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Bhubaneswar: The Comptroller and Auditor General of India (CAG) has flagged shortcomings in the way Odisha government has presented its financial position citing the fresh borrowings by GoO at higher interest rates despite having a large cash balance.
The 13th Finance Commission had recommended that the States with large cash balances should make efforts to utilise their cash balances before resorting to fresh borrowings. The CAG, in its State Finances Audit Report of the Government of Odisha for the year 2017-18, mentioned that out of a General Cash Balance of Rs 25,305 crore, there was an untied cash balance of Rs 13,436.83 crore available. Despite this, an amount of Rs 12,013 crore was borrowed at interest rates ranging from 6.94 to 8.24 per cent, contrary to the Finance Commission recommendations.
Responding to government's reply that the cash balance included tied up balances, the CAG has recommended that the State government, before fresh borrowings should examine whether it is necessary to borrow funds resorting to higher interest rates when there are large cash balances available with them earning lower interest rates. The government should avoid large cash balances resulting in avoidable interest burden.
Eight major defaulting departments, including Panchayati Raj and Housing and Urban Development, accounted for 89.71 per cent of the total amount for which UCs were outstanding as of March 2018, the CAG report said.
In comparison to 2016-17, the total amount for which the UCs were pending increased by Rs 7,894 crore (25.85 per cent) in 2017-18, it said adding UCs amounting to Rs 1,044.89 crore were pending for over ten years in 22 departments as of March 2018.
Under the National Pension System (NPS), Odisha government started collecting pension contribution from the State Government employees from 2006-07, but it transferred an amount of Rs 0.01 crore to National Securities Depository Limited (NSDL) in the year 2010-11 leaving a balance of Rs 39.62 crore to be transferred to NSDL as on March 2011. As on March 31, 2018 there was a total short transfer of Rs 20.72 crore to the NSDL.
CAG recommended the State government to ensure that employees' contribution is properly collected and transferred to NSDL along with a matching contribution in a timely manner. Steps should be taken to transfer the balance amount of Rs 20.72 crore immediately to NSDL, it added.
The audit body said 16 departments had drawn 764 Abstract Contingent bills for an amount of Rs 17.63 crore from Government accounts in the financial year 2017-18 and submitted only 490 Detailed Contingent (DC) Bills for an amount Rs 3.08 crore. Thus, 274 DC bills amounting to Rs 14.55 crore were not submitted by 12 departments before the close of the financial year. Therefore, there is no assurance that the amount of Rs 14.55 crore had actually been incurred during the year for the purpose for which it was authorised by the Legislature. Non-submission of DC bills within the prescribed time is a breach of financial discipline and enhances risk of misappropriation of public money and is an unhealthy practice, mentioned CAG.
Also, there was an excess disbursement of Rs 20.52 crore over the authorization made by State Legislature under one grant during the financial year 2017-18. Excess disbursement amounting to Rs 279.08 crore in respect of four grants and one appropriation pertaining to the years 2013-14 to 2016-17 is yet to be regularised by the State Legislature. This is in violation of Article 204 of the Constitution which provides that no money shall be withdrawn from the Consolidated Fund except under appropriation made by Law by the State Legislature, revealed CAG findings.
The report also pointed out the failure of Odisha government in achieving the target under Potato Mission. "Only 23 (41.81 per cent) cold storages of the physical target of 55 cold storages, were established as of March 2018. Thus, the objective of achieving self-sufficiency in production of potatoes by 2017-18 could not be achieved.”
