The CAG has found several shortcomings in the implementation of the first UPA government’s Rs. 52,500-crore farm loan waiver scheme — while thousands of ineligible farmers got the benefit, many eligible applicants were left out.
The CAG report, tabled in Parliament on Tuesday, disclosed that it had audited 80,299 beneficiaries across 25 states, which was less than 1% of the total 34.5 million recipients.
The scheme had two components — a total loan waiver for farmers who own up to two hectares of land and one-time relief of 25% for those who own more, provided they had deposited the remaining 75% of the loan amount.
The report said under the pre-poll scheme announced in 2008 keeping an eye on the 2009 general elections for tackling farmers’ indebtedness, some beneficiaries had taken loans for even buying vehicles or building houses, while 1,257 eligible farmers were turned down.
The report is not as potent a political scam as some of the recent CAG reports have been since it does not point finger at any particular group of people or specifies the amount allegedly embezzled.
But main opposition party BJP was quick to lap up the opportunity.
“This is a fraud. The exchequer has been defrauded and this amounts to a scam,” said BJP spokesperson Prakash Javadekar. Congress spokesperson Rashid Alvi, however, was cautious in his reply.
He said his party would react once the public accounts committee had a look at the report.
A National Crime Records Bureau report, however, showed that there was no increase in farmers’ suicides – which was supposed to have triggered the scheme – during the period.
The CAG said in about 34% of the cases it had audited, there was no receipt from the beneficiaries or any proof of the issue of loan waiver or relief certificates. “Such certificates entitle farmers for fresh loans,” the report said.
The report also pointed out that micro-finance institutions had unduly benefited from the scheme in violation of the
guidelines. Banks, too, claimed penal interest, legal charges and miscellaneous charges, among other things, from the government, although they were supposed to bear these charges themselves.
The department of finance services, the nodal agency for implementing the scheme, had instructed banks to register cases against erring officials.