VIDARBHA FARM RELIEF PACKAGE-COMPLETE CAG REPORT

CHAPTER I: INTRODUCTION
1.1 The Packages
The sharp increase in the number of suicides in six districts of the Vidarbha
Region from 146 in 2003-04 to 455 in 2004-05 led the Government of
Maharashtra (GOM) to announce a package called ‘Special Package for
farmers’ earmarking Rs 1075 crore in December 2005. The suicides, however,
continued unabated and the number increased to 1414 during 2006-07.
(Courtesy: Dainik Bhaskar, a Nagpur daily)
Government of India (GOI) also declared (July 2006) a package called
‘Special Rehabilitation Package’ to mitigate the distress of farmers in
31 districts in four States, of which six districts were in the Vidarbha Region
of Maharashtra. The package involved Rs 3750 crore, to be spent over three
years. The packages included long term and short term relief measures for
alleviating rural distress and preventing farmers’ suicides in the six most
suicide prone districts of Vidarbha viz. Amravati, Akola, Buldana, Wardha,
Washim and Yavatmal.
These packages consist of various components like rescheduling of loan/debt
relief to farmers, seed replacement, assured irrigation facilities, financial
assistance to farmers for increase in production, community marriages,
immediate relief to the family of the deceased, ex-gratia assistance for
education and medical needs from the Prime Minister’s National Relief Fund
Audit Report (Farmers’ packages) for the year ended 31 March 2007
2
(PMNRF), etc. Details of the various components of the packages are in
Appendix I (Page 33).
1.2 Organisational set-up
Principal Secretary, Relief and Rehabilitation (R & R) wing of Revenue and
Forests Department was responsible for extending relief measures to the
farmers in distress. Director General, Vasantrao Naik Sheti Swawalamban
Mission (VNSSM), Amravati was to monitor the relief measures taken up
under the packages. Director General was assisted by the Collectors at district
level. Various components of the packages were implemented through seven1
departments as detailed in Appendix II (Page 34).
1.3 Audit objectives
The performance audit of ‘Farmers’ Packages’ was conducted with a focus on
four principal themes viz. assessment and handling of agrarian distress,
immediate (short term) relief measures, long term measures for income
augmentation and monitoring, reporting and the impact.
The main Audit objectives were to examine and assess whether:
􀂾 the assessment of agrarian distress was adequate and allocation of fund
was realistic,
􀂾 the institutional mechanism for grant of relief was efficient and
effective,
􀂾 relief provided to farmers improved their financial status and reduced
the distress,
􀂾 appropriate monitoring and reporting mechanism was in place
1.4 Audit criteria
The Audit criteria adopted in this performance audit were:
􀂾 Reports of the Indira Gandhi Institute of Development Research, Tata
Institute of Social Sciences (IGIDR/TISS) and the Fact Finding
Committee,
􀂾 Survey reports of distressed farmers and other related data available
with the Government/Departments,
1 (i) Agriculture, (ii) Animal Husbandry and Dairy Development, (iii) Co-operation,
(iv) Relief & Rehabilitation, (v) Water Conservation (vi) Water Resources and (vii) Women &
Child Welfare
Chapter I - The packages
3
􀂾 Instructions/guidelines issued by Relief and Rehabilitation
Department, the line departments and National Bank for Agriculture
and Rural Development (NABARD),
􀂾 Rules and Orders for effective utilisation and proper accounting of the
funds allotted under the packages.
1.5 Scope and methodology of audit
The performance audit was conducted (March to June 2007) by test check of
records in the Relief and Rehabilitation wing, Departments of Agriculture,
Animal Husbandry, Dairy Development and Fisheries (AHDD&F),
Co-operation, Women and Child Development, Water Resources, Director
General (DG), VNSSM, Amravati, six District Collectors, six District Deputy
Registrars of Co-operative Societies (DDRCS), six District Women and Child
Development Officers, 18 (out of 64) Tahsils and Taluka Agriculture Officers
(TAOs), 34 branches of District Central Co-operative Banks (DCC Banks) and
36 branches of Nationalised banks and Cotton Federation including their
Zonal Offices.
(Six suicide prone districts of Vidarbha region of Maharashtra State)
The talukas were selected using stratified random sampling technique.
Expenditure of Rs 1383.46 crore (63 per cent), out of Rs 2189.30 crore
incurred on various components as of March 2007 was covered under the
performance audit (Appendix III and IV - Page 35 and 36).
Audit Report (Farmers’ packages) for the year ended 31 March 2007
4
Empirical Research Agency (ERA) Private Limited, Gomukh Trust, Pune was
engaged for conducting survey of the land holders (October-November 2007)
in eleven selected talukas of the six suicide prone districts of Vidarbha
Region. For this survey, the land holders were selected (Appendix V –
Page 37) after stratifying them into following three strata (i) land holding less
than two hectares, (ii) land holding between two to six hectares and (iii) land
holding more than six hectares. A questionnaire about awareness of the
package and benefits of the package was designed (September 2007) for this
survey. Survey results are incorporated in the report at the appropriate places.
The results have also been shared with GOM. Executive summary of the ERA
report is at Appendix VI (Page 38).
The audit objectives, audit criteria, the scope and methodology of audit were
discussed in a meeting held on 12 February 2007 with the Principal Secretary,
Relief and Rehabilitation wing wherein the Director General, VNSSM,
Amravati, Commissioner of Agriculture, Pune and officers from Co-operation,
Animal Husbandry, Dairy Development, Water Conservation and Water
Resources Department were present. Exit conference was held between 20 and
23 November 2007 and audit observations were discussed with the Chief
Secretary of the State and Principal Secretaries/ Secretaries of the line
departments. Replies received from GOM before, during and after the exit
conference along with certain inputs received from GOI have been
incorporated at appropriate places in the Report.
1.6 Acknowledgement
The office of the Accountant General (Audit-II), Maharashtra, Nagpur
acknowledges the cooperation of the Relief and Rehabilitation wing and other
Departments during the performance audit of the ‘Farmers’ Packages’. The
inputs received from the senior officers of the Departments and the responses
to the audit observations helped in formulating the audit conclusion.
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CHAPTER II: CONCEPTUALISATION OF PACKAGES
2.1 Funding
The package declared by GOM was for Rs 1075 crore and the GOI declared a
package of Rs 3750 crore. The components of the GOI package are to be
implemented in three years. Four components of the GOM package
(allocation: Rs 564 crore) were also available beyond the six suicide prone
districts. In the six districts Rs 1010.90 crore was released of which
Rs 895.64 crore was spent upto March 2007, as reported by VNSSM
(Appendix III – Page 35). In the GOI package, three components (allocation:
Rs 306 crore) are also available beyond the six suicide prone districts.
Expenditure under seven components of the GOI package was to be shared (at
different ratios) by the State Government. In the six districts, Rs 1632.58 crore
was released (State share released: Rs 1306.62) of which Rs 1532.78 crore
was spent as of March 2007, as reported by VNSSM (Appendix VII –
Page 41). Information regarding total amount released out of the packages for
the entire State and the total expenditure incurred for the entire State though
called for was not furnished. Expenditure figures reported by the Departments
only have been considered for formulating observations in this Report.
The expenditure on the component ‘interest waiver’ of the GOI package was
to be borne by the Central and State Governments in a ratio of 50:50.
However, entire amount of Rs 712 crore was included in the total amount
(Rs 3750 crore) of declared GOI package. As Rs 239 crore had already been
spent out of the State’s share as a part of GOM package, GOI package was
overstated to that extent.
2.2 Components found deficient / uncovered areas
Scrutiny of the GOM and GOI packages disclosed that some of the
components of the package were deficient/ did not cover some areas critical to
achieve the objective of reducing the farmers’ distress, as detailed below:
Name of component and
purpose
Deficiencies/ Observations
‘Prime Minister’s
National Relief Fund
(PMNRF)’ in order to
provide financial
assistance for Health and
Education. (GOI)
Distress amongst farmers on account of cost of education
was not measured. Besides, allocation of funds (Rs 3 crore
at Rs 50 lakh per district) for health was meager as
compared to 92,456 cases of chronic illness noticed during
the survey conducted (June 2006) by the Revenue
Department in the six districts.
Principal Secretary, R&R stated (November 2007) that the
allocation of Rs 50 lakh per district was made on ad-hoc
basis.
GOI Package
was overstated
by
Rs 239 crore
Audit Report (Farmers’ packages) for the year ended 31 March 2007
6
‘Assistance to farmers’
for increase in
agriculture production.
(GOM)
(i) The component covered only 60,000 farmers on ad-hoc
basis (less than 5 per cent) out of 13.48 lakh farmers in
distress identified through departmental survey. Principal
Secretary, Agriculture stated (November 2007) that
60,000 farmers were targeted on ad-hoc basis.
(ii) The Fact Finding Committee (FFC) of the Planning
Commission recommended in March 2006 that the
minimum support price for agricultural crops should carry
appropriate variation for the region so that it reflected the
actual input cost and was not an estimated figure. Despite
this, the Minimum Support Prices (MSP) for four major
crops of the region declared by GOI during the years
2003-06 was 29 to 38 per cent less than the MSPs
proposed by the State Agriculture Price Committee
(SAPC) of the GOM during the period. During 2006-07,
the MSP declared by GOI was 31 to 40 per cent less than
the MSP proposed by the SAPC.
Implementation of the recommendation of the FFC could
have helped in reduction of farmers’ distress and the
consequent suicides. However, this was not included in
the package.
Long term measures viz.
supply of inputs and
implements, milch
animals and providing
micro irrigation system
at subsidized rates for
income augmentation.
(GOI and GOM)
These components were included in the package without
assessing the financial constraints of the farmers. While
some components envisaged contribution by farmer upto a
maximum of Rs 28,924, for the other components poverty
(annual income not exceeding Rs 20,000) was one of the
eligibility criteria.
Principal Secretary, Agriculture stated that GOM’s
proposal for reduction in farmers’ share was not accepted
by GOI.
Micro irrigation for
horticulture cropssubsidy
for drip
irrigation set. (GOI)
The component was included in the package without
changing the guidelines for non-horticulture crops.
Principal Secretary, Agriculture accepted the facts and
agreed to issue comprehensive specific guidelines for nonhorticulture
crops.
Concession in
agriculture Insurance
premia to protect the
farmers from the loss of
crops due to natural
calamities or other
reasons. (GOI)
Even though orange is the major horticulture crop in the
six suicide prone districts of Vidarbha region and every
year orange crop was damaged due to untimely heavy
rains or hail storms, orange was not considered for crop
insurance coverage by the Government. As such small and
marginal farmers could not get the benefit of the scheme.
Principal Secretary, Agriculture agreed (November 2007)
to refer the matter to GOI for considering the orange crop
for insurance coverage.
For four components i.e. ‘ban on illegal money lending’, ‘agro based
industries’, ‘joint farming of cotton’ and ‘helpline for farmers’ of the GOM
package no fund allocation was made, not even for their publicity.
Chapter II – Conceptualisation of packages
7
In the survey commissioned by Audit it was observed that 75 per cent
respondents were not aware about the relief from illegal money lenders and
82 per cent respondents were not aware about the helpline for farmers.
2.3 Base line data not used for package implementation
In order to ascertain the level of distress amongst the farmers and to initiate
preventive measures to check farmers’ suicides, a comprehensive door to door
survey of 17.64 lakh farmers was conducted (June 2006) by teams consisting
of Talathi, Gram Sevaks and Agriculture Assistants. The survey identified
13.48 lakh farmers under distress and 4.34 lakh farmers were categorised
under category of maximum distress, on the basis of demand for agriculture
inputs, loan, etc. However, the list of such farmers in distress was neither
shared with nor insisted upon as base line data by the implementing agencies
(Agriculture, Animal Husbandry and Dairy Development Departments).
Implementing agencies for various components selected beneficiaries on the
basis of applications invited by them.
Selection of beneficiaries thus had no relation to the departmental survey
conducted for assessment of distress. As a result, prioritisation of relief and
rehabilitation works considering the distress level of the farmers could not be
ensured.
The Chief Secretary accepted (November 2007) that the survey data should
have been used in deciding the priorities in disbursement of assistance and
directed the Director General, VNSSM, Amravati to issue appropriate
instructions in this regard.
ERA survey indicated that 85 per cent respondents were not approached by
any Government official for departmental survey.
2.4 Incorrect accounting of expenditure
No separate scheme/sub-head/object head was opened by the State in its
budget for providing funds and incurring expenditure inspite of specific
request made (February 2007) by the Accountant General. (A&E)-II,
Maharashtra, Nagpur. As a result, consolidated expenditure could not be easily
correlated with the actual amount booked in the State’s accounts. A total
amount of Rs 2275.30 crore was booked as expenditure in the State’s account
for the Capital Formation Fund (CFF) paid during 2005-07, whereas actual
expenditure shown by Cotton Federation the implementing agency for refund
of capital formation fund during the period was Rs 875.53 crore.
The Principal Secretary, Co-operation accepted (November 2007) the
difference in the figures of expenditure reflected in the Appropriation
Accounts and the figures reported by the Director General, VNSSM,
Amravati. The Secretaries/Principal Secretaries of the line departments also
agreed (November 2007) to furnish the details of amount actually drawn and
Survey report
indicated that
85 per cent
farmers were
not
approached by
Government
officials
Audit Report (Farmers’ packages) for the year ended 31 March 2007
8
expenditure actually incurred as of March 2006 and March 2007, which was
not received as of January 2007.
