CAG Report: NST department running on glitches

Kohima, April 3 (EMN): The Nagaland State Transport (NST) department has landed itself in the latest report of the Comptroller and Auditor General of India (CAG) for a series of anomalies including improper planning, diversion of funds, misappropriation of revenue, inability to take off infrastructure created worth crores. According to the report, a performance audit was carried out in May 2016 to September 2016 on the activities of the NST from 2010-16. On the planning front, the audit observed that the department had not carried out processes such as survey, feasibility study and assessment to ascertain operational requirements of its services within the state while preparing its annual action plans. It pointed out that the department did not maintain database of the routes being operated and asset register including fleets, buildings, land etc., thus the information it provided about fleet position and other assets varied from ‘time to time’. “The department initially furnished details of operating 76 routes and 96 scheduled services as on March 2016 but in November 2016, the department stated the position of routes as 155 notified routes out of which routes in operation were stated as 91,” the CAG report informed. It stated that fleet position also varied from 214 buses, a recovery van and one truck to three extra buses and an additional ambulance. Only 117 buses, 1 recovery truck operational Out of the total fleet size of the NST, only 117 buses and one recovery van are in operation and the remaining 97 buses and one truck were either ‘proposed for condemnation/uneconomical for running’ or were lying in the lone central workshop in Dimapur for repairs. The report stated that the department had, in November 2016, maintained that the state had 155 notified routes out of which, 91 were in operation and 64 routes were under suspension due to shortage of fleet, bad road condition and non-availability of passengers. Further, 23 routes out of 64 were withdrawn due to route overlapping, and the shortfall in services was attributed to insufficient operational buses. The CAG pointed out that the varying figures mentioned by the department lacked supporting documents. It also informed that during the last five years, public demanded a total of 54 operation of routes, of which, 18 were surveyed and 11 were approved by the government but only 7 routes were put to operation. Therefore, the number of routes operated by the department against public demand remained very low. The report said the department clarified that out of 54 demands, 35 were surveyed, 17 approved and 13 were operational, however, this claim was not supported by documentary evidence either. Meanwhile, percentage of services operated in four stations-Mokokhung, Kohima, Phek and Zunheboto- without conductors during the last 5 years ranged between 4.13% to 59.50%. To this, the department is stated to have assured disciplinary action against the absentee conductors under relevant service rules. Improper utilisation of division/station workshops Also, the report said examination of records revealed that except the central workshop in Dimapur which has one functioning breakdown vehicle, none of the divisional and station workshops had breakdown vehicle, ambulances or mobile workshops, thus unprepared for emergency situations. The department is stated to have cited shortage of fund as the reason. Audit also observed that while there were sufficient number of technical personnel in the divisional and station workshops, almost all the vehicles were sent to the central workshop in Dimapur for repairs and maintenance, as a result of poor supply chain management of spare parts and division workshops not being properly utilised. Physical verification carried out in divisional workshops of Kohima and Mokokchung revealed that none of the buses attached to the divisions were brought to the divisional workshops for repair, and system followed for placing indents was not streamlined. On station facilities, the report said physical verification of 12 stations/substations revealed that none of them provided basic facilities such as display of scheduled departure/arrival/delay, public announcement system, waiting rooms, basic amenities like toilets, drinking water etc. Department is said to have claimed that fare-chart along with destination and daily derailment chart were displayed in all the stations and toilets and waiting hall were provided, but the report pointed out that this was not corroborated during joint verification in selected stations. Gap between salary and revenue Department expenditure on salary and allowances of the employees had increased from Rs 25.69 crore in 2011-12 to Rs 36.99 crore in 2015-16, whereas the revenue receipts from operation of services decreased from Rs 12.96 crore in 2011-12 to Rs 12.54 crore in 2015-16. This is indicative of the department not being able to improve its operating efficiency in commensurate