1. CAG slams govt’s paddy procurement and milling policy

CAG slams govt’s paddy procurement and milling policy

The report said that there was a possibility of MSP being released without ascertaining the bona fides and genuineness of the farmers

By: | New Delhi | Updated: December 9, 2015 1:25 AM

Criticising the government’s policy on milling and procurement of paddy for the central pool stocks, the Comptroller and Auditor General of India (CAG) on Tuesday stated that there are large-scale delays in the delivery of rice by millers, resulting in undue gains. CAG has recommended obtaining collateral security for paddy and rice handed over to the millers for conversion to rice.

The top audit body also raised doubts about whether genuine farmers got the minimum support price (MSP) for their paddy in states, especially Andhra Pradesh, Haryana, Punjab, Telangana and Uttar Pradesh in the 2013-14 marketing season (October-September). These states contribute more than 70% of the paddy procurement carried by Food Corporation of India (FCI) and state government-owned agencies.

The CAG report on procurement and milling of paddy for the central pool also said that there was possibility of MSP being released without ascertaining the bona fides and genuineness of the farmers.

“A large number of deficiencies like non authentication of land holdings of farmers, cases of payments to farmers with doubtful identity, non-obtaining MSP certificates, non-availability of details of farmers bank account number, name of village etc. were noticed in the states of Andhra Pradesh, Haryana, Punjab, Telangana and Uttar Pradesh,” CAG stated in its report tabled in Parliament.

The report also stated “there is poor control over custody of paddy or rice resulted in not only undue gains to the rice millers but also widespread and large scale non-delivery of paddy and rice by them. Moreover, because of uneven operational practices and costing parameters huge avoidable expenditure was incurred throughout the country.” The audit report also stated that in the selected districts of Bihar, Haryana, Odisha, Punjab, Uttar Pradesh and Telangana in 2010-11 and 2013 -14, 15.89 lakh tonne of paddy and 23.34 lakh tonne levy rice valued at R7,570 crore was not delivered by millers to FCI or state agencies.

“In absence of collateral security from the millers, the FCI or state agencies had no recourse to recover the value of non-delivered customs miller rice (CMR). This practice also increases the risk of misappropriation of CMR and diversion to open market of levy rice by the millers,”CAG stated in its report.

The CMR or levy rice was envisaged by the Centre to take advantage of the synergies between public sector procurement structures and private sector milling capacities. While the paddy procuring agencies like FCI and state agencies purchase paddy from the farmers and give it millers for processing. Millers supply rice equivalent of paddy within stipulated period.

The Centre provides food subsidy to FCI, which is the key agency of the government for procurement and distribution of wheat and rice under targeted public distribution system and other welfare schemes and for maintaining the buffer stock of food grains as a measure of food security.

Auditor’s rap
* Criticising the government’s policy on milling and procurement of paddy for the central pool stocks, the Comptroller and Auditor General of India (CAG) on Tuesday stated that there are largescale delays in the delivery of rice by millers resulting in undue gains
* The country’s top audit body also raised doubts about whether genuine farmers got the minimum support price for their paddy in states

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