The amount of expenditure furnished by VNSSM, Amravati in May/June 2007
and November 2007 and the implementing departments differed in the
following components.
(Rupees in crore)
Sr.
No.
Name of component Expenditure as of
March 2007
reported by VNSSM
in the month of
Expenditure as of March 2007 as
reported by the implementing
agency in the month of
May 2007 June 2007 November 2007
1 Compensation to
cotton growers
130.43 129.46 130.12
2 Assured irrigation 613.70 569.92 617.62
3 Organic farming 9.15 9.89 9.59
4 Vidarbha Panlot
Mission
17.04 16.51 17.63
Thus, there were differences in the figures of expenditure in four components
which have not been reconciled by VNSSM even after a lapse of eight months.
The expenditure reported for Appropriation Accounts in respect of
compensation to cotton growers as booked in accounts was Rs 122.18 crore
(March 2007). The Principal Secretaries of the respective departments agreed
to verify the figures.
A few instances of discrepancies in reporting expenditure figures are as under:
􀂾 The VNSSM reported expenditure of Rs 9.22 crore against Rs 6 crore
declared for community marriage, whereas expenditure reported for
Appropriation Accounts was Rs 9.74 crore. Commissioner of Women
and Child Welfare, Pune stated (May 2007) the same to be of
Rs 12.78 crore, six DWCDOs reported Rs 11.86 crore. Thus, there was
lack of accuracy in reporting expenditure figures.
􀂾 In three districts (Amravati, Wardha and Yavatmal) out of
Rs 6.69 crore received upto March 2007, Rs 3.14 crore was utilised. Of
the balance, Rs 2.29 crore was deposited in 8443 –Civil Deposits and
was lying idle. The expenditure was thus inflated by Rs 2.29 crore.
Secretary, Women and Child Welfare stated (November 2007) the funds for
community marriage were kept in Civil Deposits as per instructions of
Collector. Reply indicated that the amount was withdrawn to avoid lapse of
grant, without assessing the actual requirement of funds and there was no
proper reporting of expenditure.
􀂾 Further, out of Rs 16.36 crore released by GOI for subsidiary income
component during 2006-07, Maharashtra Livestock Development
Board (MLDB) utilised Rs 4.44 crore (27 per cent). Out of
Rs 14.53 crore released by GOM utilisation was Rs 9.73 crore (67 per
Expenditure
was inflated by
Rs 2.29 crore
Chapter II – Conceptualisation of packages
9
cent). Unspent amount of Rs 4.80 crore was thus lying with MLDB as
of December 2007.
2.5 Contradiction of norms of GOM and GOI
DCC Banks and Rural Co-operative Societies attached to the DCC Banks in
six DDRCS charged interest at 17 per cent per annum instead of 14 per cent in
four lakh accounts of farmers involving principal amount of Rs 514.64 crore,
resulting in excess claim of interest at three per cent per annum. Exact amount
of penal interest included in the claim was not readily available with the
banks. However, penal interest at three per cent for a year works out to
Rs 15.44 crore.
Principal Secretary, Co-operation stated (November 2007) that as per the GOI
package, interest on over due loan was the entire interest including penal
interest; hence banks were allowed to reimburse the amount of penal interest
also.
The reply was not tenable as the GOM clarified (February 2006) that penal
interest charged by the Banks on outstanding loans would not be considered
for waiver of interest. It would be appropriate that contradiction of orders
issued by the GOM and GOI may be resolved and a common view taken in
this matter.
2.6 Programmes not consistent with local needs
For feed and fodder supply and establishment of fodder block units,
Rs 6.12 crore was received (October – December 2006) from GOI under the
component ‘subsidiary income’. The amount remained unutilized as of March
2007. Similarly, GOM issued (May 2006) instructions for purchase of two
mobile vans for each district to provide medical assistance to the animals
under the GOM package component ‘Agriculture allied activities’. Mobile
vans were not purchased in any of the six districts.
The Secretary, AHDD & F stated (November 2007) that establishment of
fodder block units was unviable and GOI have already approved the alternate
feed concentrate and though providing mobile van was envisaged in the
package, the same were not required during implementation of the component.
This clearly indicates inclusion of components without assessing local needs.
2.7 Conclusion
Components had certain deficiencies and left critical areas uncovered which
impacted their effectiveness. Seven components included in the packages were
available for the entire State. GOI Packages declared were overstated to the
extent of Rs 239 crore. Base line data was not used for package
implementation. Authenticity of reported expenditure was doubtful in the
absence of proper classification in accounts. VNSSM, the monitoring agency
Penal interest
charged by the
DCC banks as
per norms of
GOI package
was not
admissible
under GOM
packages
Programme on
fodder supply
was included
in GOI
package
without
assessing the
local needs.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
10
failed to reconcile the differences in expenditure figures compiled by it and
those reported by the implementing departments.
2.8 Recommendations
• Available data needs to be shared across the implementing departments
for the purpose of identification of beneficiaries as well as for
allocation of funds amongst various components.
• Deficiencies adversely impacting the components need to be removed.
• Distinct account head for the expenditure specific to the package needs
to be opened.
Government accepted the above recommendations during exit conference
(November 2007).
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CHAPTER III: IMMEDIATE RELIEF MEASURES
Seven components were included in the packages for immediate relief to the
distressed farmers. The components and the implementing agencies were as
under:
Name of component Name of implementing department
Debt relief to farmers (GOM & GOI)
Refund of Capital Formation Fund
(GOM)
Ban on illegal money lending (GOM)
Co-operation Department
Compensation to cotton growers
(GOM)
Agriculture Department
Immediate relief in suicide cases
(GOM)
Assistance for health and education
from PMNRF (GOI)
Relief and Rehabilitation wing
Community Marriages (GOM) Women & Child Welfare Department
3.1 Debt relief to farmers
GOM decided (December 2005 and February 2006) to waive interest on crop
loans upto Rs 25,000 taken by farmers of six districts from all DCC banks,
Nationalised banks and Rural banks. Loans outstanding as on 30 November
2005 were only considered for interest waiver. The loans were to be
rescheduled at nine per cent interest per annum and repaid in three equal
annual installments with a two years moratorium period. Amount of penal
interest was to be excluded from the amount of interest waived.
In the GOI package (July 2006), it was decided to waive the interest on all
agricultural loans over due as on 30 June 2006 and reschedule the loans. No
processing fee was to be charged while rescheduling the loans. The
expenditure on waiver of interest was to be shared equally by GOM and GOI.
Amount declared in the package for this component was Rs 712 crore.
However, total interest claims by the banks were for Rs 824.99 crore. GOM
released its share (Rs 356 crore) to Joint Registrar, Co-operation Amravati for
reimbursement of claims of the banks while GOI share was reimbursed to
various banks by NABARD and RBI directly.
3.1.1 Banks claimed interest without extending fresh loans
Out of 17.64 lakh farmers in six DDRCS, 9.29 lakh accounts/cases of loan
having outstanding principal amount of Rs 1369.85 crore were proposed to be
rescheduled after waiver of interest. However, fresh loans of Rs 673.88 crore
(49 per cent) were given in 4.84 lakh cases.
Principal Secretary, Co-operation stated (November 2007) that 1,92,745
borrowers were landless farm workers who did not require any crop loan,
Fresh loans
were given to
4.84 lakh
farmers out
of 9.29 lakh
farmers
Audit Report (Farmers’ packages) for the year ended 31 March 2007
12
26,400 borrowers had died, 25,129 had sold land, 21,125 had left villages and
30,715 did not require any loan. In 62,807 cases there were disputes or lack of
essential documents while in 85,975 cases the farmers had long term loans.
Waiver of interest in all these cases did not help the families of the farmers
concerned in income augmentation since the loan was not rescheduled.
Further, Government waived interest of 1,92,745 farm workers though the
packages did not envisage assistance to the borrowers who were not farmers.
As per ERA survey, 75 per cent respondents were not aware about interest
waiver and 44 per cent said that banks insisted on repayment of earlier loan.
Eight per cent farmers stated that banks demanded fees for processing loans
and 67 per cent stated that banks asked for mortgage for loan.
3.1.2 Excess claim of interest by the banks
A few interesting instances noticed relating to the excess claim of interest by
banks are as under:
􀂾 As per the guidelines of the packages, interest more than principal
should not be charged for Co-operative loans. Seven branches of
DCC bank test checked, however, claimed interest of Rs 5.13 crore
as against principal of Rs 3.19 crore resulting in excess claim of
interest of Rs 1.94 crore.
􀂾 Thirty five test checked branches of Nationalised banks/Cooperative
banks wrongly waived interest of Rs 19.49 crore on
26435 written off loan accounts and Rs 9.46 crore on 14,587
accounts of loan disbursed under other Centrally Sponsored
Schemes.
􀂾 Eleven branches of Nationalised / Co-operative banks waived
interest of Rs 12 lakh on 328 accounts where loans were taken for
purchase of trucks, jeeps, shares of spinning mills, etc.
􀂾 Two branches of Nationalised/Co-operative banks claimed excess
interest of Rs 3 lakh on 110 current loan cases due to application of
incorrect rate of interest and inclusion of current cases of loan.
Principal Secretary, Co-operation agreed (November 2007) to refer to
GOI/NABARD the cases of inadmissible claims of interest claimed / waived
by the respective branches of Nationalised/ Co-operative Banks and review the
cases of excess interest of Rs 3 lakh claimed by two banks and Rs 1.94 crore
by the DCC banks.
3.2 Refund of Capital Formation Fund
This component of the GOM package was applicable throughout the State.
Under the Maharashtra Raw Cotton (Procurement, Processing and Marketing)
(MRCPPM) Act 1971, the Maharashtra State Co-operative Cotton Growers
Federation (Federation) was appointed as the sole agent for procurement,
Nationalised
banks and Cooperative
banks
wrongly waived
interest of
Rs 28.95 crore
Chapter III - Immediate relief measures
13
processing and marketing of cotton from 1972. The Act provided creation of
the Capital Formation Fund (CFF) for continuous operation of the scheme and
repayment of the CFF along with interest after lapsing of the Act. The Act
lapsed on 30 June 2001.
The Federation had collected Rs 216.91 crore out of the guaranteed price paid
to the farmers’ between 1981-82 and 1992-93. No deduction was made for the
CFF from the farmers after 1992-93. However, the amount collected under
CFF was not refunded to the farmers till it was included as a component in the
package (GOM).
Between February 2006 and March 2007, GOM released Rs 875.53 crore to
the Federation for refund of the CFF. The amount was paid to the Federation
as loan. Of these, Rs 704.48 crore was refunded to farmers as of March 2007.
In the six districts, out of Rs 405.15 crore released by GOM, Rs 396.59 crore
was refunded to the farmers and Rs 8.56 crore was lying undisbursed with the
Federation as of March 2007.
Principal Secretary, Co-operation stated (October 2007) that due to heavy
losses to the Federation, the amount of CFF could not be refunded to the
cotton growers and Government sanctioned loan to the Federation for refund
of CFF even though they had no responsibility to take over the liability of the
Federation.
The reply was not tenable as the funds provided for refund of the farmer’s
share in the CFF were not specific for the six selected districts. Further,
lending to Federation who had no capacity to repay, implied misclassifying
‘expenses’ as ‘investments’ in Government accounts.
3.2.1 Payment of compound interest on Capital Formation Fund
As per Rule-11 (3) (i) of MRCPPM (Capital Formation Fund) Rules 1984, the
interest earned on CFF shall be distributed in proportion of the amount of the
individual grower’s standing contribution in the CFF and it shall be credited to
the individual account of the farmers. As per the rules, simple interest was to
be calculated at 12 per cent per annum on six monthly basis i.e. July to
December and January to June and the interest was to be paid in cash to
concerned individual cotton growers as per his share of CFF.
In six test checked districts, the amount of CFF with the Federation was
Rs 96.71 crore upto 1992-93 on which compound interest upto June 2004, i.e.
Rs 308.72 crore was paid as against simple interest at 12 per cent per annum
i.e. Rs 148.57 crore. Thus, excess interest works out to Rs 160.15 crore.
Principal Secretary, Co-operation stated (November 2007) that decision to pay
compound interest on the amount of CFF was taken by the Government in
January 1991. The reply was not tenable as the Government letter dated 16
January 1991 was about 12 per cent simple interest and not compound
interest.
Farmers’ share in
Capital
Formation Fund
was refunded
only after it was
included as a
component in the
GOM package
Compound
interest was
allowed on CFF
instead of simple
interest. Excess
interest paid was
Rs 160 crore.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
14
Further, records of five2 test checked Zonal offices of the Federation showed
that 275 complaints were received about non-distribution of cheques
amounting to Rs 9.49 lakh being the farmers’ share of CFF. The Zonal offices
had taken up the matter with the firm which printed the cheques as there were
variations in the names of the beneficiaries. This resulted in denial of
immediate relief to 275 farmers even after lapse of nearly two years.
Principal Secretary, Co-operation stated (October 2007) that out of 275
complaint cases, 96 cases involving Rs 5.90 lakh (with interest) were solved
and Federation has been instructed to solve the remaining complaints.
As per the ERA survey report, 65 per cent respondents confirmed receipt of
CFF.
3.2.2 Denial of benefits to farmers
Two spinning mills of the Amravati District collected Rs 14.34 lakh from
5500 farmers upto 1991-92 towards contribution to the Capital Formation
Fund but did not deposit the same with the Cotton Federation. Consequently,
cheques of Rs 1.10 crore could not be issued to 5500 farmers.
