The federal cabinet has approved the launch of Ehsaas Rashan Madad Program (Ehsaas Commodity Subsidy Program) for 20 million families across the country. The programme is worth Rs. 120 billion and it will help to reduce the impact of inflation for most vulnerable people.
Under the Ehsaas Rashan Madad Program, the household people who have less than Rs. 31,500 income per month will be eligible to get a subsidy of Rs. 1,000 per family per month to cover staple food items, including wheat flour, pulses (daal), and cooking oil besides 25% of the food spend for low-income households to reduce inflationary impact on those vulnerable due to the rising inflation.
The Government has authorized the National Bank of Pakistan (NBP) to handle the execution of the Ehsaas Commodity Subsidy Program in collaboration with Ehsaas, while the Ministry of Finance will undertake the fiscal management and oversight of the initiative.
The Federal Government and Federating Units will share the fiscal resources in the ratio 35/65 under the Ehsaas Rashan Madad Program. This will not include Sindh and Balochistan as they have not joined the programme yet and the budgetary allocation may change if both these provinces come on board.
Moreover, the Government will reported give 5-10% (recommended) 8%) incentive for Kiryana Stores for (Rs. 12 / subsidy transaction) on the value of the subsidy amounting to Rs. 7.3 billion for Fiscal Year (FY) 2021. This is to encourage them to shift from cash based transactions to digital transactions, open their bank accounts and purchase/install internet-enabled devices and compensate them for additional time spent on processing the transactions.
The Poverty Alleviation and Social Safety Division informed the cabinet that Pakistan has seen a massive increase in the commodity prices with prices of 3 major food items rising by 15% within a year and while these domestic increases are being driven by rise of prices in international market, it is an important policy objective for the Government to implement inflationary control measures.
The Special Assistant to Prime Minister on Poverty Alleviation and Social Safety Dr Sania Nishtar informed the cabinet that the Government wants to help financially struggling people by launching the Ehsaas Targeted Commodity Subsidy Program (Ehsaas Rashan Madad Program) and the State Bank of Pakistan (SBP) has nominated the National Bank of Pakistan as the sole national agent for this subsidy program.
The Ehsaas Rashan Madad Program is designed to be a precision-target system of subsidy delivery focusing on the deserving beneficiaries to provide them with the financial assistance needed for the purchase of basic commodities at discounted rates through digital processed transactions at Ehsaas Targeted Commodity Subsidy Program (ETCSP) enlisted stores, using a Mobile P (mPOS). This program will include outlets of the Utility Stores Corporation and local Kiryana Stores.
Like all other initiatives of the Ehsaas Program, the enlisted stores and beneficiaries will go through rigorous verification process under the Ehsaas Rashan Madad Program in order to minimize the incidence of fraud.
The beneficiaries will register through a secure portal for the Ehsaas Rashan Madad Program (Ehsaas Targeted Commodity Subsidy Program) like other initiatives of the Ehsaas Program. The eligibility cut-off will be authenticated through Benazir Income Support Program (BISP), family information validated by NADRA and CNIC-Mobile number pairing certified by Pakistan Mobile Number Portability Database (PMD, PTA).
The beneficiaries who avail the subsidy will have to go through 2-factor authentication consisting of physical verification of CNCI and an OTP sent to the beneficiary on their mobile number, meanwhile, the Kiryana Stores will go through all checks mandated by the SBP including CNIC verification by NADRA, SIM ownership authentication by PMD/PTA, all banking checks and biometric veification.
It bears mentioning that Ehsaas and NBP have already been testing the programme in several cities with hundreds of beneficiaries and Kiryana Stores, who participated in the Ehsaas Rashan Program.
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