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CAG finds Rs.20.5 cr of discrepancies in farm loan waiver scheme

CAG’s report says farmers whose loans did not meet eligibility conditions benefited from the scheme
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First Published: Tue, Mar 05 2013. 01 10 PM IST
The CAG report, tabled in Parliament on Tuesday, said out of 9,334 accounts checked across nine states, 1,257 were eligible for benefits under the loan waiver scheme but were not considered by lending institutions while preparing the list of farmers eligible for it. Photo: Ramesh Pathania/Mint
The CAG report, tabled in Parliament on Tuesday, said out of 9,334 accounts checked across nine states, 1,257 were eligible for benefits under the loan waiver scheme but were not considered by lending institutions while preparing the list of farmers eligible for it. Photo: Ramesh Pathania/Mint
Updated: Wed, Mar 06 2013. 12 29 AM IST
New Delhi: The Comptroller and Auditor General (CAG) has found discrepancies amounting to Rs.20.50 crore in the farm loan waiver scheme announced in 2008, which was partly responsible for the Congress-led government’s return to power for a second term.
In a report on the implementation of the agricultural debt waiver and debt relief scheme that CAG tabled in Parliament on Tuesday, the government auditor said farmers who had taken loans for non-agricultural purposes or whose loans did not meet eligibility conditions also benefited from the scheme.
CAG said it found discrepancies involving 6,822 out of a sample of 80,229 farmers who were granted debt waiver or relief under the scheme announced by the previous United Progressive Alliance (UPA) government.
Out of these, 4,826 farmers were extended incorrect benefits—3,262 were wrongly extended Rs.13.35 crore as debt relief while 1,564 were extended less than their due benefits of Rs.1.91 crore.
The report was tabled in both houses of Parliament.
The main opposition Bharatiya Janata Party (BJP), which has taken on the government over various instances of corruption in the recent past, had alleged there was “a big scam worth Rs.10,000 crore in implementation of the scheme”.
“This is a big fraud committed on the nation and we want strict action,” BJP spokesperson Prakash Javadekar told reporters outside Parliament. “In this scheme, more than 34 lakh (3.4 million) farmers who were eligible for the waiver were not granted any concessions and 24 lakh ineligible farmers were given huge benefits of this loan waiver.”
The loan waiver scheme aimed to cover 36.9 million small and marginal farmers while another 6 million other farmers were to be allowed a one-time settlement of loans.
Although the amount appears to be small, the discrepancies could have political ramifications, said Sudhir Panwar, an agriculture activist and Lucknow University professor.
“The general impression will be damaging to Congress prospects. Besides, the farmers who were eligible but did not get the benefit also will add to their (Congress’) woes,” Panwar said.
The UPA government, in its budget for 2008-09, announced a Rs.60,000 crore debt-waiver package to bail out some 36 million small and marginal farmers ahead of the 2009 national election. The government has so far released more than Rs.52,000 crore to clear part of the dues of such farmers.
CAG also said that of 9,334 cases it checked across nine states, 1,257 farmers were eligible for benefits under the loan waiver scheme but were not considered for it by the lending institutions involved.
Also, private scheduled banks received reimbursements for loans amounting to Rs.164.6 crore extended to microfinance institutions in violation of norms for the farm loan waiver scheme, CAG said. It did not name the banks.
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First Published: Tue, Mar 05 2013. 01 10 PM IST