Principal Secretary, Co-operation agreed (November 2007) to pay the amount
of CFF payable to the farmers and recover the same from the liquidators of the
spinning mills.
3.3 Ban on illegal money lending
Government of Maharashtra declared (December 2005) that all farmers, who
obtained loan from the unregistered money lenders have to treat themselves as
free from that loan. This was to be publicised. It was also to be ensured by the
Co-operation Department that licensed money lenders charged interest as per
the money lending Act. Government issued necessary orders in
February 2006.
No funds were allocated by GOM for this component. In six test checked
DDRCS offices, no expenditure was incurred even on publicity of the
Government decision. Department thus, failed to address the distress of
farmers in the area, as was declared through the package.
Principal Secretary, Co-operation stated (October 2007) that DDRCS has got
no money to spend on publicity. Publicity was, however, made by the
departmental officers with the help of District Co-operative Banks.
ERA survey showed that 75 per cent respondents were unaware of this relief
which indicated that the publicity was not adequate and effective.
3.3.1 Action initiated against illegal money lenders
DDRCS and Assistant Registrar of Co-operative Societies (ARCS) in the six
districts received 2867 complaints in connection with sale deed of immovable
2 Amravati, Akola, Khamgaon, Wani and Yavatmal.
Two hundred
seventy five
farmers did not
receive benefits
due to variations
in names printed
on cheques
Chapter III - Immediate relief measures
15
property by the money lenders as of March 2007. Of these, 2018 cases were
investigated and 849 cases (42 per cent) were pending for investigation as of
October 2007.
The action initiated against the illegal money lenders in most cases led to
orders under Section 13-B3 of the Bombay Money Lending Act being passed
by the respective ARCS.
In Akola and Amravati Districts in 43 cases involving land costing
Rs 32.96 lakh of 46 farmers, the ARCS decided (March 2006) the executed
sale deed as a matter of illegal money lending and declared the farmers free
from debt. However, the farmers did not get the intended benefit as Bombay
High Court, Nagpur Bench, in eighteen writ petitions filed by money lenders,
passed orders (October 2006) setting aside the orders passed by the ARCS
under Section 13-B of the Act and restrained authorities from passing any
orders under Section 13-B of the Act regarding possession of immovable
properties purchased through registered sale deeds. Government neither
appealed against these orders (in the Supreme Court) nor took any remedial
action like amendment of the relevant Acts to secure interest of the indebted
farmers, as of September 2007. Consequently, the affected farmers did not get
the intended benefit of the Government decision of December 2005.
Principal Secretary, Co-operation agreed (November 2007) that limitations of
law which emerged from the decision of the hon’ble High Court would be
looked into while amending the Act in future.
3.4 Compensation to cotton growers
Mention was made in paragraph 4.1.1 of the Report of the Comptroller and
Auditor General of India for the year ended 31 March 2005 of the damage to
orange crop due to scanty rain and depletion of water table during the
preceding three to four years in orange growing areas of Vidarbha (which
included some of the districts covered by the package). Instances of payment
of compensation to ineligible farmers were also brought out in this paragraph.
Similar omissions were noticed while compensating cotton growers as detailed
below:
Cotton growers throughout the State suffered losses during 2005-06 due to
incessant or scanty rains in various parts of the State, followed by shortfall in
cotton yield due to diseases. To compensate the cotton growing farmers,
Government, as a special case, decided (February 2006) to pay compensation
of Rs 1000 per hectare (ha.) (subject to a minimum Rs 500 and maximum of
2 ha.). The GOM package declared Rs 134 crore for this purpose.
The payment was to be made by the District Superintending Agriculture
Officer (DSAO) by cheques through DCC banks. A data base of land records
was available in the Tahsildar’s office, through which computer generated
3 The Section provides for disposal of property pledged with illegal money lender
Department
acted without
proper legal
mandate
Audit Report (Farmers’ packages) for the year ended 31 March 2007
16
7/124 document of individual farmer was issued upon charging fees. Instead of
using same database to generate the list of eligible farmers, the Agriculture
Department paid compensation on the basis of lists prepared by talathis in the
Revenue Department.
Principal Secretary, Agriculture, confirmed the facts and stated that it was
usual practice to pay compensation on the basis of information from revenue
officials.
Further, Maharashtra Remote Sensing Application Centre (MRSAC), Nagpur
had estimated (2005-06) the district-wise area in which cotton was cultivated.
Area under cotton cultivation was also depicted in the Crop Cultivation Report
prepared by the DSAO and Agriculture Development Officer (ADO), ZP.
However, DSAOs paid compensation for area of cotton cultivation in each
district based on the lists prepared by the talathis.
It was noticed that the total area reported by the Collectors for payment of
compensation was in excess by 2,66,005 ha. than the area reported by
MRSAC and 1,91,326 ha. more than that reported by the DSAOs.
In 13 test-checked talukas the percentage variation in the area under cotton as
per Crop Cultivation Report (CCR) and the lists prepared by the Talathis of
Revenue Departments ranged between 00.47 and 32.03. This resulted in
excess payment of Rs 9.56 crore in respect of 95190 ha. of land as shown in
Appendix VIII (Page 42).
Principal Secretary, R&R stated that action would be taken where variations in
the area were noticed.
ERA survey showed that 46 per cent respondents reported the receipt of
amount on account of cotton compensation.
3.4.1 Compensation not disbursed for want of funds
Scrutiny of records in TAO, Amravati revealed that 224 eligible farmers were
deprived of the compensation of Rs 2.14 lakh due to non availability of funds.
Principal Secretary, Agriculture agreed (November 2007) to release the
necessary funds to the implementing agencies concerned.
3.4.2 Retention of money out of Government account
In 18 selected talukas, Rs 39.11 crore was received and deposited in various
DCC banks in 2006-07 for crediting the amount to the accounts of the farmers
concerned. In seven5 talukas an amount of Rs 53.29 lakh was lying
undisbursed with the banks and remained out of Government accounts as of
May 2007.
Principal Secretary, Agriculture (November 2007) accepted the facts and
stated that unspent amount was finally refunded to Government. It was also
4 Format in which land records are maintained.
5 Chandur Bazar, Chikhaldara, Mehkar, Morshi , Motala, Lonar and Pusad
Reports of three
departments
regarding area
under cotton
cultivation were
different
Area reported by
Collectors for
payment of
compensation to
cotton growers
was in excess of
the area
calculated as
estimated by
MRSAC
Chapter III - Immediate relief measures
17
agreed that undisbursed amounts in other talukas would also be ascertained,
and credited to the Government account (November 2007).
3.5 Grant of immediate relief in suicide cases
Government decided (December 2005) to pay assistance of Rs 1 lakh to the
legal heirs of the farmers who committed suicide due to crop failure and
indebtedness due to outstanding crop loan and interest thereon. Government
further clarified (February 2006) that any member of family of the farmer
would also be considered for relief assistance under this component.
At the time of declaration of package (GOM) specific amount for this was not
declared. Prior to the package, relief in similar cases was being paid through
CM’s relief fund. However, information regarding the rate/amount of ex-gratia
was not made available to Audit (November 2007). In one Public Interest
Litigation (PIL), Mumbai High Court directed (May 2006) to consider
increase in this amount of Rs 1 lakh. Government was yet to act on this
direction conclusively (November 2007). A graph showing number of suicide
cases in all six districts from 2001-02 to 2006-07 is as below:
The graph indicates increase in number of suicides in six districts despite
declaration of the packages. The average number of suicides in the first two
Suicides in six districts of Vidarbha
0
200
400
600
800
1000
1200
1400
1600
suicides
Apr to June 9 19 37 50 71 312 283
July to Sept. 20 25 33 235 102 385 325
Oct to Dec 13 37 32 112 200 412
Jan to Mar 24 41 44 58 339 305
Total 66 122 146 455 712 1414 608
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08
Before the Package
GOM
Package
(Dec2005)
G O I
Package
(June2006
)
Audit Report (Farmers’ packages) for the year ended 31 March 2007
18
quarters of 2007-08 declined marginally compared to the respective quarter of
previous year, yet the numbers were significantly higher than the number of
suicides in corresponding quarters of the years 2001-02 to 2005-06.
3.5.1 Delay in payment of relief assistance
As per the Government instructions (January 2006), the decision of payment
of relief assistance was to be taken within a period of 15 days by a Committee
headed by the District Collector. In 11 talukas in four districts there were
delays ranging from 10 to 323 days in 72 out of 199 eligible cases (36 per
cent), as detailed below:
Name of
the district
Taluka Total number of
eligible suicide cases
Number of
delayed payment
cases
Delay in number
of days
Akola Murtizapur 32 8 11 to 98
Deulgaon raja 16 9 16 to 98
Jalgaon Jamod 11 3 16 to 67
Lonar 5 2 31 to 81
Malkapur 8 1 11
Mehkar 9 8 19 to 64
Buldana
Motala 13 3 16 to 52
Ghatanji 46 6 25 to 323 Yavatmal
Pusad 9 7 12 to 19
Washim Karanja 36 17 10 to 100
Washim 14 8 10 to 72
Total 199 72
Director General, VNSSM agreed to investigate the inordinate delays and fix
responsibility (November 2007).
3.5.2 Relief paid without ensuring eligibility
In Yavatmal District, 15 cases6 of suicide were considered as eligible for
payment of relief (Rs 15 lakh) even though the post-mortem (PM) report
indicated the probable cause of death as ‘may be due to consumption of
poison’ and suggested (July 2004 to February 2007) for examination of
viscera by chemical analysis. There were no records to show that viscera were
sent for chemical analysis in any of these cases.
In 16 cases (Yavatmal: 11 and Wardha: 5), Rs 16 lakh was paid without
obtaining PM reports and / or police panchanama in support of the cases
reported as suicides.
The Director General, VNSSM directed (November 2007) the Collector to
investigate reasons for not obtaining PM reports in these cases. Collector,
Yavatmal stated (November 2007) that PM reports in all cases have been
obtained and would be sent to Audit. However, the same were not received as
of January 2008.
3.5.3 Relief paid on wrong criteria
In Ghatanji Taluka three cases of deaths out of 46 eligible cases of deaths
caused due to consumption of poison in July 2001, March 2003 and July 2003
6 Pusad-8, Ghatanji-7
Payment of
relief was
delayed by 10
to 323 days in
suicide cases
In suicide
cases the
Collector,
Wardha
decided
eligibility for
immediate
relief without
post-mortem
report
Chapter III - Immediate relief measures
19
were considered (May 2006) by District Level Committee headed by District
Collector for relief assistance (Rs 3 lakh) despite report from the
Superintendent of Police that the suicide was due to ill health or family
disputes.
Director General, VNSSM agreed (November 2007) to examine the three
cases in Ghatanji and to avoid recurrence of similar cases in future.
3.5.4 Assistance kept in abeyance
In the test checked talukas of Karanja (Lad) and Washim, payment of
assistance in 28 suicide cases registered between January and May 2007
(Rs 28 lakh) was held in abeyance by the Collector, Washim on the plea that
the deceased farmers had no loan outstanding on the date of their death.
Director General, VNSSM, Amravati stated (November 2007) that orders to
regularise the withheld cases have been issued to Collector, Washim. The fact,
however, remains that there was delay in payment of immediate relief to the
family of the deceased farmers.
3.6 Community marriages
The GOM package provided financial assistance of Rs 10,000 (in kind) each
for marriage of daughter of a farmer, performed under Community Marriage
Programme. Similarly, grant of Rs 1000 per couple was also payable to the
arranging NGO. The terms and conditions (February 2006) stipulated that the
bride and bridegroom were required to be domiciled in Maharashtra and ration
card, school leaving certificate or other documents were to be considered as a
proof of the fact that bride is a daughter of a farmer. Marriage certificates were
also to be issued to the couples by the District Women and Child Welfare
Officer (DWCDO) and the Registrar of marriage immediately. GOM released
Rs 14.23 crore during 2005-07 for this component, of which Rs 9.22 crore was
spent.
In 18 selected talukas, an expenditure of Rs 4.43 crore was incurred during
2005-07 on performing 4027 marriages under community marriage
programme wherein identification of the beneficiary was done only on the
basis of school leaving certificate of the bride, without any valid proof of her
being daughter of a farmer or farm labourer.
In six districts, out of 10,786 community marriages performed during
2005-07, marriage certificates were not issued in 8,329 cases (77 per cent) by
DWCDO and the Registrar, though prescribed in Government order. Of these,
marriage certificates in 3,028 cases (Amravati) were issued by an NGO in
contravention of Government orders.
Secretary, Women and Child Welfare agreed to look into the lacunae and
stated that specific instructions would be issued to confirm the eligibility of
beneficiary and to take necessary steps to ensure issue of marriage certificates
within one month after the marriage.
Assistance of
Rs 4.43 crore
was extended
without
ensuring
eligibility of the
beneficiaries
Marriage
Certificates
were not
issued in
77 per cent
cases
Audit Report (Farmers’ packages) for the year ended 31 March 2007
20
ERA survey showed that less than one per cent respondents had applied for
participation in community marriage scheme. Of them, 30 per cent reported
having married their daughters in community marriage programme.
3.7 Conclusion
Short term measures were aimed at providing immediate relief to the farmers
in distress. Implementation of these components was saddled with delays in
payment of the assistance. ERA survey showed that 75 per cent respondents
were not aware of interest waiver. The banks wrongly waived the interest of
the loans written off and the loans given on other Centrally Sponsored
Schemes. Relief declared by the Government regarding illegal money lending
did not get adequate publicity. Farmers did not get the benefit endorsed in the
package consequent on passing of the order of hon’ble High Court.
