Presenter

Hafiz Hamza
2013-IM-44

Topic of Presentation
Sasti Roti Scheme
By
Punjab Government
(2008-2010)

Presented To
Miss Rakhshanda Naveed

Introduction
Initiated by Punjab Government in 2008
Unique in its nature
This scheme was introduced by Chief
Minister of Punjab by passing a bill in
Punjab Assembly known as Sasti Roti Bill
2008

Objective
The main objective of this scheme was
Poverty alleviation
To provide subsidized bread to poor people
of the province

Contd
To achieve this purpose, subsidy was given to tandoor
owners, who were participating in this scheme, on the
purchase of flour.
Tandoor owners were bound to sell the roti at the
price of Rs. 2- each.

Contd
Under the scheme, Sasti Roti at the rate of Rs 2
of 100 gm was being provided across the Punjab
on about 12,226 enlisted Tandoors
With daily consumption of about 70,000 bags.
Subsidized atta was being provided to the
Tandoor owners at the rate of Rs 250 per bag.
(Economic Survey of Pakistan 2008-09, Chapter
13)

Rationale for Study

Since Sasti roti scheme has faced many
controversies and allegations of corruption etc, our
focus in this presentation would be on economic and
financial aspects.

Background of the Scheme

Scheme was first introduced in September 2008
and was meant only for the month of Ramadan.
But the authorities decided to continue the
scheme till June 30, 2009.
The government had earmarked Rs. 7.5 billion
to continue the subsidy on flour bags till the end
of the financial year 2008-09 for Sasti Roti and
other food items

Contd
The Punjab food department identified above
12,226 tandoors to provide subsidized flour
bags of 20 kg at the rate of Rs 250.
Under the scheme, the range of 5 to 30 bags
was fixed for each tandoor according to sale and
baking capacity

Interesting Facts
Out of the total ovens, 3,500 were registered in
Lahore.
The food department had to provide 70,000 bags
per month to these enlisted tandoors.

Districts of Punjab Receiving

Subsidy
Districts of Lahore, Sheikhupura, Okara, Kasur were
given subsidy for supply of flour to tandoors at a
cheaper rate
Districts of Gujranwala, Hafiz Abad, Jhang, Multan,
Lodhran etc. were assisted with subsidy for sasti roti
tandoors.

The Sasti Roti Authority Act 2010

This Act was passed for the establishment of the Sasti
Roti Authority in the Punjab for the provision and
distribution of sasti roti to the deserving people of the
Province

Next Presenter
Umar Ashraf
2013-IM-23

Flaws of Sasti Roti Scheme

Criticism
The major criticism on Sasti Roti Scheme was
the pilferage in subsidized wheat flour,
nepotism in grant of quota and
lack of a proper mechanism to monitor the selfclaimed, pro-poor scheme.

Contd
Being a public project, several questions need
to be answered regarding the
Mechanism
Functioning
of this scheme

Planning and Lack of Focus

The scheme was not well planned before its
launch
No proper working was being done
This scheme was not much focused so as to
meet its goals

Contd
The scheme was not well-thought out and
was started in haste
70 per cent of tandoors located in posh
areas attached with hotels and food outlets
were taken into the network by the official
concerned

Lack of Regulatory Mechanism

The government failed to outline a regulatory
mechanism
There were no policy/rules and criteria for the
issuance of quota, installation and enlistment of
tandoors and to make it pro-poor.
Nepotism was the hallmark of the scheme.

Irregular Ependiture
Sasti Roti (cheap bread) scheme of the
Punjab caused irregular expenditure of Rs.
1.06 billion from the national fund
The Punjab Food Department conducted
financial irregularities of Rs. 514.914
billion in non-budgetary and other matters
in FY2008-09

Existence of Ghost Tandoors

In Faisalabad district alone, there were 1,300 sasti roti
tandoors existed in the district
Out of which 800 bogus or non-functional tandoors
were found to be be receiving subsidy in millions.

