Executive Summary:
This document addresses a Lok Sabha question regarding the welfare of Fair Price Shop (FPS) dealers in India. It clarifies the roles of the Central and State/UT Governments in the Targeted Public Distribution System (TPDS), particularly concerning FPS dealer commissions. It also specifies that there is no current proposal to revise the norms of Central Assistance towards FPS dealer margins. The document references the TPDS Control Order, 2015 and Food Security Assistance to State Governments Rules, 2015.
Key Points / Main Content:
* **TPDS Operation and Responsibilities:**
* The TPDS is jointly managed by the Central and State/UT Governments.
* State/UT Governments are responsible for operational aspects, including licensing, supervision, and monitoring of FPS.
* **FPS Dealer Margin:**
* State Governments are responsible for fixing FPS dealer margins, subject to periodic review.
* The actual rate of FPS dealer margin can vary from State to State.
* The Central Government's role in determining the actual rate is limited.
* **Central Government Assistance:**
* The Central Government provides assistance to States/UTs for intra-state movement, handling of food grains, and FPS dealer margins under the National Food Security Act (NFSA).
* Assistance is provided according to the Food Security Assistance to State Governments Rules, 2015, as amended.
* FPS dealer margin norms were enhanced w.e.f. April 1, 2022.
* **Revised FPS Dealer Margin Norms (w.e.f. April 1, 2022):**
* Central share in FPS dealers margin percentage increased.
* General Category States/UTs: Increased from 50% to 75%.
* Special Category States/UTs: Increased from 75% to 90%.
* Special category States include 8 States of North East including Sikkim, Himachal Pradesh, Jammu Kashmir, Ladakh, Uttarakhand, Andaman Nicobar Islands and Lakshadweep.
* **State Government Flexibility and Limits of Central Assistance:**
* State Governments can fix actual rates higher than the specified norms.
* Central assistance is limited to the rates specified in the Rules or the actual average rates for the State as a whole, at which the expenditure was actually incurred by the State Government, whichever is lower.
* **Current Proposals:**
* There is no current proposal for revision of norms of Central Assistance towards FPS dealer margins.
Impact Analysis:
* Fair Price Shop Dealers:
* Impact: Their commission rates are determined by State/UT governments, influenced by central assistance norms. The revised norms w.e.f. April 1, 2022 increased central assistance.
* Action Required: To be aware of the commission rates set by their respective State/UT governments and any changes to these rates.
* State/UT Governments:
* Impact: Responsible for setting and periodically reviewing FPS dealer margins. They receive central assistance based on specified norms and actual expenditure.
* Action Required: To fix fair price shop owner's margin, periodically review it and to adhere to central government guidelines for utilizing central assistance, ensuring it aligns with expenditure and specified norms.
* Central Government (Ministry of Consumer Affairs, Food and Public Distribution):
* Impact: Provides assistance to States/UTs for FPS dealer margins and monitors the overall TPDS.
* Action Required: Continue to provide financial assistance as per existing rules and guidelines, and monitor the implementation of TPDS by State/UT governments.
Key Entities Referenced
Ministry of Consumer Affairs, Food and Public Distribution: The Indian government ministry responsible for consumer affairs, food, and public distribution.
Lok Sabha: The lower house of the Parliament of India, where the question was raised.
Prof. Sougata Ray: Member of Parliament who raised the unstarred question No. 1643.
Shrimati Nimuben Jayantibhai Bambhaniya: Minister of State for Ministry of Consumer Affairs, Food and Public Distribution who answered the question.
Targeted Public Distribution System (TPDS): A system operated jointly by the Central and State/UT Governments for distributing food and essential items to eligible households.
Fair Price Shops (FPSs): Shops licensed by State/UT Governments to distribute essential commodities under the TPDS.
TPDS Control Order, 2015: A regulatory order that includes provisions related to Fair Price Shop owners' margin.
Food Security Assistance to State Governments Rules, 2015: Rules that provide for norms of expenditure and pattern of central sharing related to food security assistance.
GOVERNMENT OF INDIA
MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION
DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION
LOK SABHA
UNSTARRED QUESTION NO. 1643
TO BE ANSWERED ON 30TH JULY, 2025
WELFARE OF FAIR PRICE SHOP DEALERS
1643 PROF. SOUGATA RAY:
Will the Minister of CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION
be pleased to state:
(a) the details of benefits are being given to fair-price shop dealers in the country;
(b) whether the Government is aware that the commissions of various items like cereals,
sugar, edible oil, kerosene, wheat, rice to Fair Price Shop dealers are on different rates among
various States of the country;
(c) if so, the details of commissions sanctioned for various items among the States of the
country;
(d) whether the Government has any proposal to increase and make uniform such
commissions nationwide; and
(e) if so, the details thereoP
ANSWER
MINISTER OF STATE FOR MINISTRY OF CONSUMER AFFAIRS,
FOOD & PUBLIC DISTRIBUTION
(SHRIMATI NIMUBEN JAYANTIBHAI BAMBHANIYA
)
(a) to (c): The Targeted Public Distribution System (TPDS) is operated under the joint
responsibility of the Central and the State/UT Governments. The operational responsibility
including issuance of licenses to Fair Price Shops (FPSs), supervision and monitoring of the
functioning of Fair Price Shops etc., rest with the concerned State/UT Government. As per
sub-clause (7) of clause 9 of the TPDS (Control) Order, 2015, the State Government shall fix
an amount as the fair price shop owner’s margin, which shall be periodically reviewed for
ensuring sustained viability of the fair price shop operations. Therefore, the actual rate of fair
price shop dealers’ margin may very from State to State.-2-
The Central Government has limited role in determining the actual rate of fair price
shop dealers’ margin/ commission. The Central Government only provides the assistance to
States/UTs for meeting the expenditure towards intra-State movement & handling of
foodgrains and fair price shop dealers’ margin under the NFS A, in accordance with the
provisions of Food Security ( Assistance to State Governments) Rules, 2015 (as amended fbrm
time to time), which inter-alia provides for norms of expenditure and pattern of central sharing.
In order to ensure viability of Fair Price Shops, the norms of FPS Dealers margin were
enhanced w.e.f. April, 2022 as per the details given below:
Pre-revised
I
norms
Revised
*:,„':':{IIi':)IT,
Category 0 Component of FPS Central share (in
States/UTs dealers’ margin percentage)
I
(Till
01.04.2022)
31.03.2022)
B 70 90
General Category 50
o 17 21
a 143 180
Special category 75
t 17 26
+Note: Special category States include 8 States of North East including Sikkim, Himachal
Pradesh, Jammu & Kashmir, Ladakh, Uttarakhand, Andaman & Nicobar Islands and
Lakshadweep.
However, State Governments are free to fix the actual rates, which can be higher than
the norms specified in the rules. Central assistance will be limited to the rates specified in the
Rules or the actual average rates for the State as a whole, at which the expenditure was
actually incurred by the State Government, whichever is lower.
(d) & (e): At Present, no proposal for revision of norms of Central Assistance towards Fair
Price Shop dealers’ margin is under consideration of the Government.
8###