The Comptroller & Auditor General (C&AG) found a difference of Rs 4,478 crore between the money received and distributed between 2018 and 2021. C&AG has stated that the Kerala government could not give any reason for the mismatch. The transaction accounts of Pension Direct Benefit Transfer (DBT) Cell and Pension Company during the years 2018-19, and 2019-20 do not match.
According to the accounts DBT Cell submitted before C&AG, Pension Company had paid Rs 11,088.09 crore to the Panchayat Directorate. But, the company’s accounts show Rs 9,699.48 cr. The State government of Kerala has informed C&AG that the Panchayat Director and Pension Company are instructed to look into the disputed accounts. The report states that the government should make sure that the misuse of the accounts does not pave way for corruption.
Kerala Social Security Pension Limited was launched in June, 2018 under Ministry of Finance. It was formed for the distribution of Social Security Pension. It was expected to find out funds from the financial institutions, public sector undertakings and deposits for the distribution of pension.
Reports say that since 2018, every year, GoK avails more loans than necessary. In 2019-20, Company availed Rs 4049 crore more than the pension requirements. But, government explains it as a mere error. In 2018-19 the Company had borrowed Rs 1000 crore from BEVCO but do not have proper documents or explanations, hence the transactions could not be audited.
During 2018-19 to 2020-21, Rs 1,596 crore had been paid, by the Company, as interest; it was from the loan amount. The general understanding is, GoK carries the liability of the loans the Company avails for paying pension amounts. This condition was violated when the Company paid up the interests. Rs 10,848 core, of the loans for the pension payment, remains unpaid. If it is paid from the GoK’s reserve funds, the government spending will go up.
The Company transacts huge amounts for the pension payments and they do not have any other registers, for these transactions, other than the passbooks. The Company auditors have reportedly mentioned that they could not ascertain the amounts of paid up pension, held up amount, status of the pension distribution, etc., due to the absence of the necessary documents. According to the C&AG, these lacunae may lead to financial irregularities and misuse; they should be solved immediately.
Another serious findings of the C&AG is the lapse in tax collection. Rs 28,258.39 crore remain uncollected. The ‘top auditor’ does not see it as the mere failure of the bureaucracy, but, the shortcomings of the ‘system’. The arrear amount of Rs 28,258.39 constitute 24.23 per cent of the gross revenue of the state. C&AG also found that details of the arrear collection are not communicated to the Revenue Department regularly. Principal A.G. Sunilraj told the media men that there are lapses even from the side of the respective departments.
He said that the largest uncollected tax amount belongs to Goods & Service Tax department, that is, Rs 13,410.12 crore. In most cases, the confiscation is prevented by court or the government hence tax collection adversely affected. Major shortcomings of the Goods & Service Tax sector are inadequacy of the checking apparatus, lapse in utilising the information getting from Data Mining Cell and noncompliance of the union government’s instructions.
Here are some of the alarming details of the tax arrears:
- Motor vehicle department: Rs 2,868.47 crore
- Electricity: Rs 3,118.50 crore
- Registration: Rs 590.86 crore
- Forest: Rs 377.07 crore
- Police: Rs 346.64 crore
- Excise: Rs 281.63 crore
- Mining & Geology: Rs 163.81 crore
C&AG has found that about 38,200 transport vehicles are sans fitness. It has caused the loss of Rs 2.98 crore. Not only that, these shorts of vehicles cause chances for accident. There are lapses in collecting taxes and service charges.
C&AG has found out lapses in changing the bar licenses also. Excise department has violated the conditions for charging the fees for changing the bar licenses from one licensee to other. It led to the loss of Rs 2.17 crore. Excise department’s prior permission is required for the reconstitution of the director board of the ‘indigenous foreign’ liquor distilleries. Rs 300,000 is the penalty for not informing the Excise department. Twenty one companies reconstituted their boards; loss due to the uncollected penalty is Rs 1.32 crore. GoK had declared relaxation for the bar licensees during Covid lockdown period. But, there are errors in calculating the same hence the loss is Rs 33 lakhs.
The above findings are shocking and construed as disasters which could have been averted if properly managed. And, the same time, GoK is still in spending spree in extravagant style. This journal had recently carried a story regarding the helicopter hiring of GoK. The same GoK keeps on blaming the union government for all fiscal problems the state face. GoK should opt stringent fiscal restrictions in its spending and should move to efficient tax collection. Blame game is not enough.
