NEW DELHI, Aug 13 � After the Administrative Reforms Commission suggested winding up of Ministry of Development of North Eastern Region (DoNER), the Public Accounts Committee (PAC) called for a review of continuance of the Non-Lapsable Central Pool of Resources (NLCPR).
In a scathing comment on the functioning of the much-sought after scheme, the PAC has detected massive delays, diversion of NLCPR funds and other irregularities following a special audit of the scheme, putting a big question mark over its fate.
The PAC headed by Dr Murli Manohar Joshi in its report to the Parliament, has remarked that given the fact that NLCPR funding constitutes only around four per cent of the total expenditure in the North Eastern Region (NER), and as the scheme has failed to achieve its intended objective of ensuring speedy development of infrastructure, the Ministry DoNER may review the further continuance of the NLCPR scheme.
The funds can still be made available to meet the same objective either through State plans or Central ministries, the PAC report said.
The committee seems to have also relied on the comments of the then Expenditure Secretary, who during his deposition had opposed the proposal in November 1997, when the fund was created through a Cabinet decision. The Secretary deposed that they were in principle in agreement not for creating a separate fund but making the funds available for different schemes and projects of the central ministry.
What influenced the PAC most though seems to be missed deadlines and cost and time overruns suffered by the NLCPR Projects. Assam and Manipur were among the worst performing States of the North-east.
The Comptroller and Auditor General�s (CAG) audit report identified that Assam and Manipur was far from satisfactory, as these two States could not complete even half of the projects that had fallen due for completion, as on October 2008. The States of Sikkim and Mizoram have performed relatively better achieving an overall completion level of 78 per cent and 72 per cent, respectively.
As on September 30, 2008, at least 959 projects costing Rs 7070.38 crore had been sanctioned from the NLCPR. However, only 435 accounting for 56 per cent involving an expenditure of Rs 1,934.49 crore had been completed within the stipulated period, as against the targeted 783 projects.
The Ministry DoNER informed the PAC that as on July last, there were 321 projects, which were incomplete constituting 28.92 per cent of the total approved projects.
The DoNER Secretary held the law and order situation, poor availability of material, machinery and manpower for the delay.
The PAC said it further noted that out of the 32 infrastructure projects including 14 bridges, 17 roads and a porter track, only 11 projects have been completed. The remaining 21 projects were lying incomplete.
The special audit also detected diversion of NLCPR funds. Audit scrutiny revealed that the Ministry DoNER diverted an amount of Rs 1,796.58 crore from NLCPR to fund other schemes resulting in incorrect utilisation and shrinkage of the Pool. According to the guidelines, the funds under the Pool are not meant to supplement the normal plan programme either of the State Governments or Union Government.
According to the audit, Ministry DoNER decided to deduct an amount of Rs 1,605.38 crore spent by the North Eastern Council (NEC) during 1998-1999 and 2001-2002 from the Pool.
Another critical aspect touched by the audit was monitoring and evaluation of the Scheme. The audit pointed out that monitoring of the schemes both at the ministry level as well as at the State level had been weak and ineffective.
A critical area touched by the PAC was release of funds to the State, which is a sore point with the North-eastern States, as well, which have been forever complaining about slow disbursements.
The PAC said that it was concerned to note that accrual under the NLCPR are much higher in comparison to annual releases from the Pool resulting in accumulation of huge surplus balance under NLCPR.