Rs 36.66 lakh were spent on renovating engineer's office; Rs 95 lakh lost on interest, says report.
The Bruhat Bengaluru Mahanagara Palike (BBMP), infamous for delaying payment for development works already completed by contractors, has apparently been diverting funds meant for paying contractors to renovate one of its engineer’s office.
The Report of the Comptroller and Auditor General of India on Local Bodies for the year ended March 2012 has discovered this diversion of sub-mission project funds. “According to financial rules, funds released for projects should not be diverted or utilised for purposes other than those for which these were released,’’ said DJ Bhadra, Principal Accountant General (General and Social Sector Audit).
Scrutiny of bank statements and records showed that the BBMP had diverted Rs 36.66 lakh released for stormwater drain (SWD) projects for payment of contractors’ bills (March 2008) towards execution of interior works of the Office of the Chief Engineer, SWD situated at Jayanagar Shopping Complex. “The special commissioner, BBMP, replied (March 2013) that this amount had been recouped from the BBMP funds. However, on verification by audit, it was found that this amount had not yet been recouped (March 2013),’’ said Bhadra.
The BBMP operated the Thirteenth Finance Commission (TFC) funds through a current account opened in Syndicate Bank instead of a savings bank account, which yields interest on unspent amount. As a result, the BBMP lost the opportunity of earning interest of Rs 95 lakh (approximately) on unspent funds lying in the bank account during the period 2010-11 and 2011-12 at the rate of 3.5% of interest applicable on savings account. The BBMP replied (December 2012) that there was no instruction to keep the amount in savings account.
“However, the fact remained that the BBMP could have earned an interest of Rs 95 lakh in case the amount had been kept in the savings account,’’ the report said.
Of the entrusted 1,524 houses in slums, the Karnataka State Police Housing Corporation Limited (KSPHCL) could take up only 124 dwelling units (DUs) at five slums at an estimated cost of Rs 4.59 crore. However, the BBMP released Rs 15.62 crore to the KSPHCL and the expenditure incurred as of December 2012 was only Rs 7.59 crore.
“Out of the balance funds of Rs 8.03 crore, Rs 4.5 crore was refunded to the BBMP and the remaining amount of Rs 3.53 crore was locked up with the KSPHCL,’’ the report said.
It said that the special commissioner, BBMP accepted that the remaining dwelling units could not be taken up for construction due to non-availability of land and unwillingness of beneficiaries.
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