CAG report points out anomalies in functioning of PRIs

Source: The Hitavada      Date: 31 Jul 2017 11:50:25


 

By Rajan Raikwar,

The audit report prepared by CAG says that the Third State Finance Commission recommended that four percent of divisible fund of State Government should be devolved to PRIs. However, there was short devolution of Rs 247.78 crore to PRIs during 2015-16

Panchayati Raj institutions (PRIs) are the main focus of State Government as far as rural development is concerned. However, Comptroller and Auditor General (CAG) of India stumbled on various shortcomings in the functioning, accountability mechanism and financial reporting issues of Panchayati Raj institutions (PRIs).


The audit report prepared by CAG says that the Third State Finance Commission recommended that four percent of divisible fund of State Government should be devolved to PRIs. However, there was short devolution of Rs 247.78 crore to PRIs during 2015-16.


The funds allocated to PRIs by State Government through state budget increased from Rs 7,911.12 crore during 2011-12 to Rs 21,155.33 crore during the year 2015-16. However, PRIs could not spend the entire allocated grants and saving ranged from six percent to 30 percent during the period 2011-16 mainly due to considerable unspent balances in the revenue head.


State Government received Rs 1,463.61 crore of Fourteenth Finance Commission (14th FC) basic grant as per entitlement from Government of India in two installments of Rs 731.81 crore (July 2015) and Rs 731.80 crore (February 2016). However, State Government delayed the release of first installment grants to Gram panchayats. As a result of delays, State Government sanctioned Rs 5.17 crore as interest, which was not released to Gram panchayats along with installments as recommended by 14th Finance Commission.


Likewise, the performance audit of management of own fund by municipal corporations and municipal councils, including collection of revenue for the period 2011-12 to 2015-16, was conducted in four municipal corporations, including Dewas, Indore, Ratlam and Rewa and ten municipal councils of State. The audit report says that there was no mechanism available at State level to capture revenue resources and expenditure of urban local bodies.


The revenue raised by test checked MCs is insufficient to meet their own expenditure. The share of own revenue remained between 37 percent and 69 percent of total expenditure in test checked municipal corporations whereas in the test checked municipal councils, it remained between 24 percent and 64 percent.