CAG AUDIT INTERIM REPORT:
NREGA Being Mocked in Spirit?
The NREGA 2005 is the one piece of legislation on which the UPA's claim of 'human face' governance rests. February 2, 2008, will mark two years since the implementation of the NREGS in 200 districts. Since then, an additional 130 districts were notified in May 2007; and Rahul Gandhi's 'coronation' as Congress General Secretary was marked by his announcement of NREGS' extension to the entire country.
Right from the start, the CPI(ML) and AIALA have closely monitored the implementation of the NREGS. Time and again, AIALA has confronted Central and State governments with its grassroots experiences, revealing the wholesale violations, irregularities and corruption in its implementation in state after state. Every step of the way, the rural poor had to wage fierce battles against the denial of job cards, of work, of minimum wages, of women's rights, in blatant defiance of the already circumscribed rights 'guaranteed' by the Act.
The CAG's interim Draft Performance Audit report of the first year of NREGS' implementation has recently been circulated to various state governments; while this has not yet been made public, its contents have come to be known through the media. The Audit's findings vindicate the AIALA's own experience to a very large extent, is testimony to the sheer lack of political will of the state governments of every hue towards the question of employment, wages and rights of the rural poor. Now, the UPA Government is playing down the implications of the CAG report, by claiming that the NREGS is "already a big success, and will be a huge success", and passing the buck for implementation to the States rather than the Centre. Meanwhile sections of the corporate media and have taken the CAG findings as an opportunity to trash the very concept of employment guarantee for the rural poor.
The CAG Report is a voice from the horse's own mouth, from the establishment itself, that even the most well-intentioned observer cannot but deny the rampant corruption, the irregularities, the widespread subversion of the Act; exceptions exist, no doubt, but the credit for the exceptions invariably goes to militant mass struggles of the rural poor. For the most part, the NREGS has remained an illusory showpiece for the UPA regime and the ruling classes; whatever implementation of the Act has taken place has been wrested from reluctant and apathetic governments.
AIALA's experience is that the CAG findings cannot be dismissed as mere teething troubles of the first year; the irregularities, violations, and major leakages have continued in the second year. The reluctance of governments to sincerely implement the Act reflects the fear of mobilization and organization of the rural proletariat and poor, and bodes ill for the extension of the coverage of the Act to the entire country.
Liberation summarizes some of the main findings of the CAG report below.
The scope of audit was restricted to the initial 200 districts identified for implementation of NREGA, and the period of audit coverage was from February 2006 to March 2007. Records relating to 68 districts, 128 blocks within the selected districts, and 513 Gram Panchayats (GPs) in the selected blocks were selected for detailed examination.
The total financial assistance provided by the GoI to all the State Governments up to 31 March 2007 was Rs. 12073.56 crore. Of this, the State Governments could utilize Rs. 8823.36 crore (73.08 per cent).
Delay and Violations in Preparatory Steps: The State Government of Karnataka had delayed the issuing of notification of the REGS by 14 months. The State Governments of 14 States did not formulate rules pertinent to the implementation of the Scheme, in consonance with the Act; 15 states did not prescribe the time frame for each level i.e. GP, Block and District levels for proposing, scrutinising and approving REGS works; 8 states did not designate any officer as State Rural Employment Guarantee Commissioner; 4 States had not constituted State Employment Guarantee Councils (SEGCs).
Even in the case of states which had constituted SEGCs, common observations were that many had not prepared the list of preferred works to be implemented under the Scheme; had not prepared Annual Reports for submission to the State Legislature; were constituted without non-official members; neither reviewed the monitoring and redressal mechanism of NREGA nor monitored the implementation of NREGA; or fixed no periodicity of meeting or conducted no district wise studies.
NREGS Starved of Administrative and Technical Support: The State Governments of 19 States did not appoint a full-time dedicated Programme Officer in 89 blocks; existing Block Development Offices (BDOs) were appointed as Programme Officers and given the additional charge of the Scheme. Similar was the failure to appoint Administrative Assistants, Technical Assistants, dedicated Gram Rozgar Sevaks; the failure to constitute any panel of Accredited Engineers for the purpose of assisting with the estimation and measurement of work; failure to set up a Technical Resource Support Group at State/ District level.
