Guide to Pradhan Mantri Garib Kalyan Yojana

The Government of India introduced the Pradhan Mantri Garib Kalyan Yojana (PMGKY) as a part of the Taxation Laws Act 2016, to control and manage tax evasion. The scheme provided a legal means for individuals to declare their previously undeclared money, which could then be used towards welfare programs. Although the scheme was effective for a limited period, between December 2016 and March 2017, it played an essential role in facilitating the transition towards a more transparent and accountable financial system.

In 2020, the government resumed the PM Garib Kalyan Yojana to provide much-needed aid during the pandemic. The extended PMGKY scheme aimed to support low-wage earners, small businesses, and farmers during COVID-related lockdowns, highlighting the government’s commitment to ensuring the well-being of its citizens during challenging times.

Objectives of PMGKY

1. The Pradhan Mantri Garib Kalyan Yojana’s initial objective was to manage and recover black money to mitigate income inequality in the country. As part of the scheme, individuals could declare their undisclosed income without facing any legal consequences or penalties. The government offered a window where tax evaders may deposit all their unaccounted money at a 49.9% tax rate which would then be deposited in the Government Account using the PMGKY Challan (Challan No. ITNS 287).
2. In 2020, the PMGKY was extended to include a COVID-19 relief package. The objective of the extension was to provide support to the marginalized sections of society and small businesses affected by the pandemic. The government implemented various measures, including food security, insurance packages, direct transfers, and other assistance programs to achieve this goal.

The detailed composition breakdown of the PMGKY pandemic relief package is discussed below. 

Components of the PMGKY

Discussed below are the components of the PMGKY scheme – 

1. PM Garib Kalyan Anna Yojana

The Government launched a food security program to address economic disruptions caused by COVID-19. The program provided free food items to underprivileged individuals, including 5 kg of rice or wheat per person and 1 kg of pulses per household per month. This was in addition to the existing provision of 5 kg of rice or wheat for each registered individual. The scheme aimed to cover approximately two-thirds of the population, or about 800 million people.

2. Insurance Scheme for Health Workers Fighting Covid-19

The scheme offered insurance coverage to COVID-19 healthcare workers. Health workers are an ‘Umbrella Term’ that includes community health workers, retired staff, private hospital employees, contracted staff, local urban bodies, ad hoc staff, daily wage staff, and outsourced staff who were recruited by the central hospitals, states, autonomous hospitals of the central, states, and AIIMS, UTs, and INIs/hospital of the central ministries. 

Employees such as safai karamcharis, nurses, ward boys, paramedics, ASHA workers, physicians & specialists, technicians, and other health workers were also covered. In the event that a healthcare worker is involved in an accident while providing treatment to COVID-19 patients, the PMGKY scheme provides compensation of Rs. 50 lakh to be awarded to the affected family.

3. Direct Transfer Benefits

Under the PM Garib Kalyan Yojana, the following direct transfer benefits were provided –

• Under the PM Kisan Yojana, approximately 8.7 crore farmers received an early disbursement of the first instalment of Rs. 2000, which was originally scheduled for 2020-2021 but was rescheduled to April 2020.
• In order to provide assistance to small businesses, the government deposited 24% of their employees’ monthly salaries into their PF accounts. This included both the employee EPF payment, which constituted 12% of the total salaries, as well as the employer’s EPF and EPS contributions, which also amounted to 12% of the wages. The central government covered the entire cost of these contributions for a three-month period, resulting in a total contribution of 24% of the monthly wages.
• Provision of LPG cylinders to over eight crores Prime Minister Ujjwala Yojana (PMUY) recipients for three months starting April 2020.
• Starting April 1, 2020, the government increased MNREGA pay by Rs. 20, giving each employee a monthly capital benefit increase of Rs. 2,000.
• Transfer of Rs. 1,000 for three months to 3 crore poor senior citizens, aged widows and people with disabilities. 
• Around 20 crore women under PM Jan Dhan Yojana received ex-gratia of Rs. 500 for 3 months. 
• The collateral-free credit limit for women’s self-help groups (SHGs) was increased from Rs. 10 lakhs to Rs. 20 lakhs. These SHGs support around 6.85 crore households.

4. Other Measures

• In response to the pandemic, the Indian government made changes to the EPF regulations to allow for a non-refundable advance payment of either 75% of the EPF sum or three months’ worth of earnings (whichever is lower).
• The State Government was given the responsibility or assignment of using the money provided by the District Mineral Foundation (DMF) to supplement and expand the facilities for medical testing, screening, and other necessities to stop the spread of the Covid-19 pandemic treating the patients who have fallen victim to it.
• Under the Central Government Act, Welfare Fund for Building and Other Construction Workers was created to extend financial support to around 3.5 crore registered workers. 

Also Read: All you Need to Know About Atal Pension Yojana

Eligibility to Become PMGKY Beneficiary 

To benefit from the PMGKY scheme, one only needs to open a Jan Dhan account in any bank recognized by the Reserve Bank of India, present the necessary income documentation along with an application form, available at all authorized banks, and undergo document verification. After verifying the submitted documents, the authorities will consider the applicant eligible for receiving the scheme’s benefits.

Challenges of PMGKY

Despite facing some challenges, the Pradhan Mantri Kalyan Yojna aimed to extend its benefits to individuals in need across the country. While some individuals encountered difficulties with the application process or biometric authentication, the program made significant efforts to reach individuals in remote locations. Although issues with warehouse logistics and food shortages arose, the program persevered in its mission to efficiently implement relief efforts. Despite the staffing shortages and community lockdowns, the PMGKY program continued to work towards providing much-needed support to those in need.

The challenges encountered during the implementation of PMGKY have provided valuable insights for improving India’s public distribution system. As one of the largest public distribution systems in the world, the government has recognized the importance of addressing the issues highlighted by the pandemic. PMGKY’s rollout has shed light on two critical needs: the necessity for increased and improved warehouse facilities and the importance of ensuring easy access to these storage capacities. By identifying and addressing these needs, the public distribution system can better serve those in need and provide essential support during times of crisis.

Also Read: Pradhan Mantri Awas Yojana Scheme