The Bill "will empower the states to distribute resources of the State to deserving people and save the resources that undeserving people get," the Minister said while replying to short debate on the Aadhaar (Target Delivery of Financial and Other Subsidies, Benefits and Services) Bill, 2016'.

"The effect is going to be on the Centre and state governments which will save thousands of crore," Jaitley said just before the measure was adopted by a voice vote.

Moving the bill for consideration and passage earlier, Jaitley said targeted subsidy through Aadhar cards of LPG consumers had resulted in savings of over Rs 15000 crore at the Centre. Four states which had started PDS delivery by a similar exercise on a pilot basis, had saved more than Rs 2300 crore.

Last week, Parliamentary Affairs Minister M Venkaiah Naidu had said the passage of the Bill would save Rs 20,000 crore by avoiding subsidies taken by the undeserving. The Bill provides for statutory backing to Aadhaar scheme for transferring government subsidies and benefits.

It provides for "good governance, efficient, transparent and targeted delivery of subsidies, benefits and services, the expenditure for which is incurred from the Consolidated Fund of India, to individuals residing in India through assigning of unique identity numbers to such individuals", a summary of the bill said.

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Giving statutory backing to Aadhaar will enable the use of the identification number for better targeting of subsidies. Jaitley said discussion on the institution of Aadhar has been going on for over seven years after the then UPA government approved a bill in September, 2010 and introduced it in Parliament that December.

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