Phased dismantling of vintage allowance for urea units

new delhi: a high-powered group of ministers (gom) on fertilisers on wednesday recommended phased dismantling of vintage allowance given to urea units for better targeting of subsidy which has touched an alarming level of over rs 14,000 crore. the group, headed by planning commission deputy chairman k c pant, also favoured implementation of a long-term fertiliser policy and switch over from unit-wise subsidy mechanism to group pricing from july this year as per the recommendations of the expenditure reforms commission (erc). the gom was set up on march 8 after the union cabinet failed to work out the pricing mechanism for giving subsidy to urea producers for the seventh and eighth pricing periods (1997 to 2000 and 2000 onwards). its recommendations would now be forwarded to the cabinet for final decision. "the gom is of the view that vintage allowance should be withdrawn in a phased manner by april, 2001 retrospectively", fertilisers minister s s dhindsa told reporters, adding that the excess amount paid to fertiliser manufacturers would be recovered for which details would be worked out. the vintage allowance would cost the exchequer an additional rs 370 crore for four fertiliser units - namrup fertilisers, iffco, indo-gulf fertilisers and national fertilisers, which are now entitled for the allowance from 1997 to 2001.