CAG flays govt agency for anomalies in memorial works

According to the CAG report,the initial outlay for two works was Rs 881.22 crore,including Rs 366.82 crore for DASPS and Rs 514.40 crore for the MKRSS. “Due to frequent changes in the drawings/estimates from time to time and addition of new works,total sanctioned cost of the projects as revised up to 31 December 2009 stood at Rs 2451.93 crores (DASPS: Rs 1411.58 crore and MKRSS: Rs 1040.35 crore) against which funds of Rs 2261.19 crores (DASPS: Rs 1230.79 crore and MKRSS: Rs 1030.40 crore) were released between November 2007 and December 2009 by the government,” said the CAG report. It further said the works were suspended from September 2009 due to stay order of the Supreme Court. The progressive expenditure against the two works amounted to Rs 1776.57 crore up to December 2009.

The CAG report mentioned the project included installation of idols and other artistic works at the estimated cost of Rs 287.56 crore. Against this the company incurred expenditure of Rs 217.35 crore up to December 2009,the CAG report further said. “Since there were no standard rates available for comparison,the reasonableness of the rates at which the works were awarded for installation of idols and other artistic works,could not be vouchsafed in audit,” the CAG report found.

The CAG report has charged the executing agency with “failure to explore cost-effective alternative. Citing instances of financial irregularities,the report mentioned: “These resulted in extra expenditure of Rs 66.48 crore on the work,besides locking of funds on premature procurement of material,ultimately increasing cost of the works.”

As per the report,the two works involved construction of boundary wall and flooring of Mirzapur/Chunar sand stone. For this purpose,sand stones/blocks were transported from quarries at Mirzapur/Chunar to Bayana,Rajasthan (670 km) for sawing and carving and finished stones were transported from Bayana,Rajasthan to Lucknow (450 km) for use in the work,the report found. “We are of the view that if sawing and carving of sand stone were done at Mirzapur/Chunar itself by engaging cutters there and transporting finished sand stone from Mirzapur/Chunar to Lucknow (315 km),expenditure on transportation of sand stone could have been reduced to the extent of rupees Rs 15.60 crores due to reduction in distance of transportation (from 1120 km to 315 km). Such possibility for reduction in cost of the work was not explored by the management,” the CAG report pointed out.

Rejecting the management’s plea that stone processing could not get developed there due to location of quarries of stones in naxalite-prone areas in the outskirts of Mirzapur,the CAG report termed the reply as “not convincing”.

The report has also pointed out “execution of works at higher rates”. According to it,the Joint Purchase Committee (JPC) of the Company finalized (November 2007) labour rates of Mirzapur/Chunar Sand stone works for DASPS and MKRSS. The company placed works order on various contractors at the finalized rates. In December 2008,the JPC reduced the rates of aforesaid works.

“We observed that reduction in rates in spite of inflammatory tendency in the economy during the intervening period was indicative of the fact that the management failed to obtain competitive rates earlier and incurred avoidable expenditure of Rs 22.16 crore,” the report further pointed out.

In the report,the CAG has also pointed out extra payment to suppliers and irregular payment of service taxes.