NREGA workers kept waiting for wages

A performance audit of the National Rural Employment Guarantee Act in Karnataka reveals delayed payment of wages, sometimes by three months or more, to nearly five lakh workers under the scheme during the period 2009-12. Himanshu Upadhyaya looks at the key audit findings and connects the dots.
 

 •  Write the author
•  Public funds
•  Labour
•  Karnataka
•  Send to a friend
•  Printer friendly version

18 September 2013 – The performance audit report on the implementation of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in Karnataka was tabled in the State Assembly on 30 July 2013. An earlier article reviewed several anomalies, delays and variance with what had been originally envisioned in respect of planning processes, realistic labour budget estimation, registration and issue of job cards, monitoring mechanisms, social auditing and grievance redressal.

What stands out equally starkly, if not more, from the report are the performance audit findings related to payment of wages and compensation to workers employed under the scheme. The audit notes that in 2010-11, almost half of all payments made were recorded beyond the stipulated 15-day period and while workers should have been paid compensation for such delays, no such compensation was paid.

If one wonders why and how such a sad state of affairs came about, one only needs to look at the way in which Information, Education and Communication activities to empower MGNREGA workers about their rights have been undertaken by the state.

Delayed payment of wages

MGNREGA workers are entitled to being paid on a weekly basis, and in any case within a fortnight of the date on which the work was done. In case payment of wages is not made within the period specified under the scheme, workers must receive compensation as per the provisions of the Payment of Wages Act, 1936 with the cost of such compensation being borne by the state government.

Audit scrutiny of data extracted from the MIS throws up a significant number of cases where wages were paid after a delay of more than the stipulated period of 15 days. In the year 2010-11, delayed wage payments amounted to as high as almost half the total wages paid. During the years 2009-10 and 2010-11, a very high number of muster rolls showed payments of wages with a delay of more than 91 days.

The audit observes that though wages belatedly paid as a proportion of total wages showed a decline in the year 2011-12, the percentage still remained significantly high at 23 per cent. In its reply to this audit finding, the state government has accepted its failure.

MGNREGA researchers would perhaps do well to look at MIS data for the year 2012-13 and analyse the payment of wages reported therein to verify if the state government has merely stopped at acknowledgement of its failure or if it has indeed learnt any lessons from the above audit observation.

Non-payment of unemployment allowance

The CAG’s performance review of MGNREGA implementation in Karnataka has also revealed that the state government had made no payments towards unemployment allowance. The Operational Guidelines stipulate that any person having a job card can apply for work to the Gram Panchayat in writing. On receiving such an application, which is also called ‘demand for work,’ the official shall issue a dated receipt to the applicant. In case work is not provided within 15 days from the date of demand for work, an unemployment allowance is to be paid to the applicant by the state government.


In a significant number of cases, wages were paid after a delay of more than the stipulated period of 15 days. In the year 2010-11, delayed wage payments amounted to as high as almost half the total wages paid. 


•  Six months for a job card?
•  MIS=Too many mistakes

Audit scrutiny of MIS data showed that in a majority of cases, the demand for work had been entered as the same date on which the person was engaged as MGNREGA worker as per the muster rolls, or the preceding day of the engagement of worker. This pattern of data entry in MIS, accompanied by the conspicuous absence of what I term ‘flesh and blood employment registers,’ indicate the scope for manipulating the date of demand for work.

The neat records at the MIS level in a state where a beneficiary survey has seen many workers reporting delays of up to six months in acquiring a job card itself does seem to indicate that we can’t take the MIS claims at face value.

In those relatively less number of cases, where the MIS data broke away from the pattern narrated above, the number of person-days for which unemployment allowance should have been paid to workers is as mentioned in the table below:

==================================================================
Year	Number of person-days for which unemployment allowance was payable
                In all 30 districts       In 8 test-checked districts
==================================================================

2007-'08          65,415                    5,097
2008-'09        3,12,574                1,49,840
2009-'10        1,01,952                  46,166
2010-'11        1,49,786                  49,455
2011-'12         22,493                     10,098

Total               6,52,220                2,60,656
==================================================================

However, during audit scrutiny it was found that no unemployment allowance had been paid to workers, either as per MIS data or as per records in test-checked data.

It is worth looking at what the state government says in reply to this audit observation, in its communication dated January 2013. In its reply, the state government sought to argue that as per the Operational Guidelines, the question of unemployment allowance arises only when the labourer applies for it in writing. The state government also added in its reply that the whole process of record maintenance was being computerised now, which would resolve these issues.

