Budget 2016: Jaitley sees FY17 total subsidy outgo at Rs 2.5 lk cr

Finance minister Arun Jaitley has pegged FY17 total subsidy outgo at Rs 2.5 lakh crore, within which food subsidy outgo is pegged at Rs 1.35 lakh crore and petroleum subsidy is seen at Rs 26,900 crore.Economy watchers were expecting the pan-India roll-out of the National Food Security Act to take the food subsidy number to new highs. To plug loopholes, Jaitley has also proposed a social security platform which will be developed using the Aadhar framework to target the right beneficiaries — the poor and the vulnerable. "We will introduce a bill for Targeted Delivery of Financial and Other Subsidies, Benefits and Services by using the Aadhar framework. A social security platform will be developed using Aadhar to accurately target beneficiaries," Jaitley said in his Budget speech. 

He also spoke about introducing Direct Benefit Transfer (DBT) on a pilot basis for fertiliser subsidy. "...We have already introduced a direct benefit transfer (DBT) in LPG. Based on this successful experience, we proposed to introduce DBT on pilot basis for fertiliser in few districts in the country with a view to improving quality of service delivery to the farmers," the finance minister said.Other than that, he also said of the 5.35 lakh Fair Price Shops in the country, automation facilities will be provided in 3 lakh Fair Price Shops by March 2017.

The government has been trying hard to rein in expenditure with respect to subsidies, since coming to power. To that extent, the Economic Survey 2015-16 that was presented in the Lok Sabha on Thursday by Finance Minister Arun Jaitley, had pointed out that there was uneven distribution of subsidies worth Rs 1 lakh crore, which was going to the better-off and those who did not deserve.

Prior to the Budget, many a experts were of the opinion that despite the government's efforts to curtail subsidies, its food subsidy bill may exceed the Budget estimates (for FY16) of Rs 1.24 lakh crore.