The CAG Audit observes that such a failure "Considering the fact the average block in the 200 districts in NREGA Phase-I has 20 GPs and 56 villages, non-appointment of a full-time dedicated Programme Officers (PO), who is pivotal to the successful implementation of NREGA, and giving the additional charge of PO to BDOs, who were responsible for other developmental schemes at the Block level, strikes at the root of effective implementation of NREGA…. The absence of Gram Rozgar Sewaks severely affected the maintenance of basic records at the GP level, without which it would be impossible to verify employment demand and allocation for each household. Also, the potential REGS beneficiaries do not have any one at the GP level to contact about their demand for employment."
Violation of Democracy and Transparency in Planning: Under NREGA, the GPs are directed to convene yearly, well-publicised meetings of the Gram Sabha with maximum participation to estimate the demand for labour, and to propose the number and priority of works to be taken up in the next financial year.
The Audit found that a documented annual plan was not prepared by 168 GPs in 14 States; Gram Sabha meetings were not widely publicized before hand in 283 GPs in 21 states; works were not identified by the Gram Sabhas in 91 GPs in 12 states; District Plans in 8 Districts in 7 States did not comprise a block-wise shelf of projects; District Plans in 46 Districts in 22 States did not indicate the timeframe for each project.
In Orissa and Jammu & Kashmir, participation in the GS meetings was poor – 2.3 per cent in 14 GPs in Orissa, and 1-2 per cent in 10 GPs in Jammu & Kashmir; in Rajasthan, Annual Plans were not linked with DPPs, and approval of Gram Sabhas was not taken/on record for the works executed; in Maharashtra, no estimate was made of the demand for labour; in Jharkhand, in Hazaribagh district, the Annual Plan was not prepared GP-wise and it did not specify the works to be taken up, the mandays to be generated, prioritization of works etc; in Ranchi district, the Annual Plan provided for only 2209 works, whereas 5918 works were taken up; in Bihar, 242 works in block Mohanpur during 2006-07 valued at Rs 8.72 crore were executed without inclusion in the AP. Annual plans prepared for NREGS in all test checked GPs were heavily loaded towards construction of brick soling roads, resulting in high material-labour ratio.
The Audit considers the impact of the above: "In the absence of documented Annual Plans, there would be no shelf of projects for timely approval, thus adversely affecting the ability to meet demand for employment. Lack of participation, or inadequate participation by Gram Sabhas, and Gram Panchayats in the planning process would vitiate the process of people’s participation, transparency and accountability, and also adversely affect the creation of productive assets benefiting the local community. In the absence of specification of physical assets and enduring outcomes in the District Annual Plans, no meaningful comparison of actual achievements vis-à-vis plans is possible."
Failure to Ensure Registration and Issue of Job Cards:
The introductory Gram Sabha meeting at the time of commencement of the Act was not convened in 119 GPs in 12 States; door-to-door survey to identify persons willing to register was not conducted in 290 GPs in 19 States; job cards were not issued to all registered households in 74 GPs in 11 States; job cards were not issued within 15 days of application for registration in 162 GPs in 15 States; photographs were not attached to job cards in 220 GPs in 13 States.
In Orissa, 670 households of 16 GPs of Narla Block of Kalahandi District were not registered, despite submitting applications, on the grounds that their names did not feature in the 2002 BPL survey list. One village (Kajumaska) of Santapur with a population of 90 (SC-11; ST-79) was not covered for registration of households.
Other instances from various states abound.
The Audit concludes, "The non-conduct of an introductory Gram Sabha as well as a door-to-door survey adversely affects the number of rural household registrations, and consequently demand for employment; if BPL surveys are reliable, then the number of registered householders should at least equal the number of BPL households, and a substantial shortfall would indicate poor publicity and slackness in implementation of NREGA…The absence of photographs weakens controls on allocation of employment and payment of wages to intended beneficiaries."
Norms for Works Violated: The audit notes that low wage areas were not identified in 53 Districts in 22 States; unique identity numbers were not allotted to works in 297 GPs in 21 States; in 15 Districts in 6 States, the wages-material ratio of 60:40 was not maintained; 35 test-checked blocks in 10 States did not maintain a wage-material ratio of 60:40; administrative approval and technical sanction of works was not obtained in advance in 96 GPs in 12 States; worksite facilities were not provided in 202 GPs in 15 States.