The CAG however pronounced that “the reply was not acceptable, as the state government, instead of educating the labourers through Information, Education and Communication (IEC) activities, had taken shelter under the ignorance of the intended beneficiaries.”

It would, therefore, be interesting to explore the amount of resources that the Karnataka government has spent from its MGNREGA budget on such IEC activities. The following is what the audit has to say on this.

Information, Education and Communication Activities under MGNREGA

Audit scrutiny revealed that the state government had not drawn up any Information, Education and Communication (IEC) plan. IEC activities were taken up in a limited manner through street plays, radio programmes, pamphlets and wall writing in public places. Towards this, the state government incurred expenditure worth Rs. 74.78 lakh during 2007 to 2012. Since June 2010, the state government has engaged consultants for IEC activities and paid them an amount of Rs 1.5 crore till March 2012.

The CAG performance review also noted that the financial management of the scheme was deficient, as monthly squaring and reconciliation of accounts at all levels was not being attempted at all. It also indicted the State Employment Guarantee Council (SEGC), Governing Council and Executive Council, stating that they failed to meet regularly. The SEGC had met only four times as of 31 March 2012, while the Governing Council had met only two times during the period 2009 to 2012 and the Executive Council had met only once since its constitution.

With a change of the guards, will things improve for MGNREGA workers in Karnataka in the year 2012-13? We will have to wait and watch, but meanwhile civil society organisations and MGNREGA researchers could go a long way by insisting that the Public Accounts Committee of the State Assembly takes up the present audit report for discussion soon.

Himanshu Upadhyaya 
18 Sep 2013

Himanshu Upadhyaya is a researcher at the Azim Premji Foundation, Bangalore.

– See more at: http://www.indiatogether.org/2013/sep/gov-wageaudit.htm#sthash.OuSwVBmF.dpuf

Farm loan waiver fraud hits AP

http://www.newindianexpress.com/states/andhra_pradesh/article1490084.ece#.Ux9DZrV5fp8

By Express News Service – HYDERABAD

Published: 06th March 2013 08:55 AM

Last Updated: 06th March 2013 08:55 AM

Andhra Pradesh has its share of the “irregularities” committed in the implementation of the Agricultural Debt Waiver and Debt Relief Scheme (ADWDRS), 2008.

The Comptroller and Auditor General, in his report submitted to Parliament on Tuesday on ADWDRS, found that, among other things, one private Scheduled Commercial Bank (name not mentioned) received reimbursement for loans which were extended to Micro Finance Institutions (MFIs) in five states, including Andhra Pradesh. The amount reimbursed was Rs 164.6 crore (for all the five states).

In AP, the total number of farmers who benefited from the scheme was 77,55,227 and the total loan waiver and relief given to them was Rs 11,353.75 crore. All over India, the total amount waived was Rs 52,000 crore and the number of beneficiaries were 3.45 crore.

This was in violation of guidelines issued by the Ministry of Finance at the time of the implementation of the scheme since it clearly stated that only agricultural loans disbursed directly to farmers were eligible for reimbursement. In 2010, the Ministry explicitly stated that agricultural loans extended to micro finance institutions by banks were not eligible under the scheme for reimbursement from the central government.

The bank, however, made a claim under the ADWDRS for certain borrowers sourced through MFIs under the partnership model in the five states.

Though the bank maintained that the loans were direct in nature, the CAG audit found that dis-aggregated data of the loan accounts sourced through MFIs was not maintained by the bank and hence these loans could not be considered as direct lending to farmers since lump sum credit arrangement facility was given to the MFIs against which the MFIs actually disbursed the loan to borrowers identified by them.

This apart, the CAG found that in AP, a sum of Rs 40.76 lakh went to ineligible beneficiaries (132 accounts) and reimbursement was made for an amount of Rs 26.55 lakh though loans had not been disbursed (96 accounts).

When contacted, state finance minister Anam Ramnarayana Reddy said that the government would initiate action if there were any irregularities in the implementation of the scheme. “The total loan waiver in our state was about Rs 12,000 crore. As regards benefiting the MFIs, we should first know how much our share is in the Rs 164 crore that was paid to the bank towards loans advanced to the MFIs. We are yet go into details,” the finance minister said.

Meanwhile, the CAG report said there was also prima facie evidence of tampering, over writing and alteration of records. The CAG noted “the monitoring of the scheme was also found to be deficient”.

