Nation Current Affairs 03 Mar 2016 Erratic LPG prices: ...

Erratic LPG prices: Consumers confused

DECCAN CHRONICLE.
Published Mar 3, 2016, 3:37 am IST
Updated Mar 3, 2016, 3:37 am IST
With LPG prices falling, the subsidy amount too, has plummeted, which in turn has eased the financial burden on the government.
According to customers and LPG dealers, until 2015, the central government fixed the LPG subsidy amount for an entire financial year and it was altered only at the time of the annual budget. (Representational image)
 According to customers and LPG dealers, until 2015, the central government fixed the LPG subsidy amount for an entire financial year and it was altered only at the time of the annual budget. (Representational image)

Bengaluru: Until the introduction of the Direct Benefits Transfer (DBT) or Pahal Scheme, LPG consumers in the state received a fixed amount as subsidy. This amount was Rs 40 per kg (or Rs 568 per cylinder weighing 14.2 kg) till March 2015. The amount was shared between state owned oil firms and the government, but after a year, customers are now confused with the different subsidy amounts they are credited. According to customers, over the last few months, (after the successful launch of the PEHAL scheme) the subsidy amount is directly credited to their bank accounts, but this subsidy amount varies per month  based on the actual rate of LPG in the open market.

The issue
According to customers and LPG dealers, until 2015, the central government fixed the LPG subsidy amount for an entire financial year and it was altered only at the time of the annual budget. But for the last few months, even though the price of subsidized LPG cylinders weighing 14.2 kg has not changed, the subsidy amount credited to the customers has varied every month.

 

According to a dealer, with LPG prices falling, the subsidy amount too, has plummeted, which in turn has eased the financial burden on the government and state owned oil firms.

“For example, in the month of June 2015, the subsidy amount transferred to all customers was Rs  211 per cylinder, but this amount was just Rs 157.21 for the month of February 2016.  This means, that customers are not getting a fixed subsidy amount and the reduction in LPG prices will benefit oil firms and the government instead of consumers,” he explained.

 

“If the LPG subsidy amount had been fixed, customers would get LPG cylinders at a reduced cost. But the government has instead, kept the cylinder rate intact and is playing with the subsidy amount which is helping the government bring down the rate of subsides,” he added. Speaking to this newspaper, an officer from a state owned oil firm informed us that this is a government policy, as the subsidy amount is fixed by the Union government.  “If we did have a fixed subsidy amount per cylinder, cylinders would be bought at a cheap rate,” he concluded.

 

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Location: India, Karnataka, Bengaluru




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