A performance audit of Madhya Pradesh Assembly Constituency Area Development Scheme by the Comptroller and Auditor General of India, covering the period 2005-10, shows that a large number of works were lying incomplete, asset registers were not maintained, details of completed works transferred to the concerned departments or agencies were not available, inspections of works were not carried out regularly and monitoring was inadequate.
The state government had introduced the Madhya Pradesh Assembly Constituency Area Development Scheme (MPACADS) in July 1994 under which development works were to be taken up in each Assembly constituency. At the state level, commissioner of economic and statistics is responsible for implementing and monitoring the scheme and the district planning officers (DPOs) are the nodal officers. As per Rule 284 of the Madhya Pradesh Treasury Code, funds should not be drawn from the treasury unless required for immediate disbursement. In a test case, the CAG found that a district planning officer had even deposited money meant to be spent under MPACADS in the personal deposit account (PDA) to avoid lapse of budget.
The CAG has also pointed out that the Madhya Pradesh government’s expenditure pattern in the education and health sectors needs correction. The priority given to expenditure on the education and health sectors in Madhya Pradesh was not adequate in both the years 2005-06 and 2009-10 as their ratios to Aggregate Expenditure (AE) were lower than the General Category States’ average. Greater fiscal priority may be given to these sectors as other general category states are spending a greater proportion of the aggregate expenditure on these heads than MP, the CAG has emphasised.
The Madhya Pradesh government has enacted the Fiscal Responsibilities and Budget Management Act (FRBM Act) and laid down the reform agenda through a fiscal correction path but, according to the CAG, funds flowing directly to state implementing agencies through the off-budget routine inhibits FRBM requirements of transparency and therefore bypasses accountability. A system has to be put in place to ensure proper accounting and accountability of Government of India funds that are transferred directly to state implementing agencies.
CAG has also concluded that slow progress in implementation of various social and developmental programmes in the state left an overall saving of `11,930 crore. Rush of expenditure at the end of the financial year was another chronic feature noticed in the State. In many cases, the anticipated savings were either not surrendered or surrendered on the last two days of the year, leaving no scope for utilizing these funds for other developmental purposes.