It has recommended immediate corrective measures to take action like recovery of money paid to ineligible beneficiaries and loans extended to MFIs, action against bank official and auditors and filing of FIRs in cases of tampering of records, issue of debt waiver and debt relief certificates to farmers.

Jalayagnam: Rs 1,86,000 cr illusion

Author(s): M Suchitra

Date: Jul 15, 2012

Andhra Pradesh’s Jalayagnam irrigation scheme unviable, contract-driven, says CAG draft report

imageDevadula lift irrigation scheme in Warangal is the second biggest in Asia. But the state does not have enough power to operate it

In 2004 when the Andhra Pradesh government launched Jalayagnam, the mega irrigation programme was touted as a solution to the agrarian crisis in the state’s drought-prone and backward regions. It was also pitched as a programme that would bring relief to the power-starved state. But going by a draft audit report of the Comptroller and Auditor General of India (CAG), it seems Jalayagnam, launched ahead of the assembly polls that year, was an election gimmick of the then Congress government of late Y S Rajasekhara Reddy.

The state neither has enough funds nor water to implement the Rs 1,86,000-crore programme, according to the draft CAG report. Jalayagnam envisages 86 irrigation projects mainly on the Krishna, Godavari and Pennar rivers and their tributaries, and aims at providing drinking water to one-fourth of the state’s 80 million population and irrigation to more than half of the state’s rainfed areas. It assumed the importance of a dream project in the backdrop of the fact that more than half of the state’s cultivated area is rainfed. Over the years, there has been sharp increase in groundwater exploitation, especially in the Telangana and Rayalaseema regions that receive scanty rainfall.

imageBut most of the projects were taken up without carrying out feasibility studies, settling inter-state disputes or obtaining necessary clearances (see ‘Projects faltered’), says the draft CAG report. “It appears that Jalayagnam was largely driven by the urgency to award contracts rather than focusing on immediate benefits to targeted beneficiaries,” it says.

Although 12 projects are said to have been completed under Jalayagnam by January this year, they were actually ongoing projects incorporated into the programme. None of the projects were providing water to farmers when CAG prepared the report, despite claims by the government that it has created irrigation potential for 849,000 hectares. Although the government had promised to complete Jalayagnam in five years, 74 projects are still under construction; 49 of them are far from complete. This is despite the fact that the programme received Central assistance of Rs 4,015.26 crore for 22 projects.

The CAG report says the programme is weighed down by ill-planning, which could render it ineffective.

Planned on unavailable water: No comprehensive study was done on the availability of water for Jalayagnam projects. The CAG audit revealed that the water required for successful implementation of the projects on the Krishna and the Pennar is far more than the water allocated to the state (see ‘Overambitious’). The water allocated to the state is already being overdrawn by existing projects. The government planned Jalayagnam projects on the rivers saying it would utilise flood water. But then flood water is available only for a few days—around 30 days in the Krishna—in a year and cannot satisfy the projects’ demands. Several projects, for instance A V R Handri Niva Sujala Sravanthi and Jawahar Nettampadu lift irrigation Scheme on the Krishna, are technically unviable. Projects like Indira Sagar Dummugudem on the Godavari, too, do not have assured water availability, points out the report.

image

Not enough power: Thirty-one projects under Jalayagnam are lift irrigation schemes where water needs to be lifted from the rivers by use of motors and pumps, which would require about 206 million units of electricity a day. This is when the average power consumption of the state was 160.80 million units a day in 2009-10. This means even if power supply for the entire state is shut down and diverted for the lift irrigation schemes, there would still be a shortage of 44.2 million units a day. The state will thus not be able to operate the irrigation schemes, notes the report. Being a power-deficit state, Andhra Pradesh purchases power from independent power producers at high rates. Even at the minimum Rs 2.60 per unit, the total funds required for the schemes would be Rs 5,533.58 crore a year, it adds.

imageBenefits inflated to suit contractors: The benefit-cost-ratio (BCR) has been inflated for many projects, says the report. This includes Jalayagnam’s most expensive Pranhita-Chevella lift irrigation project on a tributary of the Godavari. It aims to provide water to seven districts. BCR for the project was worked out based on assumptions, not facts.

