HYDERABAD: A five-fold hike in social security pension for people below the poverty line is set to push Andhra Pradesh into a debt trap as the freebie will become the biggest welfare scheme overtaking free power and subsidized rice schemes.
Tax-payers in AP will have to cough up an additional Rs 5,000 crore per year so that chief minister Chandrababu Naidu can deliver on his poll promise. Naidu had announced a hike in social security pension from Rs 200 to Rs 1,000 per head per month after being sworn in as the first CM of AP on June 8. He said the scheme will be implemented from October 2.
At present, there are 44,41,795 people in AP who are availing social security pension of Rs 200 per month. Out of this, old-age pensioners are 25,56,226, weavers 85,748, disabled 4,97,056 and widow pensioners are 10,45,749. Apart from these, pension is also being distributed to toddy tappers and self-help group women under the Abhayahastam scheme.
The existing pension of Rs 200 per month itself is costing the government more than Rs 1,100 crore a year. Subsidy for free power has been the biggest freebie till now. But once the pension scheme is implemented from October, it will become the number one welfare scheme, followed by free power for which Rs 2,200 crore is being spent annually and the subsidized rice scheme for which the state is spending Rs 1,200 crore per year.