The government is pushing ahead with its 'aam aadmi' campaign with the President I promising a National Food Security Act. Providing food to the poor is inherent to effectively combating poverty and, therefore, I feel the intention of the government is laudable. However, there are some basic questions that need to be answered. What are the financial implications? How can the programme be made effective? How can it be ensured that it will terminate at some date? Let's take a closer look. As the President said, "Every family below the poverty line in rural as well as urban areas will be entitled, by law, to 2 5 kg of rice or wheat per month at Rs 3 per kg." At present, the Centre provides 35 kg of rice or wheat per month to the four crore bpl families. Wheat is supplied at Rs4.15 per kg while rice at Rs 5.65 a kg. Thus, around 20.6 million tonnes (mt) of grains are distributed to bpl households. With a smaller amount of 2 5 kg, the total distribution will be only 12 mt. However, the number of persons below the poverty line is being re-calculated by an expert committee constituted by the Planning Commission. It is generally believed that the existing figure for bpl families in rural areas is an underestimate. If we take the data on malnutrition as an indicator, the head count ratio of poverty could be around 40 per cent in rural areas and around 2 5 per cent in urban centres. In this case the number of bpl families could double to eight crore. The amount of grain to be distributed would be 24 million tonnes. It still means that the Centre has enough food grain in its buffer stock to implement this law. On the back of higher minimum support prices, the government has procured a record 24 mt of wheat and nearly 30 mt of rice till the middle of June 2009. The amount of subsidy required would depend on the price at which government procures wheat and rice. The present Minimum Support Prices for wheat and rice are on an average Rs 10.6 per kg. The subsidy burden thus comes to Rs 7.60 per kg. The cost of distributing 24 mt at Rs 3 per kg would be Rs 18,240 crore. This is some what larger than the present cost of giving 20.6 mt at Rs 4.90 per kg of Rs 13,800 crore but is manageable. The critical question, then, is how to minimise leakages to ensure that the deserving get their full entitlements. The solution could be in giving a unique id card to everyone for an effective and better targeted distribution system. A bpl family can bu-v subsidised food grains from any shop, including ration shops with its smart card. The shopkeeper collects Rs 3 per kg from the cardholder and if the sale price is Rs 13, the difference of Rs 10 per kg is transferred from the government account to the trader's account. This scheme would require that the government estimates market prices of wheat and rice and announces the per kg subsidies that traders would be entitled to every season. The big task would be in ensuring that the scheme winds down as the number of bpl families goes down. An effective system of periodic identification of bpl families needs to be initiated. This is not easy, but one can think of certain disqualification criteria