Expenditure was incurred on community marriage without any valid proof for
eligibility of the beneficiary and marriage certificates were not issued in many
cases.
3.8 Recommendations
• Inadmissible interest claimed by the banks needs to be recovered.
• Money Lending Act may be re-examined in the light of decision of
hon’ble High Court.
• Assistance for community marriage should be extended only to the
eligible couples.
Government accepted the above recommendations during exit conference
(November 2007).
=====
=====
=====CHAPTER IV: LONG TERM MEASURES
The packages contained eight programmes which were long term measures for
alleviating farmers’ distress. The components and the implementing agencies
were as under:
Name of component Implementing Department
Assistance to farmers for increase in
agriculture production (GOM)
Agriculture Department
Agricultural allied activities for supplementary
income (GOM/GOI)
Animal Husbandry and Dairy
Development Department
Micro irrigation (GOI) Agriculture Department
Assured irrigation (GOI) Water Resources and Water
Conservation Department
Seed replacement and cropping intensity
(GOI)
Agriculture Department
Agriculture Insurance Scheme (GOM) Agriculture Department
Vidarbha Panlot Mission (GOM) Water Conservation Department
Other components (GOI/GOM) Agriculture, Co-operation and
Water Conservation Departments
4.1 Assistance to farmers for increase in production
GOM decided (February 2006) to provide agriculture inputs and implements
to 60,000 selected farmers from six districts of Vidarbha to assist the
economically weaker farmers. Under this component, assistance of Rs 25,000
each (with 50 to 100 per cent subsidy) was to be provided within a period of
three years in the form of seeds, fertilizers, insecticides, sprayers, land
development and water conservation. Conditions of eligibility for these
benefits included maximum land holding not exceeding six ha. and annual
income below Rs 20,000. District level Committee headed by District
Collector was to select the beneficiaries and the Taluka Agriculture Officer
was to implement the component.
Out of Rs 150 crore allocated for three years, Government released
Rs 85.40 crore during 2005-07 as reported by the Agriculture Department. Of
these, Rs 49.99 crore was spent as of March 2007. Under utilisation was
mainly due to release of funds at the fag end of the year (29 and
30 March 2007) by the Commissioner of Agriculture, Pune to the DSAOs.
Principal Secretary, Agriculture admitted (November 2007) that unspent
amount was transferred to Agriculture Technology Management Agency
(ATMA) of which Rs 7 crore was lying unspent with ATMA as of
September 2007.
Late release of
funds led to
grants
remaining
unspent
Audit Report (Farmers’ packages) for the year ended 31 March 2007
22
4.1.1 Selection of beneficiaries
The programme envisaged selection of 10,000 farmers from each of the six
districts. The beneficiaries were to be selected from the economically weaker
farmers giving priority to poorest and most backward class farmers.
In 18 talukas, out of 29,200 farmers who applied for supply of inputs and
implements, 16,577 farmers (57 per cent) were provided benefits as of
March 2007. As package components were for reducing the agrarian distress,
short coverage of 12,623 beneficiaries despite availability of funds needs
detail analysis.
Principal Secretary, Agriculture stated (November 2007) that the target of
60,000 farmers was set on ad-hoc basis. Hence, all farmers could not be
covered.
The reply indicated inadequate assessment of required inputs coupled with
ad-hocism in determining number of farmers targeted under this component.
Further, in Seloo taluka (District Wardha) 586 farmers applied for supply of
inputs/implements to Taluka Agriculture Officer against the target of 869.
District Level Committee headed by Collector, Wardha selected 129 farmers
from the most backward class farmers. Of these, 34 farmers had land holding
of two ha. and above, whereas 331 farmers (not from most backward class),
who had land holding below two ha., were not selected inspite of they being
poorer than those selected. Similarly, in seven other talukas of the District,
selection of the beneficiaries was made without giving priority to the poorest
farmers.
During exit conference (November 2007), the Chief Secretary directed the
Principal Secretary (R&R) to obtain a report from the present District
Collector and to take appropriate action.
4.1.2 Dishonoured cheques
Scrutiny disclosed that the TAO, Karanja, (Lad) (District Washim) had
issued (July 2007) cheques of Rs 15,000 each to 349 beneficiaries for
purchase of a pair of bullocks (total amount Rs 52.35 lakh) as against the
target of 110 beneficiaries fixed by the District Level Committee. Out of
349, nine cheques were dishonoured on 14 August 2007 as the TAO issued
cheques without confirming the balance in the bank account. The cheques
were subsequently encashed on 31 August and 01 September 2007. The
matter needs investigation.
Principal Secretary, Agriculture stated (November 2007) that the Taluka
Agriculture Officer had been suspended (November 2007).
4.1.3 Non-distribution of inputs/implements
Out of 18 test checked talukas, inputs and implements worth Rs 1.33 crore
were lying undistributed in eight talukas.
Forty three per
cent of the
needy farmers
were not
provided the
agricultural
inputs and
implements
Chapter IV – Long term measures
23
Principal Secretary, Agriculture agreed (November 2007) to distribute the
balance material in next three months and also agreed to issue instructions to
avoid purchase of inputs without assessing actual requirement.
4.2 Agricultural allied activities for supplementary income
Providing supplementary income avenues to the farmers through agricultural
allied activities was a component in the packages. For this component,
Rs 30 crore (GOM) and Rs 135 crore (GOI) spread over three years were
earmarked. Maharashtra Live Stock Development Board (MLDB), Akola was
the nodal agency for implementing this component.
As per Agriculture Department, out of total Rs 30.89 crore released for the
component, total expenditure incurred was Rs 14.17 crore as of March 2007.
Out of the unspent balance of Rs 16.72 crore, Deputy Commissioner, MLDB,
Akola deposited (October and December 2006) Rs 5 crore with two
nationalised banks as fixed deposit and earned interest of Rs 14.52 lakh. The
amount remained unaccounted for as of March 2007.
The Secretary, AHDD&F agreed (November 2007) to ensure the accountal of
the interest earned out of the funds parked in the banks.
4.2.1 Excess payment of subsidy
As per the norms prescribed by GOM (February 2006), the financial limit of
the project cost for the Self Help Groups (SHGs) of Above Poverty Line
(APL) beneficiaries was Rs 2 lakh and amount of subsidy payable to each
APL group was to be restricted to Rs 1.50 lakh.
In 13 test checked talukas, subsidy of Rs 2.64 crore was paid to 105 SHGs
instead of Rs 1.57 crore admissible as per the norms, resulting in excess
payment of Rs 1.07 crore during 2005-2007 (Appendix IX – Page 43).
Secretary, AHDD&F agreed (November 2007) to investigate the matter.
4.2.2 Deviation from norms
In Yavatmal District, subsidy of Rs 1.86 crore was paid on purchase of 1470
animals to 735 beneficiaries at a time between December 2006 and
March 2007. Similarly, in Buldana and Wardha Districts, subsidy of
Rs 2.66 crore was paid on purchase of 2138 animals between a gap of one to
four months for supply to 1069 beneficiaries. This was contrary to the
guidelines issued by GOI for providing a gap of six to seven months before the
second purchase.
The Secretary, AHDD&F stated (November 2007) that revised norms with
reasonable relaxation to GOI guidelines would be framed in view of local
conditions and strictly observed in future.
Excess subsidy
was paid to
Above Poverty
Line SHGs
Audit Report (Farmers’ packages) for the year ended 31 March 2007
24
4.3 Micro irrigation
For micro irrigation, Rs 26 crore per year for three years was declared
(August 2006) in the package (GOI). The component was applicable to all
districts in the State for horticulture crops upto 2005-06. Out of Rs 20.67 crore
released during 2006-07 the total expenditure incurred was Rs 20.62 crore as
of March 2007. A few interesting points noticed were as under:
(i) Under the component, drip and sprinkler sets were provided at 50 per
cent subsidised cost. The subsidy was to be shared between Central and State
Governments in a ratio of 80:20. The scheme was meant for the farmers
having electric connection and source of water for irrigation and to be
implemented through Sub-Divisional Agriculture Officer (SDAO).
In 18 test checked talukas, drip irrigation sets costing Rs 10.86 crore were
provided to 1878 farmers at an average cost of Rs 57,847 per set. Each farmer
was to bear 50 per cent average cost being Rs 28,924, which was a large
amount for a poor farmer.
The Principal Secretary, Agriculture stated (November 2007) that the matter
was reported to GOI in September 2006 for increasing the subsidy.
ERA survey showed that about two per cent respondents had applied for
sprinklers/drip irrigation facilities.
(ii) As per the norms prescribed by Commissioner of Agriculture, Pune,
the average distance for sowing of cotton of various qualities works out to less
than 1 metre (m) X 1 m. In 53 cases involving expenditure of Rs 26.81 lakh in
Amravati Tahsil and Morshi Tahsil of Amravati District showed that in
19 cases the distance of sowing cotton was wrongly shown as 1.5 m X 1.5 m.
This resulted in excess payment of subsidy by Rs 1.55 lakh. The Principal
Secretary, Agriculture (November 2007) agreed to look into the
appropriateness of subsidy as prescribed in the guideline.
(iii) In Amravati (one case) and Murtizapur taluka (four cases) subsidy of
Rs 4.22 lakh was paid on the basis of unsigned form 7/12. In reply
(October 2007), the SDAO/Tahsildar provided wrong spot verification
report/incorrect 7/12 to Audit. Principal Secretary, Agriculture agreed
(November 2007) to investigate and take action in the matter.
4.3.1 Pending proposals
In four sub-divisions (Akola, Mehkar, Morshi and Yavatmal) out of 5571
proposals received for subsidy of Rs 6.91 crore, 2841 proposals for
Rs 4.33 crore were pending as of June 2007 for want of funds under the
component, despite availability of unspent amount in other components.
The Principal Secretary, Agriculture stated (November 2007) that all pending
proposals have now been cleared. The fact remains that there was delay in
clearing the proposals.
Changes in
guidelines not
considered for
payment of
subsidy
Proposals
remained
pending for
want of
funds
Chapter IV – Long term measures
25
4.4 Assured irrigation
Assured irrigation was announced as a component of the GOI package for
Rs 2177 crore to create irrigation potential for 1.60 lakh hectares in six suicide
prone districts. Under this component, assistance of Rs 2085.38 crore was to
be provided for eight major, nine medium and 65 minor irrigation projects of
the State, as grant by the GOI under Accelerated Irrigation Benefit Programme
(AIBP). The balance amount of Rs 91.88 crore for 492 minor irrigation
projects of local sector was to be provided as loan from NABARD.
4.4.1 Short release of funds
As per records of Water Resources Department and Vidarbha Irrigation
Development Corporation (VIDC), Nagpur no funds for the proposed projects
were received upto February 2007. Position of Central assistance released
thereafter under AIBP was as below:-
(Rupees in crore)
Type of project Number
of
projects
proposed
under
GOI
package
Grant
required for
proposed
projects
under GOI
Package
during
2006-07
Number
of projects
considered
for
assistance
during
2006-07
Proportionate
grant
required
during
2006-07
Grant
actually
received
Short
receipt of
Central
grant
Major projects 8 489.62 5 273.28 67.48 205.8
Medium projects 77 151.84 5 85.51 48.11 37.4
Minor irrigation
projects to be
funded under
AIBP
228 85.96 22 85.96 55.89 30.07
Total 37 727.42 32 444.75 171.48 273.27
Short receipt of Central assistance of Rs 273.27 crore (61 per cent of GOI
grants required) hampered the envisaged projects in the first year of the
package. It was noticed that the land required for two major projects (Lower
Wardha and Khadakpurna) in the priority list, was not in possession of the
Department.
The Executive Director, VIDC, Nagpur stated (July 2007) that due to time
required for obtaining various clearances, the funds of Rs 273.27 crore were
not released by GOI.
Thus, creating irrigation potential within three years of declaration of package
appears to be difficult.
7 Two medium projects deleted (one due to non-clearance of forest land and other nearing
completion).
8 Forty three Minor irrigation projects were decided to be funded through NABARD.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
26
Delay in execution of project
Government of India revised (December 2006) the eligibility criteria for
funding. According to the revised criteria if the State Government fails to
comply with the agreed date of completion, the amount released is treated as
loan and recovered as per usual terms of recovery of the Central loan. Due to
short release / delayed release possibility of completion of the projects within
the agreed dates is remote. This presents the risk of Rs 2085.38 crore (56 per
cent) of total package amount becoming loan instead of grant.
Government stated (October 2007) that proposals to get the date of completion
of project extended was being submitted to GOI to avoid the possibility of
conversion of grant into loan.
4.4.2 Project estimates for NABARD loan
In the package it was proposed that 492 Minor Irrigation projects (Local
Sector) estimated (July 2006) to cost Rs 91.88 crore would be executed with
the help of loan from NABARD. Proposals in respect of only 319 Minor
Irrigation (MI) projects costing Rs 210 crore (as against Rs 91.88 crore to
cover 492 projects) were submitted to NABARD by Rural Development and
Water Conservation Department. Of these, 134 MI project proposals costing
Rs 74.70 crore were sanctioned (July 2007) by NABARD. Remaining
185 projects were not sanctioned, as they were not technically feasible and
economically viable (July 2007).
The Principal Secretary, Water Conservation stated (November 2007) that out
of 492 schemes, 233 schemes were completed upto March 2007 through State
funds. Out of remaining 259 schemes 195 would be taken up through
NABARD assistance and balance 64 schemes would be completed through
State fund.