Next Presenter
Sammak Shafaat
2013-IM-41

Sasti Roti Scheme &

Financial Crisis of Punjab
In financial year 2009-10, the finance department
allocated Rs 6 billion to provide a subsidy on wheat
flour being provided to registered ovens for Sasti
Roti.
Due to severe financial crisis, the financial year 200910 ended with an overdraft amount of Rs 21 billion.

Contd
In order to continue the Sasti Roti, the food
department accrued a loan of Rs 6.350
billion from commercial banks at an annual
interest rate of 16 per cent during financial
year 2009-10.

Contd
The finance department earmarked Rs5 billion
to provide subsidy on Sasti Roti during 201011.
But once again the finance department failed to
release the required amount and the food
department availed Rs 1.496 billion from the
commercial banks on the same interest rate to
continue Sasti Roti till November 14.

End of Sasti Roti Scheme

There were serious concerns among the
government and civil society about the
continuation of this scheme.
At the same time, worst floods of the history,
hit all parts of the country including Punjab.
Punjab government on November 14
disbanded Sasti Roti in the province.

Sasti Roti Scheme &

Provincial Budget

Distributive Effects of
Sasti Roti Scheme
The Punjab government initiated the sasti roti
scheme without taking into account the financial
conditions of the province
It focused on the urban population of the
province
The amount of subsidy given Lahore, was
higher than that of any other district during the
two fiscal years.

Contd.
The scheme of sasti roti failed because of
the distortions in the distribution of the
subsidized product intercity
There were cities and districts that were full
of rural populations, but they had not been
provided any sasti roti tandoor

Contd
This was a major fault and legislators should had
monitored the Sasti Roti scheme for proper and
real purpose.
Sasti Roti subsidy in Lahore was the highest
among the all districts of Punjab.
Ironically, the city got higher subsidy amount
than any other district of the southern Punjab, the
region virtually ignored by the governments.

Contd
According to the data, the government spent
Rs 2.373 billion subsidies on Sasti Roti
project in Lahore division during 2009-10
while it spent only Rs 218 million and Rs
295 million in D G Khan and Bahawalpur
divisions respectively.

Next Presenter
Muhammad Ahmad

2013-IM-30

Allocative Efficiency
Allocative efficiency is a condition where all the
available resources of an economy are allocated
in the best systematic way obtaining the most
consumer satisfaction from available resources.
Allocative efficiency means that our economy is
doing the best job possible of satisfying
unlimited wants and needs with limited
resources.

Contd.
Allocative efficiency occurs when there is
an optimal distribution of goods and
services, taking into account consumers
preferences

Allocative Effects of
Sasti Roti Scheme
Different figures from different sources
were found that around 50 Lacs govt was
spending on that project each day.
But they were gaining at the end nothing
permanent.

Contd
People were still committing suicides,
Parents still can't afford their childrens
education,
Most people dont find proper place for
living, and
They were deprived of basic health
facilities.

Contd.
Then what was the function and benefit of
spending such large amounts of money ????
on a scheme that was serving not only the
poor, but also rich, proportions of whom
were even greater than the needy ones
That was for sure not a better use of money.

Contd
Scheme proved to be inadequate and
inefficient in delivering its services.
As it was meant to help the Poor , the plan
was not developed accordingly
As the government bought all the wheat
from the farmers at low price, the market
was left with little or no wheat

Better Alternative of
Sasti Roti Scheme
This could be the provision of food stamp to the
deserving people.
In this way, the entire subsidy can directly go to
the public and the chances of corruption by the
flour mills or naan bai could be minimized.

Conclusion
The Punjab government initiated the sasti
roti scheme without taking into account the
financial conditions of the province
At the end, it was found out that precious
resources were wasted.
It focused on the urban population of the
province

Contd
Scheme failed to achieve its objective.
This scheme did not work as efficiently as it
was planned to do.
The government of Punjabs sasti roti
scheme proved to be inadequate and
inefficient in delivering its services

References
http://glossary.econguru.com/economic-term/distributio
n+standards
http://www.siasat.pk/forum/showthread.php?
39863-Sasti-Rotti-Project
http://tribune.com.pk/story/82936/bitter-truth
-about-sasti-roti/
http://archives.dawn.com/archives/78496