The report notes that Jalayagnam appears to be driven by awarding a large number of contracts, without any assurance on completion of works within the envisaged time and budget. The contracts were awarded to favour contractors, putting the state’s interests at risk. “In most cases, the technical sanction was obtained after the bidding, clearly pointing to the possibility of manipulation in favour of certain bidders.” Firms that were not qualified for bidding entered through back doors. CAG’s audit also revealed that parties in joint venture (JV) firms changed their partners several times to form new JVs to bag contracts. In the Pranahita-Chevella project, four firms obtained 16 contracts worth Rs 22,885 crore by forming JVs in 16 different combinations.

High on aspirations, low on funds: The state government started implementing all Jalayagnam projects simultaneously without assessing the availability of funds. As a result, the programme has put huge financial burden on the state. As of April 2011, the state incurred a liability of Rs 1,27,084 crore—87 per cent of the state’s budget for 2012-13. Besides, the government is yet to adequately compensate and rehabilitate the 131,000 families, including indigenous people and farmers, displaced by the projects.

“…the government is saddled with a huge number of projects which are nowhere near completion. The financial burden of these incomplete projects on the state exchequer will be felt for a long time to come,” notes the report. Instead of taking up 86 projects simultaneously, the government should have prioritised projects over medium to long term and focused its attention on a few projects, ensuring that adequate resources are allocated and the projects are implemented properly, observes the report.

The state irrigation department is now in the process of proposing changes in the draft report and preparing explanations to the charges raised in the report. “The draft report has made sweeping statements without going deep into ground realities,” says S K Joshi, principal secretary with the irrigation department. “CAG believes in a step-by-step process whereas the government believes in a parallel process. The government is keen to see that farmers in rainfed, drought-prone regions get irrigation facilities fast, he says. Refuting the allegations regarding inter-state disputes over Jalayagnam projects, Joshi cites the recent agreement between Andhra Pradesh and Maharashtra for Pranhita-Chevella project. He hopes the final CAG report will include the proposed changes.

CAG raises questions over Rs 50,000 crore fertilizer subsidy

The department of fertilizers could have paid out Rs50,587 cr in subsidies without due process to check fraudulent claims by companies between 2007-08 and 2009-10

http://www.livemint.com/2011/08/01000134/CAG-raises-questions-over-Rs50.html

New Delhi: In what could pose fresh problems for the United Progressive Alliance government, the department of fertilizers might have disbursed subsidy worth over Rs50,000 crore without completing mandatory procedure, the Comptroller and Auditor General of India (CAG) has said.

The department could have paid out Rs50,587 crore in subsidies without due process to check fraudulent claims by companies between 2007-08 and 2009-10, the government’s external auditor has said in a draft performance audit report submitted to the department. Mint has reviewed a copy.

The report could potentially embarrass an already embattled administration fighting charges of corruption and weak governance.

The subsidy was disbursed on account of sale of fertilizers such as diammonium phosphate (DAP) and muriate of potash.

For all non-urea fertilizers, the department typically releases subsidy in two instalments. As soon as a company notifies the government of the sale of such fertilizers, it releases 85% of the subsidy due to the company on account of its sale.

The money released on the initial claim is given out after a company fills out a form known as Proforma A.

For the remaining 15%, the company has to submit a sale verification certificate—part of what is known as Proforma B—that it obtains from the state government or Union territory where the sale has occurred.

If the company fails to provide the second form within 180 days to receiving the first one, it has to provide a bank guarantee equivalent to the money released to it, until it provides the sale verification certificate along with Proforma B.

This effectively means that the second form, along with the sale verification certificate, acts as collateral for the claim. The government instituted this system in August 2002 to ensure no companies could make fraudulent claims.

It is this due process that was not followed, CAG said.

“The status of outstanding Proforma B certificates was provided only for the period 2007-08 to 2009-10, which revealed that Proforma B certificates for concession claims amounting to Rs50,587 crore were outstanding for the period 2007-10 alone,” CAG said in its report.

Officials at the fertilizer department, however, say that state governments often failed to provide the sale verification certificates.

“We could not have simply held up the companies’ payments as they need that money to meet operational needs,” one department official said, requesting anonymity.

Also, the government has an online fertilizer monitoring system (FMS) to ensure there are no major discrepancies between the quantity of fertilizer sold and the amount of subsidy disbursed, said a second department official, who, too, declined to be named.

This was disputed by an expert.

“There have been several cases in the last two or three years where false claims have been made by companies on sale of fertilizers, and subsidy has been disbursed,” said Sudhir Panwar, a professor at University of Lucknow and a close observer of farm issues. “In addition to this, the problem of smuggling of fertilizers to neighbouring countries is rampant.”

