The Insurance Scam under PMFBY: FM Arun Jaitley must explain his claim on arrear claims
The AIKS consider the 2016 crop insurance scam as a very serious issue of corruption. The Prime Minister Fasal Bima Yojana was announced as the flagship programme of the NDA government on 13th January 2016. The premium income amount collected by insurance companies for 2016-17 is Rs. 21,500 crore. However only Rs.714.14 crore ie. 3.31% of the premium income collected had been disbursed till 7th April, 2017 against the claim for payment of Rs.4270.55 crore in Kharif 2016. The corporate houses have siphoned the remaining around 97% of the premium income amount of Rs 21,500 crore.
The claim in Kharif 2016 is below 20 % of the premium income. The premium income to the insurance companies in the year 2016-17 in the PMFBY had been 400 % more comparing to Rs. 5,700 crore during 2015-16 in the earlier crop insurance schemes.
The number of farmers covered under various Crop Insurance Schemes during the last three years was 332.35 lakh in 2013-14, 370.32 lakh in 2014-15 and 407.45 lakh in 2015-16. In 2016-17 the number is 562.96 lakh. Though the premium amount collected in the year 2016-17 was increased by an inflated 400%, the number of farmers covered was increased only by 38%.
It shows there is an extraordinary leap in the allotment which is not reflected in the coverage. Regarding this, the Para 24 of the 2017-18 budget speech of the Finance Minister Arun Jaitley on 3rd February 2017 says as follows-
“at the time of sowing, farmers should feel secure against natural calamities. The Fasal Bima Yojana launched by our government is a major step in this direction. The coverage of this scheme will be increased from 30% of the cropped area in 2016-17 to 40% in 2017-18 and 50% in 2018-19. The budget provision of Rs 5,500 crores for this Yojana in BE 2016-17 was increased to Rs 13240 crores in RE 2016-17 to settle the arrear claims. For 2017-18, I have provided a sum of Rs.9, 000 crores. The sum insured under this Yojana has more than doubled from Rs 69,000 crores in kharif 2015 to Rs 1, 41,625 crores in kharif 2016”.
However, the unstarred question NO.4026 in Rajya Sabha answered on 7th April 2017 by Purushottam Rupala, the Minister of State in the Ministry of Agriculture and Farmers Welfare has stated that the claim for payment in Kharif 2016 is only Rs.4270.55 crore which is even below the budget provision of Rs 5,500 crores in BE 2016-17 .
In this context, the AIKS demands the Finance Minister explain to the farmers and the public as to where are the arrear claims settled as he claimed in the budget speech.
The statement of the State Minister of Agriculture and Farmers Welfare has exposed the Finance Minister’s claim. Arun Jaitley willfully has misled the entire country in the name of settlement of the arrear claims under PMFBY and consciously allocated exorbitant allocation as premium income to insurance companies. This is a naked appropriation of public fund by private monopolies and this cannot be tolerated by the people of the country.
The empanelled insurance companies under PMFBY include ICICI-Lombard, HDFC-ERGO, IFFCO-Tokio , Cholamandalam MS, Bajaj Alliance, Reliance, Future General India, TATA-AIG, SBI and Universal Sompo. While launching the Prime Minister fasal Bima Yojana, the All India Kisan Sabha had expressed its strong resentment that it is imperative that Public Sector Insurance companies must be engaged in the task with substantial support of central Government and State Governments. Complaints that the private companies are defaulting in making payment to farmers although they are collecting high premium and government also paying them as well as defrauding of farmers have been common.
The Annual Union Budget is passed by the Parliament. The Government has no authority to allocate public resources according to its whims and fancies. The arbitrary action of the Finance minister of providing premium income to the tune of 400% more than the previous year when the number of farmers covered was increased by mere 38% only than the previous year is an act of corruption. Willful allocation of public resources to facilitate profiteering for private insurance companies’ amounts to corruption, favoritism and politically motivated distribution of financial and material inducements, benefits, advantages and spoils.
Sd/-
Amra Ram, President
Hannan Mollah, General Secretary
New Delhi
May 22, 2017
