Was subsidy of essential commodities increased to 35% as minister claims or shrunk from 75%?

GR Anil. Photo: Manorama

Thiruvananthapuram: The 10th session of the 15th Kerala Legislative Assembly came to an end with the Opposition UDF disrupting proceedings over Supplyco's decision to revise the subsidy of essential commodities keeping the House in the dark. "The Cabinet has decided to increase the prices of 13 essential commodities. The subsidy has been decreased to 35 per cent from 75 per cent. It is an insult to the House that such a decision was taken in the Cabinet by keeping the House in the dark. The decision should have been first declared inside the Assembly," Opposition Leader V D Satheesan said.

Civil Supplies minister G R Anil began by saying that the Opposition Leader's remarks were not factual. He said the subsidy has in fact been raised to 35 per cent from 25 per cent. 

Still, as the minister's clarification progressed, it became clear that the government had indeed brought down the subsidy amount as alleged by the Opposition Leader.

Since 2014, the prices of essential commodities sold through Supplyco outlets have been fixed. Then the objective was to provide these commodities at a price 26 per cent lower than open market prices. However, over time the difference between the Supplyco rates and market prices widened. "In certain cases, chilly for instance, the difference swelled to 70 per cent," Anil said.

Supplyco
Supplyco Representative image. Photo: Manorama Online.

So when the minister said the subsidy had actually been increased from 25 per cent to 35 per cent, he meant that when the subsidy amount was decided in 2014, the purpose was to keep the prices of essential commodities 26 per cent below the open market prices.

In 2016, the first Pinarayi ministry decided to freeze prices at 2014 levels. Result: Even when open market prices soared, the prices of essential commodities remained fixed. Currently, Supplyco's annual subsidy liability works out to Rs 425 crore.

Now, considering the financial burden of Supplyco, the LDF government has revised its price policy. The latest decision is to keep the benefit fixed at 35 per cent for all these 13 essential commodities. Therefore, from now on, the prices of essential commodities purchased from Supplyco will fluctuate as market rates vary. 

According to the minister, even at this rate, a consumer who buys all 13 items from Supplyco outlets would still have a gain of Rs 506. In the open market, at today's rates, a consumer would have to shell out Rs 1,446 to buy these 13 items. From Supplyco, they will together cost Rs 940.

supplyco-onam-kit-big
Representational Image. Shutterstock/Santhosh Varghese

The 13 items are Jaya rice, Kuruva rice, Matta rice, raw rice, sugar, coconut oil, red chilli, coriander, green gram, black gram, chickpea, red cowpeas, and tur dal.

Earlier in the day, Speaker A N Shamseer refused permission to the Opposition to even table an adjournment motion on the alleged protective net thrown around Chief Minister Pinarayi Vijayan's gunmen who had roughed up Youth Congress workers during the Nava Kerala Sadas in Alappuzha. The motion was moved by Congress MLA and former Youth Congress president Shafi Parambil.

Rejecting the motion, the Speaker said the issue does not meet one of the conditions that have to be satisfied to move an adjournment motion: recent occurrence. 

Satheesan objected. "Sir, this is a recent occurrence," he told the Speaker. "The police have registered a case after the Magistrate court asked them to do so. But even after the case was registered, the gunmen who stand on the right and left of the Chief Minister have not appeared before the police nor are they cooperating with the case," Satheesan said.

Before he could complete it, the Speaker cut him short. He was not even allowed to make a walk-out speech. However, the Opposition disrupted the House over the subsidy issue.

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