The Comptroller & Auditor General of India said in its 2016-17 report that Telangana had no economic discipline, and had lost several crores in sand mining.
The Comptroller & Auditor General of India has stated in its 2016-17 report that Telangana had no economic discipline, and alleged that the state had lost several crores of revenue in sand mining.
The report also stated that Mission Kakatiya was complete only by 28% - the government had completed only 7,901 tanks as against its claim of completing 27,918, and that too with 10% to 100% shortfall in silt removal as against estimation and sanction, it said.
The CAG, which tabled its report in the Assembly on Thursday, mentioned that the state government had to start with allocated very meagre amounts like Rs 19.6 crores in 2014-15, Rs 56.4 crores in 2015-16 and Rs 49 crores in 2016-17, and then had not even released any of that.
It also mentioned that the GHMC had spent Rs 134 crores (99% of the sanctioned amount) during 2012-13 and Rs 141 crores (64%) during 2013-14, but under Chief Minister K Chandrashekar Rao’s regime, it failed to spend even Rs 46 crores every year in the last three years of the sanctioned Rs 144 crores.
The CAG report also mentioned that the actual revenue deficit during 2016-17 was Rs 6,778 crores but the state government had shown a surplus of Rs 1,386 crores, and that the fiscal deficit was higher by Rs 2,500 crores than shown in the budget.
It also mentioned that during the year, revenue expenditure accounted for 69% of the state's aggregate expenditure, which was in the nature of current consumption, leaving only 31% for investment in infrastructure and asset creation.
During 2016-17 the government earned a meagre return of 0.54% on its investments in statutory corporations, government companies, joint stock companies and co-operatives. These investments were funded mainly through borrowings on which the government paid interest at 7.4%.
Also, investments (at Rs. 13,075 crores) increased 10 times (by Rs. 11,747 crores) over the previous year (Rs. 1,329 crores), but the increase in return on investments was negligible at Rs. 1 crore, indicating non-performing investments.
The current level of recovery of loans was also low with a significant gap between disbursements (Rs. 3,402 crores) and recovery (Rs. 156 crores), the report said.
The maturity profile of debt as on 31 March 2017 indicated that the state needed to repay 49% of its debt, amounting to Rs. 56,388 crores, within the next 7 years. Debt repayment amount as percentage of tax revenue increased from 7.12 during 2015-16 to 32.16 during 2016-17, the report said.
The CAG pointed out that there were instances of excess expenditure or substantial savings with reference to provisions made during the year, exhibiting weakness in expenditure monitoring and control.
Excess expenditure over allocations amounting to Rs. 6,184 crores pertaining to 2014-15 and 2015-16 was yet to be regularized as of December 2017. The cases of excess expenditure over grants were serious breaches and in violation of the wish of the legislature, the CAG said. It was important that responsibility was fixed in this regard, it said.
Excessive/unnecessary/inadequate re-appropriation of funds was also observed by the CAG in its audit. Analysis showed that out of 10,060 items of re-appropriations made by the state government during 2016-17, specific reasons were not intimated in respect of 7,338 items (73%).
Several policy initiatives taken up by Government were either unfulfilled or were partially executed, primarily due to non-approval of scheme guidelines/modalities or poor project implementation, apart from non-release / short release or non-utilisation of budgeted funds. The spirit of the statutory provision was disregarded by not utilizing the funds allocated under the Scheduled Castes Sub-Plan (60%) and the Tribal Sub-Plan (57%). The CAG also observed various instances of non-observance of financial rules and procedures, and absence of financial controls.
The CAG also pointed out that there were variations in the personal deposit account balances shown in the web portal and in the ledger at the end of the year. An amount of Rs. 10,873 crores was lying in 28,087 personal deposit accounts at the end of the year. Paying interest at higher rates (7.4%) on borrowings while keeping huge amounts in PD accounts which did not bear any interest showed poor cash and financial management by the state government, the CAG said.
Detailed contingent bills were not submitted for an amount of Rs. 475 crores drawn on 3,485 abstract contingent bills. In the absence of DC bills it was not possible to ascertain whether expenditure had taken place or not, the CAG said. Un-adjustment of AC bills for long periods in violation of prescribed rules and regulations was fraught with the risk of embezzlement and corruption, it pointed out.
Omnibus Minor Head 800 continued to be operated for recording expenditure of Rs. 14,156 crores and receipts of Rs. 3,287 crores affecting transparency in financial reporting and distorting analysis of allocative priorities and quality of expenditure. This was done in several cases even where there were earmarked heads of accounts, the report said.