A week after finance minister Pranab Mukherjee hiked the MPLADS fund from Rs 2 crore to Rs 5 crore for each MP, the comptroller and auditor general of India (CAG) tore into the way the scheme is being implemented.

Releasing its third performance audit report on MPLADS, for the period between 2004-05 and 2008-09 on Friday, the CAG pointed how many of the shortcomings pointed out earlier in 1998 and 2001 “still persist.” And these shortcomings are one too many.
Some of these are as follows:

*Though MPLADS is meant for “locally felt need for development works”, the CAG report says there is no mechanism to identify the local needs. It says: “The scheme design doesn’t ensure participation of various constituents such as resident forums, local bodies, NGOs etc in determining works responsive to locally felt needs.”

*Such is the transparency and monitoring aspect of the scheme that as of March 31, 2009, 57 percent of completed works were not even uploaded on the website of MPLADS by the district authorities.

*State level monitoring committees to review progress has not even been constituted in three states/UTs. In 14 states/UTs, committees have been constituted but never met. In the remaining 18 states/UTs, it didn’t meet annually.

*The scheme was most active during the election time, indicating that it was being used more as election sops.

*Works worth Rs 9.45 crore were executed without any recommendation from the MPs.

* MPs are not to select the implementing agency as per the guidelines. But in nine states, MPs had recommended implementing agencies for more than 8,700 works.

*In 11 states/UTs, 305 works worth Rs 8.5 crore has been abandoned or suspended, rendering the expenditure unfruitful.

*Utilization of funds with district authorities ranged from 37.4 to 52.4 percent.

*In seven states, works were sanctioned to 145 trusts/societies which were either not eligible or their eligibility not verified.

*Basic internal control records such as asset registers, works registers etc underpinning accountability were missing in a number of instances.

*The ministry of statics and programme implementation (MoSPI) has not been closing monitoring the receipt of utilization certificates and completion certificates.

* No analysis of audited account and other management information system.

There were cases of diversion and misuse of funds too. The CAG was pained to remark that the MoSPI, the administrative ministry, “should own the scheme”, meaning that it washed its hands off after releasing funds, often without any justification.

One wished our FM had read the report before hiking the funds for the MPs.