antodyay Anna Yojana (AAY), the food ration scheme meant for the extremely poor in the country. But, most of them could not get their ration due to complications that arose from the Jharkhand government rule that ration cards and bank accounts be linked to Aadhaar.