CAG has also pointed to discrepancies in the supply of DAP during 2008-09 by Indian Potash Ltd. It says Indian Potash claimed subsidy for some 30.42 lakh tonnes of DAP.

“As per the data in the web-based FMS, the quantity received was only 28.78 lakh tonnes, leaving an unexplained shortfall of 1.64 lakh tonnes, which involved payment of concession of Rs762 crore,” the report says.

“We have already given an explanation on this to the department of fertilizers,” said P.S. Gahlaut, managing director, Indian Potash. “The discrepancy occurred because of inventory build-up and provisional sales, which were cleared later.”

In its interim report, CAG has also pointed to discrepancies in the disbursal of nearly 100,000 tonnes of urea in West Bengal, Bihar, Madhya Pradesh, Haryana, Gujarat and Jharkhand, which it says may have cost the exchequer in excess of Rs120 crore.

The fertilizer department will respond to the report in a few weeks, its officials said.

2. Govt’s Rs 2 lakh cr fertilizer project a washout: CAG http://articles.timesofindia.indiatimes.com/2011-08-06/india/29858398_1_fertilizer-subsidy-urea-domestic-production

TNN Aug 6, 2011, 01.09am IST
NEW DELHI: In a severe criticism of the government’s massive fertilizer subsidy bill, the Comptroller and Auditor General (CAG) said the huge expenditure has neither increased domestic production of fertilizers, nor made available high-quality product to Indian farmers. The government spent Rs 2, 70, 648 crore on fertilizer subsidy between 2003 and 2010, but fertilizer production increased by a meagre 14 metric tonne.

India’s fertilizer requirement rose by 70% between 1998-99 and 2008-09, but production went up by only 11%, while imports rose by 236%. Fertilizer subsidy increased from Rs 11,387 crore in 1998-99 to Rs 96,603 crore in 2008-09 (subsidies for imported fertilizers rose from 3% to 47%) which means taxpayer money was being used to pay exorbitant prices for fertilizer in the international market, while domestic production faltered.

Changes in the subsidy regime also “failed to incentivize growth in domestic production of fertilizer”. The new pricing system for urea, the CAG said in his conclusion, resulted in a shift from naphtha-based urea production to gas-based production, but failed to show any increase in either capacity or production of urea.

The CAG observed that there is almost no end-user verification of the subsidy at the states’ level, “because it did not involve physical verification of stocks or sales beyond the first point of sale” without involving verification of invoices, receipts, etc. The government auditor also raised a red flag over “irregularities” and “discrepancies” in urea imports.

The CAG indicted the government on the shocking state of quality of fertilizer testing in the country, dubbing it “grossly inadequate”. “The annual capacity of the existing quality control laboratories was only 25 per cent of the required capacity for testing…” besides, the CAG also recorded a severe shortage of physical and human infrastructure.

CAG observed that “mixing units” in many states consume subsidized fertilizers, which they described as “major flaw” in the subsidy chain — these units procure fertilizer at subsidized rates, but sell the mixtures at much higher rates.

3. Majority of farmers unaware of fertiliser MRPs: CAG http://www.thehindubusinessline.com/industry-and-economy/agri-biz/article2328416.ece?homepage=true
New Delhi, Aug. 5:
Over 56 per cent of Indian farmers are not aware about the maximum retail prices (MRP) of fertilisers they buy, while 45 per cent fork out more than the MRP and 59 per cent face problems in getting their season’s full requirement in time.

These are the startling findings of a countrywide survey of 5,498 farmers conducted by field audit teams of the Comptroller and Auditor General of India (CAG) and reported in its ‘Performance Audit of Fertiliser Subsidy’ tabled in the Parliament on Friday.

The survey, conducted during June 2009 and March 2010, reveals marked inter-State disparities with regard to pricing and availability of fertilisers at the farmer level.

Absence of awareness
The absence of awareness about MRP of fertilisers is as high as 98 per cent in Jharkhand, 97 per cent in Bihar and Assam, 96 per cent in West Bengal, 89 per cent in Madhya Pradesh, 79 per cent in Rajasthan, 68 per cent in Uttar Pradesh, 64 per cent in Kerala, 60 per cent in Jammu & Kashmir and 59 per cent in Tamil Nadu.

The levels of ignorance are somewhat lower in Chhattisgarh (35 per cent), Maharashtra and Orissa (24 per cent each), Andhra Pradesh (20 per cent), Karnataka (19 per cent) and Gujarat (17 per cent).

