17,000 opt out of LPG subsidy scheme: saying no to sops or avoiding hassles?

Over 17,000 LPG customers out of 15.3 crore active connection holders have opted out of the subsidy scheme – Direct Benefit Transfer for LPG (DBTL).

“As on December 30, 17,714 customers belonging to all the three public sector undertakings have decided not to use the subsidy benefits on domestic LPG,” a senior executive of an oil company said.

Dismissing speculation that the ‘opting out’ was because of implementation problems at the ground level, another official said, “Customers were given an option of opting out under the scheme... The customers who have opted out are mostly those who can afford the market price...Though the number is still small, but a beginning has been made.”

Subsidised domestic LPG in Delhi is available at ₹417/cylinder, while the price of non-subsidised is revised by oil companies on a monthly basis and is linked to market rates.

This has also helped in bringing down the subsidy burden to some extent. For Indian Oil alone, the total number of customers opting out stood at 7,567 till December 30, resulting in savings of ₹4.54 crore.

Hindustan Petroleum Corporation customers who have opted out number 5,881 and those of Bharat Petroleum Corporation stood at 4,268 as on December 30.

LPG dealers, however, feel that some consumers have opted out because the process of opening a bank account was becoming cumbersome. In fact, some bank branches were seeking a minimum deposit, despite accounts being exempted from such a requirement, a Delhi-based dealer said.

Some dealers also said that since the fiscal will end on March 31, many consumers were waiting for the new financial year to adopt the scheme to get their quota of 12 subsidised cooking gas cylinders.

The modified DBTL scheme was re-launched in 54 districts in Himachal Pradesh, Punjab, Goa, Madhya Pradesh, Kerala, Karnataka, Andhra Pradesh, Telangana, Maharashtra, Puducherry and Daman & Diu – on November 15, 2014 in the first phase. It will be extended to the rest of the country on January 1, 2015, covering 622 more districts.

While officials in the Ministry for Petroleum & Natural Gas said that oil companies are prepared to roll out the scheme across the country, dealers fear that in the long term, it will be difficult to sustain it.

They argue that the Government needs to address the issue of dealers’ commission to sustain the costs. At the present commission levels of ₹44, it is difficult to maintain home delivery of cylinders, they say.

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