Some of the State-specific instances mentioned in the Audit regarding works: In Bihar, 37 works costing Rs. 2.02 crore were abandoned in Supaul after expenditure of Rs. 27.79 lakh, as they exceeded the stipulated material-labour ratio, resulting in unfruitful expenditure. …Works of Rs 1.49 crore under scheme were assigned (June 2006) to two NGOs, who had not executed the SGRY works amounting to Rs 46.22 lakh earlier allotted to them. The DDC, Darbhanga transferred Rs 2.69 crore to special division, Darbhanga during 2006-07 for construction of 34 protection walls of raised platforms constructed under Sam Vikas Yojana. Works valued Rs 1.76 lakh was shown as completed in Bahadurpur block before issue of work order. In Muzaffarpur district, despite availability of funds of Rs 11.12 lakh, no work was undertaken for the period 2006-07 leaving the entire allotted funds unutilized.
In Haryana, in Sirsa District, while the material consumed in the district from April 2006 to February 2007 for pucca works was Rs. 3.87 crore, expenditure on purchase of stores in March 2007 alone was Rs. 3.61 crore. Also, the cash books of 3 blocks of the district for 2006-07 had not been closed as of June 2007, as transactions relating to the purchase of the material had not been completed. Clearly, the material was purchased merely to show utilization of funds, without assessing the requirement on works. In Mohindergarh District, records showing segregation of expenditure on material and wages were not maintained. An expenditure of Rs. 4.31 crore was incurred on digging 257 ponds in Mohindergarh District, which is a drought prone area with scanty rainfall and where the soil is sandy and has no retention power. Block and GP officials admitted that the ponds dug under NREGS were without water. One pond had almost become a swimming pool, as 80 per cent of expenditure was incurred on material and masonry works. Test check in Mohindergarh revealed payment of Rs. 13.12 lakh to tractor/ camel cart owners for carrying out earthwork, in violation of NREGA Guidelines.
In Jharkhand, in the absence of AP in Palamu, the DC instructed BDOs to take up “work of irrigation well” in villages without assessing the requirement. Consequently, 1112 wells were taken up (December 2006) at a cost of Rs. 9.93 crore for completion by February/ March 2007, which remained incomplete as of July 2007. In Gumla, schemes for construction of 159 irrigation wells, ponds and tree plantation were sanctioned by the DC without holding the meeting of Gram Sabha for Rs 8.32 crore for completion by September 2006 to May 2007. None of the above works were completed within May 2007. On the recommendation of six MLAs, 71 schemes for Rs 5.14 crore were taken up (between March 2006 and May 2007) for execution, but these were neither in the Annual Plan nor approved by the Gram Sabhas. DC, Gumla sanctioned (March 2007) 100 units of “Safed Musli” cultivation for commercial farming for Rs 1.24 crore at Rs 1.24 lakh per unit, which had only 12 per cent (Rs 15.30 lakh) labour component. In West Singhbhum, of 4,326 works executed (2006-07) for Rs 52.13 crore, 2,373 were PCC Roads where labour component was as low as 19 to 24 per cent as against the norm of 60 per cent.
In Madhya Pradesh, tractor and rollers were engaged on MRs for transportation of material and compaction of road and tank works; CEO, ZP Sidhi incurred Rs. 20.80 lakh on spraying of hormones for jatropha plantation on contract basis through M/s Sai Biotech company, Rewa.
In Orissa, in Bhawanipatna block of Kalahandi District, 149 works were executed at a cost of Rs 7.55 crore between February 2006 and March 2007 through contractors in the guise of Village Labour Leaders (VLLs) (up to November 2006) and in the name of departmental execution through the Junior Engineers (from December 2006).
In Tripura, Rs.9 lakh was transferred (November 2006) to the account of Divisional Forest Officer, Manu for construction of 72 IAY type houses, in violation of NREGA guidelines. Rs. 52.44 lakh was incurred on construction of a Motorstand where the ratio of the wage cost to material cost was 30:70. Similarly, in 62 projects under 2 Panchayat Samitis, Rs. 106.91 lakh was incurred where ratio of wage – material cost ranged from 9:91 to 31:69.
