Friday, April 10, 2015

R K Misra - Gujarat Model Disrobed, CAG Flicks Fig Leaf

Time discovers truth. In India, the Comptroller and Auditor General (CAG) does this job. No wonder the Gujarat model,assiduously used by erstwhile chief minister Narendra Modi to catapult himself to the prime ministerial calling , lies in tatters after the CAG placed it’s report for the period ending March 31, 2014 on the table of the Gujarat Assembly on March 31, 2015.

The report provides a classic example of how marketing savvy politicians-in- power use all the elements of brand building – good advertising, repeat messaging, catchlines and chest thumping-to go places. The CAG has taken the government apart for financial indiscipline and  poor spending. ” The fiscal deficit increased from Rs 15,513 crores in 2009-10 to Rs 18,422 crores in 20013-14. It also pointed out the non-submission of utilization certificates of Rs 7420.40 crores bringing out the lack of monitoring by the respective departments. Modi ruled Gujarat from 2001 to mid-2014 before taking over as Prime Minister. One of the governance claims trumpeted from rooftops was the revenue surplus. See how.

The CAG has brought out that the Gujarat government ‘willfully’ showed revenue expenditure of more than Rs 1600 crores as revenue surplus in 2013-14.”The Gujarat government  wrongfully budgeted and booked  expenditure of Rs 1,462.75 crores on account of grants-in-aid and expenditure of Rs 170.75 crores on account of subsidy under the capital section instead of the revenue section.This resulted in understatement of revenue expenditure and overstatement of revenue surplus to the tune of Rs1,633.50 crores’, the report states pointing out  an increase in primary deficit from Rs 4331 crores in 2012-13 to Rs 5,090 crores in 2013-14.

The report also throws light on the performance of the Gujarat state government- run public sector undertakings.Twenty of the total  72 working  PSUs have incurred losses to the tune of Rs 1,111.85 crores while remaining have earned profits totaling 3,363.96 crores. ”A review of the latest three CAG audit reports shows that the losses were controllable with better management”. It also points out that the returns on the government investment in the PSUs has been negligible. ”In the period of the last five years,the state government invested Rs 24007 crores.the average return by way of dividend on the investment in government companies and statutory corporations was 0.31 per cent only”, it noted.

The CAG has taken the government to task for serious lapses in land revenue management and for giving away grazing land for industrial purposes  ignoring the local requirements.A performance audit on  lease of government land showed that in the case of eight districts the data in the software did not match with the data as per records.Even when the area of grazing land was not sufficient with reference to number of cattle of the area,even then grazing land was irregularly granted on lease for industrial purposes, it states.

The CAG report  also points out  that the state government  favoured Adani group owned Mundra Port and Special Economic Zone(SEZ) in land allotment in  kutch to the detriment of the environment. Land measuring 1,840 hectares and 168.42 hectares meant for  solar salt and salt washery projects respectively had been provisioned for. However the government submitted a fresh proposal seeking approval from the  ministry of environment and forests (MOEF) as a diversionary measure.No sooner was the in-principle approval granted that a  recovery  of Rs 87.97 crore was made from the user by the forest department and the land was gone!

The Modi government of  the time in Gujarat has also been singled out for the rough end of the stick for it’s inability to stem the decline in the child sex ratio in the state. In a lucid observation it says ”the state government has failed to investigate where there were 13.29 lakh less deliveries despite 70.95 lakh pregnancies registered between 2009 and 2014.Deliveries registered through e-mamta portal were only 57.66 lakhs.Of the 181 cases registered under the PCPNDT Act (diagnosing the sex of the foetus) only 48 cases were charge-sheeted with a mere six convictions.Despite Supreme Court orders that such cases should be finalized within six months,there are cases  pending since the last 12 years. According to the 2011 census there has been a decline in sex ratio at birth in 15 of the 26 districts of the state, it observed adding that the state has failed to formulate a child protection policy.

Education  comes out as another sad story.The implementation of RTE as well as other educational schemes,particularly in the tribal areas has been rated as poor by the CAG in it’s social  sector audit.”The expenditure against available funds was only 12.67 per cent in 2011-12,14.09 per cent in 2012-13 and 22.42 per cent in 2013-14. Cases of diversion of Sarva Shiksha Abhiyan (SSA) funds, a central to state sponsored ashram shaala and eklavya model schools, both state sponsored schemes was also noticed. 


Rs 89.55 crores allotted  under the Rashtriya madhyamik shiksha abhiyan as advance was wrongly shown as expenditure and incorrect figures reported to the Centre.Against a student-teacher ratio of  40:1 in primary schools there were cases of the ratio being 156:1 and in upper primary schools where the ratio should be 35:1  there were  places where it was found to be 363:1. Sixty four schools with a total strength of 5,698  students had no teachers while 874 schools had only one teacher each. 

And so it goes on…. This is the CAG certified ‘Gujarat Model’ in a nutshell.