The awareness among farmers about MRPs is, not surprisingly, the highest in the two Green Revolution States of Punjab and Haryana. 89 per cent of farmers in Haryana and 100 per cent in Punjab knew the MRPs from the list shown to them by the CAG field audit teams.

Moreover, not a single surveyed farmer in Punjab reported buying fertilisers at above the MRP. In 99 per cent of cases, they got receipts from the dealers on their purchases.

Artificial shortages
In contrast, almost all farmers in West Bengal complained of artificial shortages created by dealers during peak seasons, forcing them to purchase fertilisers above the MRP. In Bihar, 71 per cent of farmers bought fertilisers from unregistered dealers and 99 per cent did not get any receipts.

The other significant finding of the CAG survey is the apparently lower extent of short-changing of farmers in States, where fertiliser sales take place through cooperative societies rather than private dealers.

Thus, in Orissa, 93 per cent of farmers buy from cooperative outlets and, probably as a result, only 24 per cent reported making purchases at above the MRP. A similar situation prevails in Chhattisgarh, where 65 per cent of farmers accessed fertilisers from cooperatives and 87 per cent did not pay more than the MRP.

4. Current way of assessing fertiliser requirement flawed: CAG
http://www.financialexpress.com/news/current-way-of-assessing-fertiliser-requirement-flawed-cag/828021/0

FE Bureau

New Delhi: The Comptroller and Auditor General of India (CAG) has said it is difficult to ensure that the huge fertiliser subsidy incurred by the state actually results in full availability of quality soil nutrients at the subsidised price to the farmer in a timely manner.
The auditor said in his performance audit of fertiliser subsidy, tabled in Parliament on Friday, that the Centre needs to review the steps taken to incentivise increased production of fertiliser, ensure better assessment of the requirement and go for rigorous verification of consumption at the lowest level. The sector lacks effective monitoring at all levels to ensure that the subsidy has the desired outcome, the report signed by CAG Vinod Rai has said.

The CAG has pointed out that the existing way of assessing fertiliser requirement in a year — by merely projecting a 5% to 10% increase over that of the previous season — is flawed.

These projections do not have inputs from district and lower levels, the report said. Besides, the first point of sales is being treated as consumption for the purpose of passing on the subsidy and stocks held in each state are not taken into account, the auditor said. This has led to “several instances of over-supply and under-supply at the district and lower levels,” said the CAG.

The report also criticised the “deficiencies” in quality control over subsidised fertilizers in terms of poor infrastructure as well as inadequate manpower and testing of samples….

5. Fertilisers are being smuggled across the border: CAG

http://news.in.msn.com/business/article.aspx?cp-documentid=5348304

New Delhi, Aug 6 (PTI) Fertilisers are being diverted for non-agricultural usage and also there have been instances of key farm nutrients smuggled across the border through eastern and north-eastern states, the Comptroller and Auditor General (CAG) pointed out in its latest report.

“We found several instances of diversion of fertilisers for non-agricultural purposes as well as smuggling of fertilisers in border districts in the Eastern/North-Eastern states,” CAG said in its audit report on Department of Fertilisers.
Citing example, the report said that 548 tonnes of fertilisers worth Rs 1.77 crore were seized by the Border Security Force (BSF) during January to September 2008 at India”s border in West Bengal.

Similarly, police in Chandel district of Manipur had seized 93 tonnes of fertilisers while being smuggled to Myanmar in 2008, the report pointed out.

The CAG also expressed concern over the mismatch between demand and supply at grass-root level despite huge amount of subsidy provided by the government.

“There were significant deficiencies in planning of fertiliser supplies with several instances of both over-supply and under-supply at the district and lower levels, with consequential excesses/shortages of required fertilisers at the time when the farmers needed the same,” it observed.

The apex auditor has asked the Agriculture Ministry to ensure that the seasonal fertiliser demands are assessed on scientific basis and not merely by adding a specified percentage to last year”s consumption.

It has also asked the Chemicals and Fertiliser”s Ministry to upgrade the fertiliser quality control infrastructure through setting up of new laboratories and recruitment of qualified staff.

The report said that although the fertilisers subsidy bill has increased to Rs 96,000 crore in 2008-09 from only Rs 11,000 crore in 1998-99, the production has gone up marginally from 269 lakh tonnes to 298 lakh tonnes.

During the same period, imports went up by 236 per cent.