CAG blasts govt claim on savings from direct benefit transfer

The Comptroller and Auditor General has contradicted the government’s claims of huge subsidy savings from direct benefit transfer (DBT).

He said that only Rs 1,764 crore in subsidy was saved on LPG on account of the scheme and the bulk of Rs 21,552 crore was due for sharp fall in global prices.

“The actual subsidy payout during the period from April 2015 to December 2015 was Rs 12,084.24 crore, as against the Rs 35,400.46 crore during April 2014 to December 2014," the CAG report in Parliament said on Friday.

“The audit examination indicated that the reduced subsidy rate on account of the fall in crude oil prices resulted in a reduced subsidy payout of Rs 21,552.28 crore, while the effect on the same due to reduced offtake of cylinders by consumers worked out to Rs 1,763.93 crore,” the report said.

“Therefore, it is evident that the lower subsidy rates in 2015-16 is by far the most significant factor that resulted in subsidy savings,” the report said.

“Considering that audit scrutiny of selected sample revealed existence of multiple connections, the entire database needs to be scrutinised by the oil marketing companies and effective action should be ensured. Transparency and integrity of database needs to be maintained. While OMCs have assured the institution of appropriate checks for new additions to the consumer database, there is an urgent need to ensure correctness and integrity of the existing database,” the CAG said in the report.