Safety Net Widens: Poor to benefit from electronic fund transfer | The Daily Star
12:00 AM, June 08, 2018 / LAST MODIFIED: 03:14 AM, June 08, 2018

Safety Net Widens: Poor to benefit from electronic fund transfer

The government is going to bring another 12 lakh people under social safety net programmes in the next financial year with the introduction of an electronic fund transfer system to ensure that the money goes directly to the accounts of the beneficiaries.

It has moved to bring the reform in the wake of widespread allegation that the benefits of the safety net schemes do not reach the poor and the fund is misused.

Unveiling the plan, the finance minister yesterday said the government started piloting this initiative last month by giving allowances to 8,499 people through the electronic fund transfer system.

The distribution of allowances for people in old age, widows, tortured women and disabled persons in 11 districts through G2P (government-to-person) payment system will be finalised shortly. Hopefully, it will be rolled out across the country in fiscal 2018-19, according to the budgetary proposals. 

"Gradually, all beneficiaries will be brought under the coverage of this programme. We have already mentioned our initiatives to provide allowances under social safety net to nearly five million people through an EFT [electronic fund transfer] of the G2P system," said Muhith. 

The G2P method will make the social protection programmes target-oriented, transparent and accountable, he added. 

According to the plan, beneficiaries will receive their allowances in their chosen bank accounts or mobile banking accounts.

A digital database based on national IDs has been developed for every social security programmes to prevent duplication in beneficiary selection, Muhith said.

Moreover, new applications for allowances, complaint handling, and budget allocation and disbursement, among others, are also being incorporated in the system. This will ensure the access and right of the common people to the public property and services, he added.

Zahid Hussain, lead economist at the World Bank's Dhaka office, said the FY19 budget intends to expand significantly the beneficiary coverage as well as the rate of allowances under various social safety net programmes. 

It also addresses lacunae in the management of safety nets -- leakage and mistargeting -- by promising to introduce ICT-based G2P payment method to make the programmes target-oriented, transparent and accountable, starting with a pilot project of maternity and old-age allowances in seven upazilas.

The upazilas are Sonargaon, Srinagar, Savar, Tungipara, Kaliganj and Bhairab.

Khondkar Ibrahim Khaled, former deputy governor of Bangladesh Bank, said the government's safety net programme is a very good initiative but the authorities will have to take steps to ensure that it reaches the genuine beneficiaries and it is not misused.

From the next fiscal year, a total of one crore ultra poor, including the freshers, are going to get the benefits under the core programme.

According to the latest survey of the Bangladesh Bureau of Statistics (BBS), the number of ultra poor in the country is more than two crore.

Though the number of beneficiaries has gone up, only five of the total 18 programmes in the core sector have seen rise in allowance.

In the 18 programmes in the next fiscal year, the allocation is Tk 32,422 crore and the number of total beneficiaries is 1.03 crore, according to the finance ministry statistics.

Of the amount, Tk 22,639 crore is kept for 6.3 lakh retired government employees. In the current fiscal year's revised budget, the allocation was Tk 18,412 crore.

Since last year, the government is giving emphasis on increasing the number of beneficiaries rather than the amount so that more people come under the safety net, an effort apparently to make the ultra-poor voters sympathetic to the ruling Awami League in the next polls.

In the current fiscal year, the number of beneficiaries was hiked by seven lakh.

Besides, the next budget is going to introduce some new facilities for freedom fighters.

The government will support insolvent, war wounded and sick freedom fighters or their wives, children or grand children. Tk 400 crore has been allocated in the budget for that.

The freedom fighters get Bangla New Year allowance of Tk 2,000. In addition, they will receive a special Victory Day allowance of Tk 5,000 each.

In the next national budget, the largest rise in number of beneficiaries would be under the Old Age Allowance programme -- to 40 lakh from 35 lakh.

Their allowance will remain unchanged at Tk 500 each a month.

Besides, the number of beneficiaries in the categories of widows and poor women, financially insolvent disabled, tea-labourers has increased.

The number of beneficiaries, and stipends or allowances for the disabled students, transgender, Bede and underprivileged community, patients of serious diseases and maternity allowance for poor and working breastfeeding mothers have been increased.

Some 23 ministries have been running over 100 social safety net programmes. The allocation for them in the next fiscal year is Tk 64,177 crore, which is 2.53 percent of the GDP. In the current fiscal year's revised budget, the allocation was Tk 48,524 crore or 2.17 percent of the GDP.

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