In Uttarakhand, works of Jal Nikaas Naali, in one GP, amounting to Rs. 15220 was not commenced, but the expenditure was reported in the MPR.
In West Bengal, an expenditure of Rs.38.49 lakh was incurred in 20 works for execution of non-existent quantities of work, which was detected during joint physical verification.
Non-Payment of Minimum Wages, Delayed Payments:
The audit noted the widespread violations of the stipulated norms of employment, measurement of work, wage payment etc…, and observes that "non-payment of minimum wages, and delayed payment of wages is illegal, and also defeats NREGA’s objective of providing livelihood security. In the absence of a detailed listing of tasks in different geo-morphological conditions, conduct of work, time and motion studies for fixing of productivity norms, and preparation of separate DSRs, the principle that seven hours of normal work should earn no less than the minimum wage is defeated. This is especially important as any willing adult member can seek employment under NREGA, while construction works undertaken in other departmental works would place a premium on healthy and able bodied individuals."
Employment Generation Far Short of 100 Day Promise:
The Audit conducted a review of the employment provided (as per the Monthly Progress Reports (MPRs) of March 2007) in 465 GPs in 111 blocks in 26 States, which revealed that the average employment provided to each registered household was 18 days, and only 3.2 per cent of the registered households received 100 days or more of employment.
The average mandays of employment generated in test-checked GPs, state-wise, was as low as 2 (West Bengal), 5 (Tripura), 7 (Jharkhand), 8 (Kerala), 13 (Assam), 15 (TN), 20 (Orissa).
In many states, the actual demand for employment could not be verified as no applications were received and records were not maintained. Non-payment of compensation in case of delayed wage payment was rampant.
In the case of Jharkhand, the audit noted "in 10 districts, 6.10 lakh applicants were reported to have been provided employment against 0.70 lakh households, while in three districts, 0.10 lakh applicants against 0.90 lakh households were reported to have been provided employment. These figures are clearly unreliable."
In Manipur, "No written applications for work were on record. Work was provided on verbal consent of workers."
In Orissa, in 48 test checked GPs, against 31,027 BPL households, 37, 630 households were registered, and only 13,778 households were provided employment during 2006-07. Even where 100 days of employment were shown to have been provided, the audit noted that it "was also not free from doubt, as physical verification of job cards of 13 out of 14 test checked households revealed only 10 to 96 days of employment, as against 100 days or more shown in the online job cards."
In Rajasthan, the audit notes, "10.94 lakh households (73 per cent of registered households) demanded employment, and 100 days of employment was provided to only 2.39 lakh households. Thus, the claim of the State Government of generation of 999 lakh mandays at an average of 91 days per household demanding employment appears unrealistic."
Regarding West Bengal, the audit notes, "Employment provided under N.F.F.W.P. was not recorded in the employment register and relevant job cards, but mandays generated under N.F.F.W.P. were shown in the Progress Report as an output of N.R.E.G.S."
Improper Maintenance of Muster Rolls:
The audit documents the widespread irregularities, forgeries and the like in maintenance of MRs, stating, "MRs form the single most important document under NREGA. Improper maintenance of MRs makes identification of genuine beneficiaries difficult, especially in the absence of bank/ postal payments."
Non-availability of Records:
The audit concludes that "in the absence of maintenance of critical registers, especially at the GP level, it is impossible to authentically verify how many households demanded employment; how many households were provided employment, and for how many days; how many households got 100 days of employment; what was the break-up of SC, ST and women beneficiaries, and how much employment did they demand and receive; what was the entitlement of individual households to unemployment allowance" and "thus, the compliance with the legal guarantee of 100 days of employment on demand is not verifiable, based on available documents. In addition, transparency and accountability is adversely affected. Also, in the absence of these documents, the relevance of social audit is undermined."
Inflated/ incorrect reporting of physical and financial achievements is another of the observations of the audit, and also "status of monitoring, evaluation and social audit was also not up to the mark."
The COG Audit also includes a range of recommendations, many of which are thoughtful and useful. However, it remains that even the best of suggestions and methods can be of use only if Governments in question wish to correct the irregularities, curb the vested interests and make NREGS something more than a mere showpiece of the ruling elite.