The reply was not tenable as NABARD had already rejected (July 2007),
Governments proposals for 185 projects on the ground of being technically
unfeasible and economically unviable. Taking up these projects with State
funds would amount to risking investment with potential failures.
4.5 Seed replacement and cropping intensity
One of the components in GOI package included distribution of seeds to
farmers at a subsidy of 50 per cent subject to a limit of one ha. (of land
holding). Instructions for implementation of seed distribution component were
issued by the Commissioner of Agriculture, Pune on 21 August 2006.
An amount of Rs 180 crore was allotted for this component for a period of
three years. National Seeds Corporation Limited (NSC), New Delhi was the
nodal agency. However, the seed supply was to be done by Maharashtra State
Seeds Corporation (MSSC) as per demand of Agriculture Development
Officer (ADO), Zilla Parishad. Each farmer was to be issued a permit by TAO
One hundred
eighty five minor
irrigation
projects were not
sanctioned by
NABARD on the
ground of
technical
feasibility
Chapter IV – Long term measures
27
for each season, which could be produced at Taluka Kharedi Vikri Sangh
alongwith his share of 50 per cent for purchasing seeds.
4.5.1 Funds lying unutilised
As against Rs 60 crore declared for 2006-07, GOI released Rs 25.46 crore.
The VNSSM showed (April 2007) GOI release as Rs 17.50 crore. The
utilisation certificate of MSSC, Akola, however, indicated (July 2007) that
total value of seed distributed to farmers was Rs 26.57 crore. Excluding
farmers’ share of Rs 13.29 crore in the cost of these seeds, Rs 12.17 crore was
lying unutilised with NSC, New Delhi.
The Principal Secretary, Agriculture confirmed the facts and stated
(November 2007) that amount of utilisation certificate (Rs 26.57 crore) was
misleading. He also agreed to verify correctness of figures reported by MSSC
and NSC.
4.5.2 Short supply of seeds due to incorrect estimation
Deputy Director, Seed, Pune estimated the district-wise requirement of seeds
for four9 crops as 1.37 lakh quintals (for total 64 talukas), which was much
less compared to the demand of 18 talukas (0.84 lakh quintals) indicating
incorrect estimation. Supply orders were given directly by field officers to
MSSC.
Test check of 18 talukas showed that as against demand for 0.84 lakh quintals,
MSSC, Akola supplied 0.31 lakh quintals (37 per cent) of seeds resulting in
short supply of 0.53 lakh quintals (63 per cent) of seeds to the farmers during
2006-07.
As per the estimates, seed requirement for 2007-08 and 2008-09 were less
than the requirement estimated for 2006-07. For major crops like wheat,
sunflower, maize etc. no requirement was projected for 2008-09. The
estimates were not realistic as these were made based on the amount allocated
to this component and not based on actual requirement.
The Principal Secretary, Agriculture stated (November 2007) that efforts
would be made to assess the requirement of seeds realistically.
4.6 Agriculture Insurance Scheme
To protect the farmers from the loss of crops due to Natural Calamity or any
other reasons, Government as a special case decided (February 2006) to pay
subsidy of 50 to 75 per cent of the premium payable on Crop Insurance. This
component was allotted Rs 30 crore and Rs 19 crore were released upto
March 2007. However, Rs 9.13 crore was lying unspent as of March 2007
with Commissioner of Agriculture, Pune.
9 Gram, Kardi Safflower, Sunflower, Wheat
No
requirement
of seed for
wheat, maize,
sunflower, etc.
was projected
for 2008-09
Audit Report (Farmers’ packages) for the year ended 31 March 2007
28
Against 4.48 lakh farmers in 15 test checked talukas, only 0.50 lakh farmers
(11 per cent) participated in the crop insurance. The taluka-wise participation
ranged between one per cent (Seloo) to 33 per cent (Chikhaldara). Thus, there
was poor participation of cultivators in insurance scheme.
The Principal Secretary, Agriculture agreed (November 2007) to review the
continued allocation to this component, as the crop insurance was not
attracting the farmers.
ERA survey showed that only three per cent respondents were covered under
crop insurance scheme.
4.7 Vidarbha Panlot Mission
To create availability of water for irrigation to achieve water conservation and
to generate agro based self employment through development of watersheds in
the six suicide prone districts, Vidarbha Panlot Mission was included in the
GOM package. Government allocated Rs 100 crore for this component and the
guidelines were issued in February and September 2006. However, out of
Rs 97 crore released by the Government between March 2006 and
February 2007, Rs 17.04 crore was spent as of March 2007.
The Principal Secretary, Water Conservation stated (November 2007) that
delay was due to change in the implementing agency from District Rural
Development Agency (DRDA) to Agriculture Department and delay in
approval to the relaxation to GOI guidelines, proposed (May-September 2006)
by GOM.
Failure to start the works even after two years of declaration the GOM
package (December 2005) would adversely impact the achievements
envisaged in the package.
4.7.1 Delayed issue of guidelines
In 18 test checked talukas, out of Rs 14.91 crore allocated, Rs 8.53 crore
(57 per cent) remained unutilised due to delay in release of funds and issue of
detailed guidelines (September 2006) of Panlot mission.
Principal Secretary, Water Conservation Department agreed (November 2007)
to speed up the completion of balance works.
Chapter IV – Long term measures
29
4.8 Other Components of the packages
Under the long term measures there were six other components. The
implementation was not satisfactory as detailed below:
(Rupees in crore)
Component
and
implementing
Departments
Brief description Amount
declared/
Amount
released
Amount
spent
(upto
March 200
7)
Audit findings/ Department’s reply
(i) Extension
Services (GOI)
(Agriculture
Department)
This was already
being implemented
through Agriculture
Technology
Management Agency
(ATMA) from 2005-
06 for empowering
the farmers.
3.00/
4.28
3.82 Test check showed that TAO, Karanja
Lad had received grant of
Rs 5.97 lakh during 2006-07.
However, no cash book was
maintained. Receipt of funds was also
not entered in the Bank Pass Book of
the bank account opened for the
purpose.
The Principal Secretary,
Agriculture stated that TAO
concerned has already been
suspended.
(ii)
Horticulture
Development
(GOI)
(Agriculture
Department)
The programme was
being implemented in
23 districts of
Maharashtra including
six suicide prone
districts of Vidarbha
with 100 per cent
subsidy from GOI
(June 2005)
225.00 (for
three
years)/
40.98
11.72 Out of Rs 40.98 crore released,
Rs 11.72 crore only was utilised in
2006-07. The amount was given
(June 2006) to Maharashtra State
Horticulture Medicinal Plantation
Board and kept out of Government
account without assessing the actual
requirement of funds.
The Principal Secretary (Agriculture)
stated that a consultant has been
appointed (June 2007) to suggest
forward linkage with market for
proper utilisation of balance amount.
(iii) Organic
Farming
Technology
(OFT) (GOM)
(Agriculture
Department)
Various items like
organic farming,
training, vermi
culture, etc. were
included under this
component
30.00/
10.30
9.89 Validation of the OFT was not got
done from the Agriculture University
in any of the test checked taluka.
Principal Secretary,
Agriculture stated (November 2007)
that validation requires three to four
years and the process has already been
started.
(iv) Joint
farming of
cotton (GOM)
(Agriculture
Department)
In order to encourage
the joint cotton
farming, this
component envisaged
execution of a
Memorandum of
Understanding
(MOU) by the
Farmers for the
purchase of cotton.
- - In three districts as against 9.37 lakh
farmers only 1477 (0.17 per cent)
farmers have participated through
seven MOUs executed during 2006-07
indicating poor coverage of the
farmers under this component.
Principal Secretary,
Agriculture stated that coverage and
impact of the component was
improving.
(v) Watershed
Development
(GOI)
Agriculture
Department)
This component
consists of watershed
development
programme and rain
water harvesting, to
be implemented by
240.00/
60.00
35.75 In 18 test checked talukas
Rs 10.49 crore was spent out of
Rs 13.64 crore allocated. Out of 801
works taken up for execution, 263
were completed and 538 works were
in progress.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
30
NABARD directly.
The third programme
check dam works was
to be implemented by
State Agriculture
Department with loan
from NABARD
(RIDF).
The Principal Secretary,
Water Conservation stated that out of
total 3000 check dams, 2497 were
completed as of June 2007 and
balance of 503 pertaining to 2006-07
and 3000 pertaining to 2007-08 would
be completed by June 2008.
(vi) Agro based
industries
(GOM) (Cooperation
Department)
To encourage the
establishment of agro
based processing
industries in six
districts, GOM
decided to provide
financial assistance to
the Agriculture
Processing Cooperative
Societies for
raising share capital.
No fund
allocation
under this
component
Not
available
DDRCS Amravati released
Rs 36.30 lakh to two Co-operative
Societies as 33 per cent share capital.
The societies have not started agroprocessing
units as of May 2007. In
other five districts, no proposals were
received as of May 2007. This
indicated the lack of response to the
component.
The Principal Secretary, Cooperation
stated (November 2007) that
work by two Co-operative societies
had already started and five out of 16
proposals received were approved by
the Department.
4.9 Conclusion
Funds for ‘Assistance for increase in production’ were released late; 12,623
farmers did not get the benefit despite availability of funds. No priority given
to the poorest farmers. A TAO issued cheques to 349 beneficiaries against the
targets of 110; nine cheques were dishonoured for want of cash in bank. Self
Helf Groups were paid subsidies in excess of the admissible norms. For
purchase of agricultural implements under ‘Micro irrigation’, a farmer’s share
was too large for a poor farmer. Though proposals for 185 minor irrigation
projects were rejected by NABARD on the ground of being technically
unfeasible and economically unviable those were taken up for execution.
Incorrect estimation of requirement led to short supply of 53,000 quintals of
seeds (63 per cent). Funds for Vidarbha Panlot Mission were underutilized.
4.10 Recommendations
• Higher rate of subsidy for small and marginal farmers could be
considered to extend envisaged benefits to larger number of farmers.
• Completion of projects under AIBP and from NABARD funds should
be monitored closely to avoid treatment of grant as loan by GOI.
• Crop insurance coverage could be extended to all crops including
horticulture.
Government accepted the above recommendations during exit conference
(November 2007).
========================================
==============================
==================
CHAPTER IV: LONG TERM MEASURES
The packages contained eight programmes which were long term measures for
alleviating farmers’ distress. The components and the implementing agencies
were as under:
Name of component Implementing Department
Assistance to farmers for increase in
agriculture production (GOM)
Agriculture Department
Agricultural allied activities for supplementary
income (GOM/GOI)
Animal Husbandry and Dairy
Development Department
Micro irrigation (GOI) Agriculture Department
Assured irrigation (GOI) Water Resources and Water
Conservation Department
Seed replacement and cropping intensity
(GOI)
Agriculture Department
Agriculture Insurance Scheme (GOM) Agriculture Department
Vidarbha Panlot Mission (GOM) Water Conservation Department
Other components (GOI/GOM) Agriculture, Co-operation and
Water Conservation Departments
4.1 Assistance to farmers for increase in production
GOM decided (February 2006) to provide agriculture inputs and implements
to 60,000 selected farmers from six districts of Vidarbha to assist the
economically weaker farmers. Under this component, assistance of Rs 25,000
each (with 50 to 100 per cent subsidy) was to be provided within a period of
three years in the form of seeds, fertilizers, insecticides, sprayers, land
development and water conservation. Conditions of eligibility for these
benefits included maximum land holding not exceeding six ha. and annual
income below Rs 20,000. District level Committee headed by District
Collector was to select the beneficiaries and the Taluka Agriculture Officer
was to implement the component.
Out of Rs 150 crore allocated for three years, Government released
Rs 85.40 crore during 2005-07 as reported by the Agriculture Department. Of
these, Rs 49.99 crore was spent as of March 2007. Under utilisation was
mainly due to release of funds at the fag end of the year (29 and
30 March 2007) by the Commissioner of Agriculture, Pune to the DSAOs.
Principal Secretary, Agriculture admitted (November 2007) that unspent
amount was transferred to Agriculture Technology Management Agency
(ATMA) of which Rs 7 crore was lying unspent with ATMA as of
September 2007.
Late release of
funds led to
grants
remaining
unspent
Audit Report (Farmers’ packages) for the year ended 31 March 2007
22
4.1.1 Selection of beneficiaries
The programme envisaged selection of 10,000 farmers from each of the six
districts. The beneficiaries were to be selected from the economically weaker
farmers giving priority to poorest and most backward class farmers.
In 18 talukas, out of 29,200 farmers who applied for supply of inputs and
implements, 16,577 farmers (57 per cent) were provided benefits as of
March 2007. As package components were for reducing the agrarian distress,
short coverage of 12,623 beneficiaries despite availability of funds needs
detail analysis.
Principal Secretary, Agriculture stated (November 2007) that the target of
60,000 farmers was set on ad-hoc basis. Hence, all farmers could not be
covered.
The reply indicated inadequate assessment of required inputs coupled with
ad-hocism in determining number of farmers targeted under this component.
Further, in Seloo taluka (District Wardha) 586 farmers applied for supply of
inputs/implements to Taluka Agriculture Officer against the target of 869.
District Level Committee headed by Collector, Wardha selected 129 farmers
from the most backward class farmers. Of these, 34 farmers had land holding
of two ha. and above, whereas 331 farmers (not from most backward class),
who had land holding below two ha., were not selected inspite of they being
poorer than those selected. Similarly, in seven other talukas of the District,
selection of the beneficiaries was made without giving priority to the poorest
farmers.
