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CAG finds lapses in use of special grants

Last Updated 06 June 2013, 20:25 IST

The Comptroller and Auditor General of India (CAG) has found irregularities in utilising the chief minister’s special grant of Rs 100 crore to each of the seven city corporations, excluding the Bruhat Bengaluru Mahanagara Palike, during 2008-12.

In its report on local bodies for the year ended March 2012 tabled in the Legislative Assembly on Thursday, the national auditor has rapped the State government for its failure to ensure proper implementation of works under the special grant. “The action plans failed to provide a structured and integrated programme of activity. Only road works dominated the action plans and the need analysis failed to factor in all-round development of the cities,” it stated.

The CAG conducted the performance audit of the utilisation of the special annual grant released to seven corporations. The city corporations of Bellary, Hubli-Dharwad and Davangere were selected using simple random sampling method.

Though the special grant was aimed at overall infrastructure development of these cities and thereby decongesting Bangalore, the CAG has found that about 68 per cent of the funds was spent on roads alone. Besides, construction and improvement of parks and village roads were executed at a cost of Rs 16.65 crore though there was no provision for it under the special grant.

The CAG further said the tendering process lacked transparency and contracts had been awarded to ineligible agencies. For instance, in Bellary City Corporation the condition for participating in the tender was modified at the request of a contractor by issuing a corrigendum in 2009.

Similarly, single tenders received in the first call for 34 different works of Rs 14.61 crore were accepted though the Karnataka Transparency in Public Procurement Act stipulates that fresh tenders have to be called when less than three tenders are received.

The CAG has noticed irregularities in selecting a third-party consultancy to monitor the works. The Bellary City Corporation appointed Indian Register of Shipping as third-party consultant though it failed to fulfil the qualifying condition.

Besides, the audit of water quality component under National Rural Drinking Water Programme has revealed that the planning was deficient as the annual plans were approved after much delays.

The Rural Development and Panchayat Raj (RDPR) department did not conduct proper survey of quality-affected habitation and hence, the data cannot be relied upon, the report stated.

The RDPR has failed to utilise even 20 per cent of the available funds under water quality component during 2008-12. For instance, against the availability of Rs 1,186 crore in 2011-13, only about Rs 119 crore was utilised (about 10 per cent.)

“The pace of coverage and completion of projects did not indicate that all the habitations would have access to safe drinking water anytime in near future. Monitoring of activities under the programme at different levels was also not adequate,” the report stated.

Charge sheet

* Belgaum City Corporation (BCC) made irregular payment on inert waste as tipping fees
* Non-collection of solid waste management cess by BCC resulted in loss of Rs 7.17 crore
* Gulbarga City Corporation incurred wasteful expenditure of Rs 1.05 crore under Urban Ashraya Housing scheme
* Fictitious recordings in measurement book in M’lore City Corporation resulted in the payment of Rs 90 lakh to contractor before completion of work
* Failure of Shimoga CMC to deduct income tax at source resulted in undue benefits to contractors

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(Published 06 June 2013, 20:25 IST)

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