Govt investment on PSUs yield tepid returns: CAG

Last Updated: Thu, Dec 13, 2012 21:29 hrs

The investments made by the Odisha government on PSUs in 2011-12 have yielded lacklustre returns. While the state government invested Rs 2,908.07 crore during 2011-12, the return was Rs 286.23 crore, representing 9.84 per cent of the total investments, according to a report of the Comptroller & Auditor General of India (CAG) on state finances for the year ended March 31, 2012.

Of the total return crore received from PSUs, state controlled miner-Odisha Mining Corporation (OMC) alone contributed Rs 285 crore. The state government did not receive any return from 108 concerns which account for 84 per cent of the total equity holding of the state government.

In essence, one statutory corporation, 77 government companies and 30 cooperative societies where Rs 130.51 crore, Rs 1,990.60 crore and Rs 308.22 crore had already been invested did not pay any dividend to the government.

Grid Corporation of Odisha (Gridco) and Odisha State Road Transport Corporation (OSRTC) with accumulated losses of Rs 101.25 crore and Rs 228.02 crore respectively and Odisha State Financial Corporation (OSFC) with loss of Rs 375.76 crore were among the major loss making PSUs, the CAG report pointed out.

The Central auditor also pulled up the state government for huge pendency in submission of utilization certificates (UC) that has climbed to Rs 27,917.72 crore by the end of 2011-12.

The highest pendency in UC submission has been noticed in case of panchayati raj department at Rs 8,304.50 crore followed by housing & urban development (Rs 4,107.97 crore) and school & mass education (Rs 3,324.72 crore).

The CAG report stated that delays were noticed in submission of annual accounts by the commercially managed departmental undertakings. There were 1,759 instances of misappropriation and defalcation which involved Rs 17.09 crore up to March 2012 on which final action was pending.

Stating that parking of funds in personal accounts adversely affected the transparency of state accounts, the CAG report said, Rs 656.07 crore was lying unspent in 889 personal deposit accounts (as on March 2012) and were not credited back to the government account.

Taking a dig at the state government’s bloating food subsidy at Rs 979 crore, the CAG report pointed out that it exceeded the normative projection of the 13th Finance Commission of Rs 84 crore due to the implementation of the Rs 2 per kg rice scheme introduced during 2008-09 and which continued through 2011-12.

The CAG report said during 2011-12, there was overall saving of Rs 7,258.40 crore but the savings were mainly due to slow programme implementation and largely contributed to surpluses on the revenue account.

“There were instances of persistent savings, excess expenditure and expenditure without provision of funds, excessive supplementary provision, substantial surrenders, non-surrender of anticipated savings during 2011-12 and instances of rush of expenditure during the last month of the financial year,” the report added.

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