During exit conference (November 2007), the Chief Secretary directed the
Principal Secretary (R&R) to obtain a report from the present District
Collector and to take appropriate action.
4.1.2 Dishonoured cheques
Scrutiny disclosed that the TAO, Karanja, (Lad) (District Washim) had
issued (July 2007) cheques of Rs 15,000 each to 349 beneficiaries for
purchase of a pair of bullocks (total amount Rs 52.35 lakh) as against the
target of 110 beneficiaries fixed by the District Level Committee. Out of
349, nine cheques were dishonoured on 14 August 2007 as the TAO issued
cheques without confirming the balance in the bank account. The cheques
were subsequently encashed on 31 August and 01 September 2007. The
matter needs investigation.
Principal Secretary, Agriculture stated (November 2007) that the Taluka
Agriculture Officer had been suspended (November 2007).
4.1.3 Non-distribution of inputs/implements
Out of 18 test checked talukas, inputs and implements worth Rs 1.33 crore
were lying undistributed in eight talukas.
Forty three per
cent of the
needy farmers
were not
provided the
agricultural
inputs and
implements
Chapter IV – Long term measures
23
Principal Secretary, Agriculture agreed (November 2007) to distribute the
balance material in next three months and also agreed to issue instructions to
avoid purchase of inputs without assessing actual requirement.
4.2 Agricultural allied activities for supplementary income
Providing supplementary income avenues to the farmers through agricultural
allied activities was a component in the packages. For this component,
Rs 30 crore (GOM) and Rs 135 crore (GOI) spread over three years were
earmarked. Maharashtra Live Stock Development Board (MLDB), Akola was
the nodal agency for implementing this component.
As per Agriculture Department, out of total Rs 30.89 crore released for the
component, total expenditure incurred was Rs 14.17 crore as of March 2007.
Out of the unspent balance of Rs 16.72 crore, Deputy Commissioner, MLDB,
Akola deposited (October and December 2006) Rs 5 crore with two
nationalised banks as fixed deposit and earned interest of Rs 14.52 lakh. The
amount remained unaccounted for as of March 2007.
The Secretary, AHDD&F agreed (November 2007) to ensure the accountal of
the interest earned out of the funds parked in the banks.
4.2.1 Excess payment of subsidy
As per the norms prescribed by GOM (February 2006), the financial limit of
the project cost for the Self Help Groups (SHGs) of Above Poverty Line
(APL) beneficiaries was Rs 2 lakh and amount of subsidy payable to each
APL group was to be restricted to Rs 1.50 lakh.
In 13 test checked talukas, subsidy of Rs 2.64 crore was paid to 105 SHGs
instead of Rs 1.57 crore admissible as per the norms, resulting in excess
payment of Rs 1.07 crore during 2005-2007 (Appendix IX – Page 43).
Secretary, AHDD&F agreed (November 2007) to investigate the matter.
4.2.2 Deviation from norms
In Yavatmal District, subsidy of Rs 1.86 crore was paid on purchase of 1470
animals to 735 beneficiaries at a time between December 2006 and
March 2007. Similarly, in Buldana and Wardha Districts, subsidy of
Rs 2.66 crore was paid on purchase of 2138 animals between a gap of one to
four months for supply to 1069 beneficiaries. This was contrary to the
guidelines issued by GOI for providing a gap of six to seven months before the
second purchase.
The Secretary, AHDD&F stated (November 2007) that revised norms with
reasonable relaxation to GOI guidelines would be framed in view of local
conditions and strictly observed in future.
Excess subsidy
was paid to
Above Poverty
Line SHGs
Audit Report (Farmers’ packages) for the year ended 31 March 2007
24
4.3 Micro irrigation
For micro irrigation, Rs 26 crore per year for three years was declared
(August 2006) in the package (GOI). The component was applicable to all
districts in the State for horticulture crops upto 2005-06. Out of Rs 20.67 crore
released during 2006-07 the total expenditure incurred was Rs 20.62 crore as
of March 2007. A few interesting points noticed were as under:
(i) Under the component, drip and sprinkler sets were provided at 50 per
cent subsidised cost. The subsidy was to be shared between Central and State
Governments in a ratio of 80:20. The scheme was meant for the farmers
having electric connection and source of water for irrigation and to be
implemented through Sub-Divisional Agriculture Officer (SDAO).
In 18 test checked talukas, drip irrigation sets costing Rs 10.86 crore were
provided to 1878 farmers at an average cost of Rs 57,847 per set. Each farmer
was to bear 50 per cent average cost being Rs 28,924, which was a large
amount for a poor farmer.
The Principal Secretary, Agriculture stated (November 2007) that the matter
was reported to GOI in September 2006 for increasing the subsidy.
ERA survey showed that about two per cent respondents had applied for
sprinklers/drip irrigation facilities.
(ii) As per the norms prescribed by Commissioner of Agriculture, Pune,
the average distance for sowing of cotton of various qualities works out to less
than 1 metre (m) X 1 m. In 53 cases involving expenditure of Rs 26.81 lakh in
Amravati Tahsil and Morshi Tahsil of Amravati District showed that in
19 cases the distance of sowing cotton was wrongly shown as 1.5 m X 1.5 m.
This resulted in excess payment of subsidy by Rs 1.55 lakh. The Principal
Secretary, Agriculture (November 2007) agreed to look into the
appropriateness of subsidy as prescribed in the guideline.
(iii) In Amravati (one case) and Murtizapur taluka (four cases) subsidy of
Rs 4.22 lakh was paid on the basis of unsigned form 7/12. In reply
(October 2007), the SDAO/Tahsildar provided wrong spot verification
report/incorrect 7/12 to Audit. Principal Secretary, Agriculture agreed
(November 2007) to investigate and take action in the matter.
4.3.1 Pending proposals
In four sub-divisions (Akola, Mehkar, Morshi and Yavatmal) out of 5571
proposals received for subsidy of Rs 6.91 crore, 2841 proposals for
Rs 4.33 crore were pending as of June 2007 for want of funds under the
component, despite availability of unspent amount in other components.
The Principal Secretary, Agriculture stated (November 2007) that all pending
proposals have now been cleared. The fact remains that there was delay in
clearing the proposals.
Changes in
guidelines not
considered for
payment of
subsidy
Proposals
remained
pending for
want of
funds
Chapter IV – Long term measures
25
4.4 Assured irrigation
Assured irrigation was announced as a component of the GOI package for
Rs 2177 crore to create irrigation potential for 1.60 lakh hectares in six suicide
prone districts. Under this component, assistance of Rs 2085.38 crore was to
be provided for eight major, nine medium and 65 minor irrigation projects of
the State, as grant by the GOI under Accelerated Irrigation Benefit Programme
(AIBP). The balance amount of Rs 91.88 crore for 492 minor irrigation
projects of local sector was to be provided as loan from NABARD.
4.4.1 Short release of funds
As per records of Water Resources Department and Vidarbha Irrigation
Development Corporation (VIDC), Nagpur no funds for the proposed projects
were received upto February 2007. Position of Central assistance released
thereafter under AIBP was as below:-
(Rupees in crore)
Type of project Number
of
projects
proposed
under
GOI
package
Grant
required for
proposed
projects
under GOI
Package
during
2006-07
Number
of projects
considered
for
assistance
during
2006-07
Proportionate
grant
required
during
2006-07
Grant
actually
received
Short
receipt of
Central
grant
Major projects 8 489.62 5 273.28 67.48 205.8
Medium projects 77 151.84 5 85.51 48.11 37.4
Minor irrigation
projects to be
funded under
AIBP
228 85.96 22 85.96 55.89 30.07
Total 37 727.42 32 444.75 171.48 273.27
Short receipt of Central assistance of Rs 273.27 crore (61 per cent of GOI
grants required) hampered the envisaged projects in the first year of the
package. It was noticed that the land required for two major projects (Lower
Wardha and Khadakpurna) in the priority list, was not in possession of the
Department.
The Executive Director, VIDC, Nagpur stated (July 2007) that due to time
required for obtaining various clearances, the funds of Rs 273.27 crore were
not released by GOI.
Thus, creating irrigation potential within three years of declaration of package
appears to be difficult.
7 Two medium projects deleted (one due to non-clearance of forest land and other nearing
completion).
8 Forty three Minor irrigation projects were decided to be funded through NABARD.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
26
Delay in execution of project
Government of India revised (December 2006) the eligibility criteria for
funding. According to the revised criteria if the State Government fails to
comply with the agreed date of completion, the amount released is treated as
loan and recovered as per usual terms of recovery of the Central loan. Due to
short release / delayed release possibility of completion of the projects within
the agreed dates is remote. This presents the risk of Rs 2085.38 crore (56 per
cent) of total package amount becoming loan instead of grant.
Government stated (October 2007) that proposals to get the date of completion
of project extended was being submitted to GOI to avoid the possibility of
conversion of grant into loan.
4.4.2 Project estimates for NABARD loan
In the package it was proposed that 492 Minor Irrigation projects (Local
Sector) estimated (July 2006) to cost Rs 91.88 crore would be executed with
the help of loan from NABARD. Proposals in respect of only 319 Minor
Irrigation (MI) projects costing Rs 210 crore (as against Rs 91.88 crore to
cover 492 projects) were submitted to NABARD by Rural Development and
Water Conservation Department. Of these, 134 MI project proposals costing
Rs 74.70 crore were sanctioned (July 2007) by NABARD. Remaining
185 projects were not sanctioned, as they were not technically feasible and
economically viable (July 2007).
The Principal Secretary, Water Conservation stated (November 2007) that out
of 492 schemes, 233 schemes were completed upto March 2007 through State
funds. Out of remaining 259 schemes 195 would be taken up through
NABARD assistance and balance 64 schemes would be completed through
State fund.
The reply was not tenable as NABARD had already rejected (July 2007),
Governments proposals for 185 projects on the ground of being technically
unfeasible and economically unviable. Taking up these projects with State
funds would amount to risking investment with potential failures.
4.5 Seed replacement and cropping intensity
One of the components in GOI package included distribution of seeds to
farmers at a subsidy of 50 per cent subject to a limit of one ha. (of land
holding). Instructions for implementation of seed distribution component were
issued by the Commissioner of Agriculture, Pune on 21 August 2006.
An amount of Rs 180 crore was allotted for this component for a period of
three years. National Seeds Corporation Limited (NSC), New Delhi was the
nodal agency. However, the seed supply was to be done by Maharashtra State
Seeds Corporation (MSSC) as per demand of Agriculture Development
Officer (ADO), Zilla Parishad. Each farmer was to be issued a permit by TAO
One hundred
eighty five minor
irrigation
projects were not
sanctioned by
NABARD on the
ground of
technical
feasibility
Chapter IV – Long term measures
27
for each season, which could be produced at Taluka Kharedi Vikri Sangh
alongwith his share of 50 per cent for purchasing seeds.
4.5.1 Funds lying unutilised
As against Rs 60 crore declared for 2006-07, GOI released Rs 25.46 crore.
The VNSSM showed (April 2007) GOI release as Rs 17.50 crore. The
utilisation certificate of MSSC, Akola, however, indicated (July 2007) that
total value of seed distributed to farmers was Rs 26.57 crore. Excluding
farmers’ share of Rs 13.29 crore in the cost of these seeds, Rs 12.17 crore was
lying unutilised with NSC, New Delhi.
The Principal Secretary, Agriculture confirmed the facts and stated
(November 2007) that amount of utilisation certificate (Rs 26.57 crore) was
misleading. He also agreed to verify correctness of figures reported by MSSC
and NSC.
4.5.2 Short supply of seeds due to incorrect estimation
Deputy Director, Seed, Pune estimated the district-wise requirement of seeds
for four9 crops as 1.37 lakh quintals (for total 64 talukas), which was much
less compared to the demand of 18 talukas (0.84 lakh quintals) indicating
incorrect estimation. Supply orders were given directly by field officers to
MSSC.
Test check of 18 talukas showed that as against demand for 0.84 lakh quintals,
MSSC, Akola supplied 0.31 lakh quintals (37 per cent) of seeds resulting in
short supply of 0.53 lakh quintals (63 per cent) of seeds to the farmers during
2006-07.
As per the estimates, seed requirement for 2007-08 and 2008-09 were less
than the requirement estimated for 2006-07. For major crops like wheat,
sunflower, maize etc. no requirement was projected for 2008-09. The
estimates were not realistic as these were made based on the amount allocated
to this component and not based on actual requirement.
The Principal Secretary, Agriculture stated (November 2007) that efforts
would be made to assess the requirement of seeds realistically.
4.6 Agriculture Insurance Scheme
To protect the farmers from the loss of crops due to Natural Calamity or any
other reasons, Government as a special case decided (February 2006) to pay
subsidy of 50 to 75 per cent of the premium payable on Crop Insurance. This
component was allotted Rs 30 crore and Rs 19 crore were released upto
March 2007. However, Rs 9.13 crore was lying unspent as of March 2007
with Commissioner of Agriculture, Pune.
9 Gram, Kardi Safflower, Sunflower, Wheat
No
requirement
of seed for
wheat, maize,
sunflower, etc.
was projected
for 2008-09
Audit Report (Farmers’ packages) for the year ended 31 March 2007
28
Against 4.48 lakh farmers in 15 test checked talukas, only 0.50 lakh farmers
(11 per cent) participated in the crop insurance. The taluka-wise participation
ranged between one per cent (Seloo) to 33 per cent (Chikhaldara). Thus, there
was poor participation of cultivators in insurance scheme.
