Sundaram Ramaswamy
Sundaram Ramaswamy

Mar 22 2016

ICDS: The Alternatives

ICDS: The Alternatives

Anganwadi centers are key components of the Integrated Child Development Service, ICDS program, which is designed to deliver nutrition and care for pregnant women and children (new-born to 6 years of age). The programme is meant to address issues such as malnutrition, health and hygiene of expectant mothers, hand-holding them for safe delivery and counselling them on nutrition and care of their children. It is strategically one of the most important health programmes. However, in the traditional ICDS model, distributed responsibilities at every stage leads to difficulty in effective monitoring. The traditional model is riddled with weak implementation, resulting in significant leakages1 (of the order of 58% in food supplies2 and sub-standard food grains.

The CDFI team came across a novel alternative at Palghar where the Corporate Social Responsibility, CSR route has been adopted which seemed worth a second look. In our visit to four Anganwadi centres in Palghar, we found a pilot being run by a corporate sponsor which had a service provider appointed and monitored by them. The service provider buys the grain from the open market and executes the pre-mixing and distribution to the Anganwadi. The process of pre-mixing not only allows for fortification of foods, based on deficiencies at the geographic level, but also makes cooking at the Anganwadi simpler by converting the grains into ready-to-cook food items. The pre-mixes can also be customised based on the demand at the Anganwadi. The corporate sponsor adds additional funds to the service provider to ensure the quality of meals provided is nutritious.

Since all three operations of procurement, pre-mixing and delivery are controlled by a single entity, the scope of responsibility and lack of “finger-pointing” may result in a comparatively better system. Furthermore, monitoring the system becomes easier due to the single entity and incentive structure of corporate sponsor.

Apart from this, another model that may be in our opinion, worth considering is the conditional transfer model. This model helps Anganwadis to systematically capture and validate entitlements at the point of benefit delivery, which could be any entity – a kirana shop, organised retail or PDS. The expectant mother can walk into any supplier of choice, quote her beneficiary details and procure the nutritional food supplies by validating her credentials over a mobile device or a computing system designed for the purpose. Since leakage is the pain point that needs to be addressed, it is believed that conditional transfer is a very effective solution. As per the conditional transfer, the registered beneficiary receives an OTP (One Time Password) on his/her mobile which can be shown to the kirana/ration provider for receiving the benefits. The provider enters the OTP received from beneficiary on his system (a phone or tablet) and if verified the beneficiary receives the supplies. Once the supply is delivered, the account of the supplier is credited with the amount of money due against the supplies.

Reports say that the Centre spends INR 3.65 to transfer benefits worth INR 1 to a beneficiary3. Given the huge cost of benefits reaching the beneficiary, the Direct Benefit Transfer (DBT) model could be the best option to consider. In this model, the beneficiary is not given any grain or pre-mixes; rather, funds are directly transferred to the beneficiary’s account. The DBT server uses approved authentication systems like the Aadhaar card to complete the transaction with the beneficiary’s account. Once the authentication is complete, the designated amount is directly transferred to the beneficiary’s account through a DBT server. As there is no processing or transportation of grains, the underlying pilferage and leakages would also disappear from the DBT model. Nevertheless, the objective of the ICDS is to provide nutrition to the beneficiary, and the same is not guaranteed in the DBT model.

A comparison

The traditional model, where one agency procures the grain, another pre-mixes and a third distributes is, could be compared with the above alternate ones based on factors which are most important for the success of the ICDS delivery. Nutrition4 is the key factor which governs the success of the ICDS programme. The importance of reducing leakage5 and effective service delivery6 is discussed in many studies on ICDS. Ease of monitoring goes a long way in making any programme like ICDS a success. Although a rigorous analysis may be required to ascertain all the factors important for a successful ICDS, the following five factors seem a good starting point as below:

Table: A comparison of alternate systems

  Traditional Model CSR Model Conditional transfer model DBT Model
Nutrition Low High High No control7
Leakage/ Pilferage8 High Low Low None
Misuse Low Low Medium9 High
Service delivery Low High High
Ease of monitoring Low Medium High High

The comparative table shows that while some models appear slightly better than the others, no model is fool proof. The CSR model seems to be interesting; however, a lot will depend on how the pilot fares. The corporate sponsor has to evolve a method of working with the government departments to get their reimbursement, which was seen as a pain point by the sponsor involved in the Palghar pilot. Replication of this will depend on the pilot experience and the ease of executing Anganwadi programme as a CSR project as perceived by corporates.

The DBT model is lean and easy to implement, leveraging popular technologies and established electronic payment processes. However, there might be concerns that the nutrition programme is supposed to solve a social objective of ensuring nutrition and nourishment among women and children, which is not necessarily the focus of the DBT model.

The conditional transfer model may work effectively. The key to its success, however, will be establishing a process to enable the points of delivery to adopt technology and follow the fool-proof processes designed to impose conditionality for every transaction at the point of service-delivery. The constraints may be unique to specific geographies; however, ICDS can adopt customized models and achieve these objectives by adopting a flexible set of technologies with rigid compliance norms.

 The beneficiary may use the transferred fund any personal use and may remain malnourished.

Pilferage refers to unavailability of benefits to beneficiary. It does not include misuse.

Possible if provider and beneficiary collude.

To read the full paper, please click here

7The beneficiary may use the transferred fund any personal use and may remain malnourished.
8Pilferage refers to unavailability of benefits to beneficiary. It does not include misuse.
9Possible if provider and beneficiary collude.

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