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Compliance Performance

Kerala

Report No. 5 of 2014 - Compliance and Performance Audit on Local Self-Government Institutions of Government of Kerala

Date on which Report Tabled:

Mon 14 Jul, 2014

Date of sending the report to Government

Government Type

State

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Sector -

Overview

This Report comprises four chapters of which Chapters I and II contain an overview of structure, accountability, finances and financial reporting issues of Local Self-Government Institutions (LSGIs) and comments arising from supplementary audit under the scheme of providing Technical Guidance and Supervision (TGS) arrangement. Chapters III and IV contain petformance/compliance audits and eight transaction audit paragraphs. Copies of draft performance and compliance audits and transaction audit paragraphs were forwarded to the Government and replies wherever received have been duly incorporated. Accountability framework, finances and financial reporting issues of LSGIs

Though there has been improvement in investments in Infrastructure and Service sectors (except during 2012-13) which is a positive development, the amount spent in Productive sector like Agriculture, Animal Husbandry, Fishing, etc., registered the lowest of all values during the five year period 2008-09 to 2012-13. There was increase in other expenditure like salaries, honorarium, contingency expenditure, etc. The Development Expenditure Fund released to the Grama Panchayats was short by Rs. 132.40 crore due to mistake. With reference to the cost of the projects formulated, the percentage utilisation of funds in the LSGIs was only 47.32. The largest shortfall in the implementation of the projects was noticed in Corporations. There were shortcomings in the financial administration like budget preparation, submission of monthly progress reports, preparation of monthly accounts, etc.

The EMS Total Housing Scheme was launched in the State in 2008. The ultimate goal of the scheme was to provide land and house to all landless and homeless in Below Poverty Line category. The scheme was to be implemented by Local Self-Government Institutions (LSGIs) with the support of the Government. The fund required was to be met out of Development Expenditure Fund, Own Fund and General Purpose Fund of LSGIs and loans from Banks. The Scheme was implemented initially for a period of three years from 2008-09 to 2010-11 which was subsequently extended up to March 2012.

Performance of the scheme during the period 2008-09 to 2011-12 was poor as 90 per cent of the homeless families in urban area and 76 per cent in the rural area remain uncovered. Though the scheme intended to give topmost priority for providing land to the landless, this component of the scheme remained largely inoperative during the scheme period. Implementation of the scheme was hampered due to shortfall in mobilization of funds. As against the requirement of Rs. 5861.56 crore for the implementation of the scheme, the LSGIs mobilized only Rs. 1452.97 crore. Expenditure of Rs. 35.50 lakh incurred by Kollam Corporation for purchase of land and construction of houses had become wasteful as the land purchased was marshy and unsuitable for construction. As one LSGI had availed loan in excess of requirement, the Government had to bear avoidable interest burden of Rs. 14.97 lakh.

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Report No. 5 of 2014 - Full Report
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