The Principal Secretary, Agriculture agreed (November 2007) to review the
continued allocation to this component, as the crop insurance was not
attracting the farmers.
ERA survey showed that only three per cent respondents were covered under
crop insurance scheme.
4.7 Vidarbha Panlot Mission
To create availability of water for irrigation to achieve water conservation and
to generate agro based self employment through development of watersheds in
the six suicide prone districts, Vidarbha Panlot Mission was included in the
GOM package. Government allocated Rs 100 crore for this component and the
guidelines were issued in February and September 2006. However, out of
Rs 97 crore released by the Government between March 2006 and
February 2007, Rs 17.04 crore was spent as of March 2007.
The Principal Secretary, Water Conservation stated (November 2007) that
delay was due to change in the implementing agency from District Rural
Development Agency (DRDA) to Agriculture Department and delay in
approval to the relaxation to GOI guidelines, proposed (May-September 2006)
by GOM.
Failure to start the works even after two years of declaration the GOM
package (December 2005) would adversely impact the achievements
envisaged in the package.
4.7.1 Delayed issue of guidelines
In 18 test checked talukas, out of Rs 14.91 crore allocated, Rs 8.53 crore
(57 per cent) remained unutilised due to delay in release of funds and issue of
detailed guidelines (September 2006) of Panlot mission.
Principal Secretary, Water Conservation Department agreed (November 2007)
to speed up the completion of balance works.
Chapter IV – Long term measures
29
4.8 Other Components of the packages
Under the long term measures there were six other components. The
implementation was not satisfactory as detailed below:
(Rupees in crore)
Component
and
implementing
Departments
Brief description Amount
declared/
Amount
released
Amount
spent
(upto
March 200
7)
Audit findings/ Department’s reply
(i) Extension
Services (GOI)
(Agriculture
Department)
This was already
being implemented
through Agriculture
Technology
Management Agency
(ATMA) from 2005-
06 for empowering
the farmers.
3.00/
4.28
3.82 Test check showed that TAO, Karanja
Lad had received grant of
Rs 5.97 lakh during 2006-07.
However, no cash book was
maintained. Receipt of funds was also
not entered in the Bank Pass Book of
the bank account opened for the
purpose.
The Principal Secretary,
Agriculture stated that TAO
concerned has already been
suspended.
(ii)
Horticulture
Development
(GOI)
(Agriculture
Department)
The programme was
being implemented in
23 districts of
Maharashtra including
six suicide prone
districts of Vidarbha
with 100 per cent
subsidy from GOI
(June 2005)
225.00 (for
three
years)/
40.98
11.72 Out of Rs 40.98 crore released,
Rs 11.72 crore only was utilised in
2006-07. The amount was given
(June 2006) to Maharashtra State
Horticulture Medicinal Plantation
Board and kept out of Government
account without assessing the actual
requirement of funds.
The Principal Secretary (Agriculture)
stated that a consultant has been
appointed (June 2007) to suggest
forward linkage with market for
proper utilisation of balance amount.
(iii) Organic
Farming
Technology
(OFT) (GOM)
(Agriculture
Department)
Various items like
organic farming,
training, vermi
culture, etc. were
included under this
component
30.00/
10.30
9.89 Validation of the OFT was not got
done from the Agriculture University
in any of the test checked taluka.
Principal Secretary,
Agriculture stated (November 2007)
that validation requires three to four
years and the process has already been
started.
(iv) Joint
farming of
cotton (GOM)
(Agriculture
Department)
In order to encourage
the joint cotton
farming, this
component envisaged
execution of a
Memorandum of
Understanding
(MOU) by the
Farmers for the
purchase of cotton.
- - In three districts as against 9.37 lakh
farmers only 1477 (0.17 per cent)
farmers have participated through
seven MOUs executed during 2006-07
indicating poor coverage of the
farmers under this component.
Principal Secretary,
Agriculture stated that coverage and
impact of the component was
improving.
(v) Watershed
Development
(GOI)
Agriculture
Department)
This component
consists of watershed
development
programme and rain
water harvesting, to
be implemented by
240.00/
60.00
35.75 In 18 test checked talukas
Rs 10.49 crore was spent out of
Rs 13.64 crore allocated. Out of 801
works taken up for execution, 263
were completed and 538 works were
in progress.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
30
NABARD directly.
The third programme
check dam works was
to be implemented by
State Agriculture
Department with loan
from NABARD
(RIDF).
The Principal Secretary,
Water Conservation stated that out of
total 3000 check dams, 2497 were
completed as of June 2007 and
balance of 503 pertaining to 2006-07
and 3000 pertaining to 2007-08 would
be completed by June 2008.
(vi) Agro based
industries
(GOM) (Cooperation
Department)
To encourage the
establishment of agro
based processing
industries in six
districts, GOM
decided to provide
financial assistance to
the Agriculture
Processing Cooperative
Societies for
raising share capital.
No fund
allocation
under this
component
Not
available
DDRCS Amravati released
Rs 36.30 lakh to two Co-operative
Societies as 33 per cent share capital.
The societies have not started agroprocessing
units as of May 2007. In
other five districts, no proposals were
received as of May 2007. This
indicated the lack of response to the
component.
The Principal Secretary, Cooperation
stated (November 2007) that
work by two Co-operative societies
had already started and five out of 16
proposals received were approved by
the Department.
4.9 Conclusion
Funds for ‘Assistance for increase in production’ were released late; 12,623
farmers did not get the benefit despite availability of funds. No priority given
to the poorest farmers. A TAO issued cheques to 349 beneficiaries against the
targets of 110; nine cheques were dishonoured for want of cash in bank. Self
Helf Groups were paid subsidies in excess of the admissible norms. For
purchase of agricultural implements under ‘Micro irrigation’, a farmer’s share
was too large for a poor farmer. Though proposals for 185 minor irrigation
projects were rejected by NABARD on the ground of being technically
unfeasible and economically unviable those were taken up for execution.
Incorrect estimation of requirement led to short supply of 53,000 quintals of
seeds (63 per cent). Funds for Vidarbha Panlot Mission were underutilized.
4.10 Recommendations
• Higher rate of subsidy for small and marginal farmers could be
considered to extend envisaged benefits to larger number of farmers.
• Completion of projects under AIBP and from NABARD funds should
be monitored closely to avoid treatment of grant as loan by GOI.
• Crop insurance coverage could be extended to all crops including
horticulture.
Government accepted the above recommendations during exit conference
(November 2007).
================
=====================
Appendices
33
APPENDIX I
(Reference: Paragraph 1.1 and 2.2)
Components under package declared by GOM and GOI
(Rupees in crore)
Sr. No. Components under package declared by GOM Amount
1. Immediate relief -
2. Rescheduling of loan
Interest more than principle should not be charged for Co
operative loan
Loan disbursement to Self Help Groups of farmers
Restructuring of credit disbursement procedure
225.00
3. Regulation of loan disbursed by money lenders Nil
4. Agriculture Insurance scheme 30.00
5. Financial assistance to farmers for increase in production 150.00
6. Agriculture Allied Activities 30.00
7. Agro Based Industries Nil
8. Joint Farming of Cotton Nil
9. Community Marriages 6.00
10. Refund of Capital Formation Fund 370.00
11. Compensation to Cotton Growing Farmers 134.00
12. Organic Farming Technology 30.00
13. Vidarbha Panlot Mission 100.00
14. Help Line for Farmers Nil
TOTAL 1075.00
Components under package declared by GOI Amount
1. Ex-gratia assistance from PMNRF -
2. Debt Relief to Farmers and Credit Flow -
3. Interest Waiver 712.00
4. Assured irrigation facilities 2177.00
5. Seed Replacement and Cropping Intensity 180.00
6. Watershed Development 240.00
7. Horticulture Development 225.00
8. Micro Irrigation 78.00
9. Extension Services 3.00
10. Subsidiary income 135.00
TOTAL 3750.00
Note:- Sr.No. 4, 10, 11 & 12 of GOM package (total: Rs 564 crore) and no. 8, 9 and
10 of GOI package (total: Rs 306 crore) were for entire State.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
34
APPENDIX II
(Reference: Paragraph 1.2)
Implementing departments
Sr.
No.
Implementing
Departments
Implementing
District/Taluka level
offices
Components
1. Revenue and Forests
Department (Relief &
Rehabilitation Wing)
District Collectors &
Tahsildars
(i) Immediate relief
(ii) Help Line
(iii)Ex-gratia assistance from PMNRF
2. Co-operation &
Textile Department
(i) RBI/NABARD/
(ii) DDRCS/
Nationalised and Cooperative
Banks
(iii) Cotton Federation
(i) Rescheduling of loan, (ii)
Regulation of loan disbursed by
money lenders,
(iii) Interest more than principle
should not be charged for Cooperative
loan,
(iv) Loan disbursement to Self Help
Groups of farmers
(v) Restructuring of credit
disbursement procedure
3. Agriculture
department
Agriculture Insurance
Company, Taluka
Agriculture Officer,
District Superintending.
Agriculture Officer-
(i) Agriculture Insurance scheme, (ii)
Financial assistance to farmers for
increase in production,
(iii) Agro Based Industries,
(iv) Joint/Contract Farming of Cotton,
(v) Compensation to Cotton Growing
Farmers,
(vi) Organic Farming Technology,
(vii) Vidarbha Panlot Mission,
(viii) Seed Replacement and
Cropping Intensity,
(ix) Watershed Development,
(x) Horticulture Development,
(xi) Micro Irrigation,
(xii) Extension Services
4. Animal Husbandry
Department
Maharashtra Live Stock
Development Board
(MLDB), Akola,
District & Taluka level
Offices of Animal
Husbandry Deptt.
Agriculture Allied Activities
5. Women & Child
Welfare Deptt.
District Women &
Child Welfare Officer
Community Marriages
6. Water Resources
Department
Vidarbha Irrigation
Development
Corporation (VIDC)
Assured irrigation facilities
7. Water Conservation
Department
Taluka Agriculture
Officer, Chief Engineer
(Local Sector)
Construction of check dams, Minor
Irrigation (Local Sector)
Appendices
35
APPENDIX III
(Reference: Paragraph 1.5 & 2.1)
Special Package (GOM)
(Rupees in crore)
Sr.
No.
Name of Component Grant
released
(six
districts)
as per
VNSSM
Expenditure
as of
31/03/2007
(six
districts) as
per VNSSM
Whether
component
was for
entire
State
Grant
entire
State as
per
VNSSM
Expenditure
entire State
as per
VNSSM
1. Immediate relief 11.32 11.32 No - -
2 Rescheduling of loan;
Interest more than
principle should not be
charged for Cooperative
loan; Loan
disbursement to Self
Help Groups of
farmers; Restructuring
of credit disbursement
procedure.
240.98 239.12 No - -
3 Agriculture Insurance
scheme
19.00* 9.87 Yes NA NA
4 Financial assistance to
farmers for increase in
production
50.20 49.99 No - -
5 Agricultural allied
activities
31.00 23.22 No - -
6 Community Marriage 14.23 9.22 No - -
7 Refund of Capital
Formation Fund
405.15* 396.59 Yes 875.53 704.48
8 Compensation to cotton
growing farmers
131.72* 130.12 Yes 299.49 265.09
9 Organic Farming
Technology
10.30* 9.15 Yes 26.44 25.39
10 Vidarbha Panlot
Mission
97.00 17.04 No - -
TOTAL 1010.90 895.64 1201.46 994.96
* Component implemented in entire State
Note:- Expenditure in six districts : GOM package Rs 895.64 crore
GOI package Rs 1532.78 crore
Rs 2428.42 crore
Less amount repeated in GOM package Rs 239.12 crore
Net Rs 2189.30 crore
Audit Report (Farmers’ packages) for the year ended 31 March 2007
36
APPENDIX IV
(Reference paragraph 1.5)
Details of expenditure covered under audit
Government of Maharashtra
(I) District Level Component (Rupees in crore)
1. Capital Formation Fund 396.59
2. Community Marriages 4.43
3. Crop Insurance 9.87
4. Allied Activities 9.73
(II) Taluka Level Component
1. Cotton Compensation 36.87
2. Organic Farming 1.94
3. Immediate Relief 3.10
4. Agriculture Inputs (60,000 farmers) 13.75
5. Vidarbha Panlot Mission 17.04
Government of India
(I) District Level Component
1. Interest Waiver 824.99
2. Assured Irrigation -
3. Seed supply 13.20
4. National Horticulture Mission 11.71
5. Micro Irrigation 20.62
6. Allied Activities 4.44
(II) Taluka Level Component
1. Watershed Development Programme 13.64
2. PMNRF 0.88
3. ATMA 0.66
GRAND TOTAL 1383.46
Appendices
37
APPENDIX V
(Paragraph 1.5)
Sampling Plan for survey of the land holders conducted by ERA
Methodology
Data pertaining to 7/12 of the farmers for all suicide prone districts of
Vidarbha region was obtained from the Settlement Commissioner and
Superintendent of Land Records, Maharashtra State, Pune and then 12 Talukas
namely Amravati, Anjangaon, Chandur Bazar, Morshi, Deulgaonraja, Jalgaon
Jamod, Malkapur, Mehkar, Motala, Karanja, Ghatanji, Pusad were selected
randomly out of 64 Talukas in these six districts. For the process of sampling,
village was considered as one unit. Villages were selected by stratifying them
into two categories.
