ISLAMABAD: The government has taken a fundamental decision that subsidies should be targeted to benefit the poor rather than being untargeted. Previously, untargeted subsidy programmes contributed to increase in inequality. Under the untargeted subsidies, the benefits were enjoyed indiscriminately by both rich and poor. Even individuals who could easily afford market prices also enjoyed the benefits of subsidized pricing. Hence, targeted subsidy programmes are more effective, as the benefit of subsidies flows exclusively to those in need.
Currently, the federal government is introducing targeted subsidies for Ehsaas beneficiaries through IT integration between Ehsaas and Utility Stores Corporation of Pakistan (USC).In line with this, Ehsaas has been working with USC to integrate their IT systems with those of state-run USC so that they can identify Ehsaas beneficiaries and pass on targeted subsidy to them. To promote economic welfare, targeted subsidization policy is hinged on IT enabled system to reduce poverty y among the deserving.
Today, Dr Sania Nishtar visited the USC Headquarters and reviewed the final status of integration. Detailing in a press statement, Dr. Nishtar said, “I am very happy to see that the Information Technology teams of both USC and Ehsaas have worked very hard. The process of integration is now seamlessly working, and this will enable USC to identify Ehsaas beneficiaries giving them targeted subsidies on certain food items.” She then continued, “We hope that the installation of hardware at the USC will be completed as soon as possible so that the system can be up and running all over the country.”
Managing Director USC, Umer Lodhi was also present on the occasion. He said that USC will be fully equipped to synergize with Ehsaas programme by June 2021. It will be equipped to launch targeted subsidy program in conjunction with Ehsaas Program across Pakistan. USC is thankful to ‘Senator Sania Nishtar’ for guiding and helping USC for the past two years in initiation of its digitalization process.
In this integrated initiative, there is greater emphasis on targeting that will be administered through Ehsaas database.
These targeted subsidies will be given on selected essential commodities. Targeted subsidization is more beneficial for pro-poor economic welfare. Using the Ehsaas data, this new system will improve the efficiency of subsidy delivery mechanism for better results.—PR
Copyright Business Recorder, 2021