with increased salary during the last five years. The department is said to have attributed the decline in revenue to depleted fleet strength and over-aged buses, but remained silent on increase in salary expenditure. Diversion and loss of revenue Examination of records of 5 stations – Dimapur, Kohima, Mokokchung, Phek and Zunheboto – revealed that revenue realised from operation of the department amounting to Rs 4.64 crore (2011-16) were utilised for departmental expenditure such as fuel for operation of bus services and workshop, electricity bills and other petty expenditure. Out of the total amount, Rs 0.30 crore is yet to be recouped by the department to government accounts. CAG pointed out that department cited ‘compelling circumstances’ in order to avoid suspension of services as the reason for diversion, but the fact remained that such diversion for meeting administrative expenses violated provisions of rules. The CAG report also informed that the department had incurred a revenue loss of Rs 6.92 crore through cancellation of schedules and trips in the five selected stations from 2011-16. The reasons for cancellations were not found in record, although the department cited shortage of vehicles, bad road conditions, bandhs, low traffic flow, landslides/roadblocks. The instance of diverting certain amount of fund under negotiated loan meant for renovation of fleet in purchasing two smaller vehicles (Mahindra Bolero), not utilised for passenger traffic, was also pointed out. Subsidised chopper services overused by VIPs The state helicopter service in collaboration with aviation companies operates weekly chopper services at subsidised rate in 9 districts headquarters – Dimapur, Kohima, Mokokchung, Wokha, Tuensang, Zunheboto, Mon, Kiphire and Phek – with the subsidised cost borne by the union ministry of Home Affairs. The CAG stated that the subsidy scheme is primarily meant for carrying common passengers and only in cases of absolute necessity, not more than 25% of flying hours are to be used for VIP movements, while in the case of usage by VIPs and/or officials from the central government, the expenditure is to be borne by the ministry/department concerned. Audit observed that the department operated chartered services on subsidised rates, resulting in 39-60% of chartered services being used by VIPs and government officials on subsidised rates which were included in the claim for subsidy from the centre. Upon examination of the claims submitted by the department to the Ministry for reimbursement of subsidy, the report stated, it was revealed that claims of Rs 44.25 crore (April 2011-March 2016) was made, while it was entitled to a claim of only Rs 20.87 crore. The CAG stated the department’s reply which says the percentage of occupancy of seats by VIPs was 8% and not as observed by audit, was not acceptable as the average number of chartered services operated for VIPs during the last 5 years was 54.45%. Infrastructure not able to put to use The CAG report also highlighted that the department constructed a helipad at Alichen at a cost of Rs 0.66 crore which was certified as complete in May 2012 and was ready to put for use. However, it observed that the project was executed in arbitrary manner without prior clearances, survey of site resulting in blockade of funds spent on construction, and the helipad could not be made functional even after 46 months of its completion. It stated that the department’s reply confirmed as due to negligence, the helipad could not be put to use and an additional expenditure of Rs 0.25 crore would be required to put it in operational condition. The CAG stated that the construction of Inter State Bus Terminus (ISBT) at Kohima funded by NEC at the cost of Rs 9.12 crore was taken up by the NST in December 2006 and while the major component of work worth Rs 8.92 crore was completed in May 2015, maintenance of approach road and water supply construction were yet to be completed as of November 2016 due to land dispute on the site. On construction of ISBTT at Peren for which the ministry of Doner sanctioned Rs 8.74 crore and released an amount of Rs 4.94 crore and the state government released its matching share, CAG stated that the work was to be completed by April 2014. It was found that department has made fictitious entries in the measurement book and made payments on these entries without actual execution of works. The department is stated to have instructed the contractor, M/s S Solo Engineering Dimapur to accelerate the works and complete the project within the revised target date of completion (March 2017), however, the department remained silent on initiating any enquiry on failure of internal controls. Recommendation Following observations, the CAG recommended that the department should put into place effective controls and monitoring mechanisms, lay emphasis on planning with adequate focus on feasibility studies and surveys to assess operational and infrastructural requirements realistically.