Category-1: Twenty villages were selected for Census on the basis of
benefits given to the farmers under the 3 package components namely
Immediate Relief, Prime Minister’s National Relief Fund and Community
Marriages.
Category-2: For survey, twenty-five percent villages from the 12 Taluka
were extracted as sample by Probability Proportionate to Size (PPS) Method.
The sample interval for each was derived from the control total of the
remaining villages (i.e. villages which remained after deleting the names of
Census villages selected in Category-1).
In this category, for survey of villages, twenty percent land holders were
selected from each strata after stratifying the land holders into following 3
stratas. (Sampling done by the survey firm.)
Stratum 1 – Land holders with less than 2 hectares of land.
Stratum 2 – Land holders with 2 to 6 hectares of land.
Stratum 3 – Land holders with more than 6 hectares of land.
On the basis of issues identified, questionnaires in Marathi were designed and
canvassed. 41663 land holders were surveyed by the firm M/s Empirical
Research Agency Private Limited and Gomukh Environmental Trust for
Sustainable Development, Pune.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
38
APPENDIX VI
(Paragraph 1.5)
Executive Summary of Survey Results of Farmers’ Package
In all 383 villages were covered in the survey. Twenty villages were covered on
Census basis and 363 villages were covered on sample basis. Total farmers covered in
the survey were 41,663. Out of them 8697 farmers were selected in the sample but
were not residents of that village. Hence, the number of resident farmers contacted
was 32,966. The responses of these farmers were further analyzed to get output
formats, non-resident farmers were not considered while analyzing the data. Districtwise
coverage of villages and farmers/khatedars is presented in the following table:
District No. of villages No. of nonresident
farmers
No. of farmers
Washim 39 1016 3051
Yavatmal 77 1476 4500
Amravati 136 4104 13753
Buldhana 131 2101 11662
Total 383 8697 32966
Land holding pattern
Majority of farmers (71 per cent) owned land up to 2 ha. The second largest group
was of those farmers who held land in range of 2 to 6 ha. Whereas, those reporting,
ownership of land more than 6 ha. were approximately 4 per cent in the total sample.
Except Yavatmal District a similar trend is evident in all other districts. In Yavatmal
however, those owning land up to 2 ha. were 54 per cent. Those reporting land
holding in range of 2 to 6 ha. were 40 per cent and approximately six per cent
reported land holding more than 6 ha.
Source of irrigation
Wells are reported as major source of irrigation. In overall sample 77 per cent of
farmers reporting irrigation depend on well water as a source of irrigation. However,
in Washim and Yavatmal district around 56- to 58 per cent reported well as source of
irrigation. In Amravati and Buldhana 84 and 80 per cent farmers respectively,
reported well as source of irrigation. A considerable percentage of farmers reporting
irrigation, depended on river as source of irrigation in Washim and Yavatmal
district.(around 20 per cent) , and 16 per cent farmers from Washim district reported
bore wells as source of irrigation. Average irrigated land is reported at 1.50 ha. in
overall sample. It is maximum in Washim at 2.17 ha. and is minimum in Buldhana at
1.00 ha.
Survey in 2006
Only 8 per cent farmers confirmed the visit of any government official in the year
2006. This percentage was minimum in Washim at just 3 per cent. Some six per cent
in total sample did not remember about such visit. Whereas, 85 per cent in total
sample stated that they were not visited by any government official. This percentage
is highest in Washim at 95 per cent.
About GOI / GOM Package
In the total sample 40 per cent farmers were aware about the GOI / GOM Package.
This awareness was found maximum in Washim district at 54 per cent and it was
minimum in Amravati district at 32 per cent. Some 22 per cent farmers had heard
about the package. Those who had heard about the package were maximum at 33 per
cent in Washim and Buldhana districts and minimum at 8 per cent in Amravati
Appendices
39
district. Those who did not know about the package were 36 per cent in overall
sample. This group was maximum in Amravati at 57 per cent.
Forty-nine per cent farmers were aware about the advantages of the packages. This
percentage was highest in Yavatmal at 74 per cent and minimum in Washim and
Buldhana at 31 per cent. Village meetings was the source of information in case of
maximum farmers (40 per cent), whereas, other sources were reported by 34 per cent
farmers. This included discussions with fellow farmers etc.
Albeit availing the information about the packages declared by the government
almost half of the farmers did not approach any body to understand as to how they
could be benefited by these packages. Only 5 per cent of those who were aware about
the package could avail the desired benefits from these packages.
About loans from money lenders
In the overall sample 75 per cent farmers were not aware about the relief from the
unregistered money lenders. Only 1.30 per cent farmers reported taking loans from
unregistered money lenders.
Bank Loans
Fifty five per cent farmers took loans from banks in overall sample. This percentage
is reported highest in Washim and Yavatmal districts at around 70 per cent. Almost
70 per cent loans were taken in the period of three years i.e. 2004-06. Only 25 per
cent farmers were aware that the interest upto 30-06-06 on their loans was waived.
Farmers applying for new loans were 25 per cent. In 72 per cent cases the loan was
sanction within 1 to 3 months. 67 per cent farmers stated that mortgage was necessary
to take new loan. Moreover, those who were asked to repay the old dues while
sanctioning new loans were 44 per cent. Some 8 per cent farmers reported that the
fees were charged while processing the new loans.
Most of the farmers among those taking loans, had taken only one loan during the
period 2000 to 2005. (83 per cent). Another 11 per cent had taken loan two times
during this period. Those taking loan for three times during this period were 5 per
cent and only one per cent had taken loan for 4 times during this period.
Refund of Capital Formation Fund
In the total sample 80 per cent farmers reported growing cotton during the period of
1974 to 1993. About 65 per cent of the cotton growers received the dues on account
of Capital Formation Fund. More or less the percentage of these farmers is the same
in all the districts.
In the year 2005, 63 per cent farmers reported cultivating cotton. Average yield per
acre was reported at less than half quintal per acre. The expected yield per acre was
reported at about 2 quintal per acre. In the year 2006, same percentage of farmers
cultivated cotton. The average yield they could get was about 2 and half quintal per
acre and the yield they expected this year was more than 4 and half quintal per acre.
Crop insurance was reported by just 3 per cent farmers in the total sample. As
compared to other districts in Yavatmal the figure of those going for crop insurance is
higher at 14 per cent.
Forty six per cent farmers reported the receipt of ‘lalya’ (a disease resulting in
reddening of cotton) compensation. It is reported maximum in Yavatmal at 70 per
cent and minimum in Amravati at 34 per cent.
Audit Report (Farmers’ packages) for the year ended 31 March 2007
40
Supply of Agricultural inputs
Sixty three per cent farmers were aware about the supply of inputs at subsidized rates.
Major source of information was the village level officers like Gram sevaks and
Talathis in case of about 44 per cent farmers. Delay in the supply of inputs was
reported by 28 per cent farmers. Out of them almost 94 per cent were of the opinion
that the delay was not due to late payment of contribution amount by the farmers. 60
per cent of those who received inputs felt that these inputs were profitable whereas,
only in case of 2 per cent they felt that they have incurred losses due to the supply of
these inputs. Those who thought that neither they got profit nor they incurred losses
were 38 per cent.
Sprinkler and Drip irrigation facilities
Hardly 2 per cent farmers reported applying for the above mentioned irrigation
facilities. The percentage is more or less the same in all the 4 districts.
Community marriage scheme
This is also a component which has not succeeded in drawing attention of the
farmers. It is reported that less than one per cent of the farmers applied for
participation under this scheme. The percentage is slightly higher at 2 per cent in
Yavatmal district. However, in case of almost 38 per cent farmers they did not think
of this scheme because they did not have marriageable daughter. Out of those who
applied, 30 per cent farmers reported having married their daughters in community
marriage events.
Suicide cases
In the overall sample only 0.65 per cent farmers reported suicide cases in the family.
It was maximum at 0.9 per cent in Yavatmal and minimum at 0.5 per cent in
Buldhana. 60 per cent of those reporting suicide felt that no proper action was taken
by concerned authorities after the incident of suicide. 46 per cent claimed that they
did not get any assistance. 23 per cent got the assistance during the time span of 1 to
3 months. Only 4 per cent claimed that they got assistance within a month.
Health and Education
Overall 18 per cent farmers were aware about the free telephone service (helpline)
started by the government. This awareness was maximum in Yavatmal at 25 per cent
and minimum in Washim at 9 per cent.
Assistance required
Forty four per cent farmers demanded assistance for children’s education, 35 per cent
needed assistance to practice organic farming, another 34 per cent asked for
assistance for the treatment of sickness in family. Assistance for sprinkler and
electricity for pumps was the demand of 32 and 33 per cent respectively.
Comparatively, negligible percentage of farmers has asked for assistance to start
horticulture crops (1 per cent). Although, these demands were put forth by the
farmers, most of theme. 87 per cent had not taken any action in order to get the
desired assistance. Training was attended by only 1 per cent farmers.
Livestock
The survey indicated that less than 1 per cent farmers, received assistance in the form
of livestock. 95 per cent farmers could not get benefit form vaccination service
provided by government. Moreover, 99 per cent farmers did not get the milk cans
provided by the government.
Appendices
41
APPENDIX VII
(Reference: Paragraph 2.1)
Special Rehabilitation Package (GOI)
(Rupees in crore)
Grant released (six
districts) as per
VNSSM
Sr.
No
Name of
Component
Central State
Expenditure
as of
31/03/2007
(six districts)
As per
VNSSM
Whether
component
was for
entire
State
Grant
entire
State
Expenditure
entire State
1. 2. 3. 4. 5. 6. 7. 8.
1 Ex-gratia
assistance
from PMNRF
3.00 1.80 4.26 No - -
2 Debt Relief
to Farmers,
Credit Flow,
Interest
Waiver
125.00 356.00 824.99 No - -
3 Assured
irrigation
facilities
122.50 882.00 613.70 No - -
4 Seed
Replacement
and Cropping
Intensity
17.50 - 13.20 No - -
5 Watershed
Development
- 60.00 33.35 No - -
6 Horticulture
Development
*
14.48 - 11.71 Yes 82.60 76.56
7 Micro
Irrigation *
16.54 4.13 20.62 Yes 109.93 98.82
8 Extension
Services *
3.83 0.44 3.81 Yes 6.84 5.90
9 Subsidiary
income
23.11 2.25 7.14 No - -
325.96 1306.62 1532.78 199.37 181.28
* Component implemented in entire State
Audit Report (Farmers’ packages) for the year ended 31 March 2007
42
APPENDIX VIII
(Paragraph 3.4)
Excess area under cotton cultivation
(Rupees in lakh)
Area of cotton cultivation (in ha)
as reported by
Excess of area
assessed for
payment of
compensation over
the area shown in
CCR in the Taluka
District
MRSAC DSAO &
ADO(ZP)
(%
increase)
as
reported
through
CCR
Collector
(through
Talathi)
(%
increase)
Amount
paid for
area
assessed
in
excess
of the
area
shown
in the
CCR
Taluka
(in
hectares)
Amount
Akola 170120 197501
(16%)
213098
(25%)
156.02 Murtizapur* -- --
Nandgaon
Khandeshwar
9861.00 98.93
Chandur
Bazar
4498.00 44.98
Morshi 2790.32 27.90
Chikhaldara 825.94 8.26
Anjangaon
Surji*
-- --
Amravati 212790 241051
(13%)
254400
(20%)
212.48
Amravati* -- --
Lonar 449.45 4.50
Motala 30488.00 304.88
Deulgaon
Raja
1961.00 23.13
Malkapur 3866.89 38.66
Jalgaon
Jamod
8129.77 81.30
Buldana 190770 209630
(10%)
278963
(46%)
693.33
Mehkar* -- --
Wardha 105460 96632 (-
8%)
137163.52
(30%) 405.31 Seloo 4571.63 45.72
Washim 457.96 4.57 Washim 56880 58591
(3%)
82400
(45%) 238.09 Karanja Lad 17030.76 170.31
Ghatanji 10259.00 102.59 Yeotmal 313200 320494
(2%)
349200
(11%) 285.06 Pusad* -- --
TOTAL 1049220 1123899 1315224.50 95189.72 955.73
* Area of cotton cultivation as per Crop Cultivation Report (CCR) was more than the
area for which compensation was paid.
Appendices
43
APPENDIX IX
(Reference Paragraph 4.2.1)
Excess payment of subsidy
(Rupees in lakh)
Sr.
No.
District TALUKA No. of
APL
groups
Project
ccst
Subsidy
actually
paid
Subsidy
payable
(Rs 1.50
lakh per
project)
Excess
subsidy
1. Akola Murtizapur 15 45.60 34.21 22.50 11.71
2. Amravati 10 38.15 28.61 15.00 13.61
3. Morshi 06 22.70 17.02 9.00 8.02
4. Chandur
Bazar
10 41.30 30.98 15.00 15.98
5. Chikhaldara 03 10.20 7.65 4.50 3.15
6.
Amravati
Nandgaon
Khandeshwar
06 23.10 17.32 9.00 8.32
7. Motala 07 22.50 16.88 10.50 6.38
8. Lonar 07 22.50 16.87 10.50 6.37
9. Malkapur 10 33.50 24.75 15.00 9.75
10. Mehkar 07 23.25 17.44 10.50 6.94
11.
Buldhana
Jalgaon
Jamod
06 16.25 12.19 9.00 3.19
12 Ghatanji 09 30.00 22.50 13.50 9.00
13.
Yavatmal
Pusad 09 23.61 17.70 13.50 4.20
105 352.66 264.12 157.50 106.62