CAG damns Delhi for midday meal mismanagement

The CAG, in its audit of the Delhi government vis-a-vis financial and HR management, implementation of schemes, development of infrastructure and internal control, has slammed the state education department for delay in supply of free text books, oversight in implementing midday meals, and poor budgeting.

The report says the education department (ED) implements, supervises, co-ordinates and monitors policy programs and plans for education in Class 1-12 for 942 government schools, 216 aided schools, 1,200 unaided-but-recognised private schools. It faults the department on the following counts:

A. Excess spend of Rs 23.05 crore

The report says that going by the General Financial rules of 2005, the controlling officer or head of a department should be in a position to estimate the likelihood of savings/excesses every month, regularise them, and report to the ED head, of any disproportionate expenditure.

Scrutiny of information and records provided by the planning branch revealed that the final expenditure under 11 heads exceeded available funds, leading to an excess spend of Rs 23.05 crore. It states that the expenditure in-excess of budget indicates poor financial monitoring, as regular reconciliation of expenditure figures was not done by budget branch. In reply, the ED said excess expenditure was due to unforseen escalation in cost of projects, and that the internal monitoring mechanism had been strengthened. However, it chose not to reply to the non-reconciliation of expenditure figures by the budget branch.

B. Mid day meal scheme

Under this scheme, nutritional support is provided to students of Class 1-8 in state and aided schools, to prevent nutrition deficiency and intake of unhygienic food, and reduce absenteeism. An examination of records at 12 district offices for aided-, as well as 143 government schools, revealed that bills for supply for meals were not always accompanied by test certificates by authorised labs. A check of 415 bills aggregating Rs 112.53 lakh revealed that only 66 were supported by certificates, of which, 42, involving Rs 15.16 lakh, indicated substandard meals. However, no recovery or deduction was effected from any of these bills.

The report also states that out of 143 schools covered, 33 did not have weighing machines to ensure the quantity

supplied was as per norms. In fact, most schools had bathroom scales instead. Clause 14 of the agreement between ED and mid day meal contractors states that if a contractor fails to supply cooked food on a particular day, or replace supply of defective food in time, Rs 4 per meal (for primary), and `5 per meal (for upper primary) students would be deducted as penalty. Scrutiny of vouchers and bills of aided schools in West A and West B districts however revealed that the contractors failed to supply meals on 14 occasions in different schools. However, no penalty was levied by the district offices.

Meanwhile, ED made payments without scrutinising bills, which led to missing out `1.40 lakh in penalties. In March 2012, ED stated that all heads of schools have been issued notices to ensure that test certificates are attached to bills, and to keep weighing machines in all schools. It also stated that recovery had been effected from two suppliers, Indicare and Utsav Care, and that a process of black-listing Utsav Care would be initiated. 

C. Financial Management

The CAG report states that, according to the tables for 2008-09 and 2009-10, the actual non-plan expenditure exceeded original budget allocations. The excess expenditure was met by additional allocation at revised estimates. On the other hand, under the plan head, the expenditure fell short of original allocation, that led to savings. This indicated deficient budgeting leading to unrealistic projections.

In their reply given in March 2012, ED stated that the actual expenditure under non-plan was within modified allotment, necessitated by the implementation of the Sixth Pay Commission. With regards to underutilisation of plan budget, the ED cited as cause non-finalisation of the proposal for purchase of equipment for schools, non-concurrence to proposal for building swimming pools in schools in 2008-09, non-finalisation of proposal for purchase of computers, stoppage in supply of mid day meals following hospitalisation of some children in 2009-10, change in practice from paying for cost of text books in advance to paying after receipt of books in 2010-11, and delay in approval of expenditure for outsourced services. The CAG report states that reasons given by the ED augment audit observations, that budgeting was done without assessment of ED’s ability to spend.

D. Poor Budgeting

In order to prepare the annual financial budget, the ED budget branch obtains requirement of funds from drawing and disbursing officers (DDO). Requirements from only 467 of 926 DDOs were received in time for preparing the estimates in 2009-10, and 741 of 936 DDOs for 2010-11. As a result, budget projections were made on the basis of previous year’s spend. Not even inputs from user offices were received in time to prepare revised estimates, forcing a large number of reappropriations among various budget heads at a later stage.

The ED stated in March 2012 that budget estimates for 2009-10 and 2010-11 were made on the basis of data provided by DDOs and previous year’s spend, and that DDOs have been instructed to prepare budget estimates on a realistic basis to monitor plan and non-plan spend more effectively.

Regarding appropriation of budget, the report states that after Delhi Assembly passed the budget, it was reappropriated a large number of times, significantly distorting the original intent of its approval in the Assembly. When this was pointed out, the ED said observations of the audit have been noted for future compliance.