Punjab farmers to get free power again

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Old 04-Nov-2010
Punjab farmers to get free power again

Chandigarh November 4:

The Punjab Cabinet today went all out to appease the agrarian vote bank of the Shiromani Akali Dal (SAD) by restoring free power to farmers.

This would end the practice of giving a “productivity bonus” to farmers who paid their electricity bills regularly. The decision was taken in the cabinet meeting today evening after much debate, even though the issue was not on the agenda of the meeting. Restoring free power to the farmers would take the state back to the annual liability of around Rs 3,000 crore as subsidy on power in one year.

The Deputy Chief Minister Sukhbir Badal was of the opinion that the SAD-BJP alliance must restore free power as the system of payment of “productivity bonus” as reimbursement, was not working out well. In some places up to 80 per cent of power bills could not be paid due to procedural hurdles.

The move of the cabinet is being interpreted politically as a step to reassure the agrarian vote bank that despite differences within the party and the ruling alliance, the SAD was committed to continuation of subsidies. It is also being viewed as a direct attempt to counter the anti-freebie tirade raised by former finance minister Manpreet Badal.

The payment of productivity bonus to the farmers who paid their electricity bills was announced by the Sukhbir-Kalia Committee Report and was implemented earlier this year. Despite opposition from various forums to completely abolish free power, the SAD-BJP government had found “productivity bonus” as a via media to reimburse the farmers, while meeting the requirements for the unbundling process of the former Punjab State Electricity Board. During the year 2009-10, the power subsidy bill to the farm sector in Punjab was Rs 2805 crore.

After the levying a nominal Rs 50 per BHP, the subsidy would have come down to Rs 2700 crore for the year 2010-11. As most farmers were unhappy with the “productivity bonus”, Sukhbir Badal mooted the proposal aimed at pleasing the farming community. The farmers who have already paid their electricity bills would not be deprived of their productivity bonus and would be reimbursed the same. The cabinet also reiterated its commitment to pay state bonus on paddy during the drought year 2009 amounting to Rs 300 crore in two instalments.

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