BackPaddy procurement: CAG finds irregularities totalling Rs40,564 crore
CAG calls for revised procurement, milling plans, suggests govt transfer MSPs directly into farmers' accounts
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New Delhi: The Comptroller and Auditor General of India (CAG) has found alleged irregularities to the tune of ₹ 40,564 crore in procurement and milling of paddy meant for the public distribution system (PDS).
In a report tabled in Parliament on Tuesday, the CAG pointed to lapses that include payments of nearly ₹ 18,000 crore as support price to paddy farmers without authentication as also undue benefits to rice millers in the year 2013-14.
The CAG has sought the revisiting of the existing procurement and milling plans and suggested the government transfer minimum support price (MSP) directly into the accounts of farmers.
It has pointed out nine major cases of irregularities, all of which put together add up to ₹ 40,564.14 crore. In one instance, the CAG said ₹ 3,743 crore worth of benefits were passed on to millers by not including the value of by-products in the price they have to pay for milling paddy, a charge the government refuted saying the rate paid includes the value of by-products such as rice husks and rice brans.
The government said a traffic commission has been asked to study the milling cost and value of by-products and suggest a new rate by December, based on which the government will decide on revising milling charges that have not been changed since 2005.
“Delay in revising the milling charges and poor control over custody of paddy/rice resulted in not only undue gains to the rice millers but also widespread and large-scale non-delivery of paddy and rice by them," the CAG said in its report. “Despite significant increase in realisation value of by-products, milling charges have not been revised since 2005. This resulted in excess net realisation of ₹ 3,743 crore from sale of by-products by millers in Andhra Pradesh, Chhattisgarh, Telangana and Uttar Pradesh during 2009-10 to 2013-14."
In another finding, the CAG noted that a “large number of deficiencies like non-authentication of land holdings of farmers, cases of payments to farmers with doubtful identity, non-obtaining MSP certificates, non-availability of details of farmers (like bank account numbers or the name of their village) were noticed in the states of Andhra Pradesh, Haryana, Punjab, Telangana and Uttar Pradesh."
“The amount of such MSP payments made was ₹ 17,985.49 crore for which there was no assurance that farmers actually did get full MSP for their produce," the report said.
Pointing out the large-scale non-delivery of rice by millers, the CAG said it noticed several instances in some districts of Bihar, Haryana, Odisha, Punjab, Uttar Pradesh and Telangana that 1,589,000 tonnes of paddy and custom milled rice, with a total value of ₹ 7,570.78 crore, was not delivered by millers to the Food Corporation of India.
In a separate report on the working of the Indian Railways also tabled in Parliament on Tuesday, the CAG said short circuits, poor maintenance and lack of awareness were major reasons for fires breaking out on trains. It also said that automatic smoke- or fire-detection devices had not been installed in many trains. Cigarette smoking, vendors cooking at stations, people carrying inflammable articles on board trains, accumulation of empty cardboard boxes and other waste materials also aggravated the risk of fire.
The CAG report observed that though a corporate safety plan envisaged bringing down the number of accidents by 80% from 2001-02 to 2013-14, the number of accidents had actually gone up by 160% during the period.
“The fire simulation of coach design could not be put to optimum due to non-availability of testing facilities," the CAG report said.
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