Internal Controls and Risk evaluation PMAYG By Vijay
Internal Controls and Risk evaluation PMAY-G By Vijay Choudhary ICAS
Topics to be covered: � Brief overview of PMAY-G scheme
Background- Efforts made for Rural Housing � � In 1957, as a part of the Community Development Movement (CDM), a village Housing Programme (VHP) was introduced providing loans to individuals and cooperatives, of up to ₹ 5000/- per unit. Rural Housing Construction was allowed for SCs/STs and freed bonded labourers under National Rural Employment Programme (NREP-1980), and Rural Landless Employment Guarantee Programme (RLEGP-1983). A full-fledged rural housing programme Indira Awas Yojana (IAY) was later launched in June, 1985 as a sub-scheme of RLEGP IAY was made an independent programme w. e. f 1 January, 1996 aimed at addressing housing needs of the Below Poverty Line (BPL) households.
Background- Efforts made for Rural Housing � � After 30 years of implementation of IAY, in view of limited scope of coverage (BPL) under the programme there still are considerate gaps in rural housing. To provide “Housing for All” by 2022, PMAY has been reconstructed into Pradhan Mantri Awas Yojana - Gramin (PMAY-G) w. e. f. 1 April, 2016.
Brief overview of PMAY-G � � � PMAY-G aims to provide a pucca house with basic amenities to all houseless households and households living in kutcha and dilapidated houses in rural areas by 2022. the target number of houses to be constructed by the year 2021 -22, is ₹ 2. 95 crore. The minimum unit (house) size enhanced from 20 sq. m (under PMAY) to 25 sq. m including a dedicated area for hygienic cooking.
Brief overview of PMAY-G � � � Enhancement of unit assistance from ₹ 70, 000 to ₹ 1. 20 lakh in plains and from ₹ 75, 000 to ₹ 1. 30 lakh in hilly States, difficult areas and IAP districts. The cost of unit (house) assistance is to be shared between Central and State Governments in the ratio of 60: 40 in plain areas and 90: 10 for North- Eastern and three Himalayan States (Jammu & Kashmir, Himachal Pradesh and Uttarakhand). Provision of assistance (₹ 12, 000) for toilets through convergence with Swach Bharat Mission -Gramin (SBM-G), MGNREGS or any other dedicated source of funding.
Brief overview of PMAY-G � � Provision of 90/95 persondays of un-skilled labour wage under MGNREGA for construction of house, over and above the unit assistance Identification and selection of beneficiaries, based on the housing deficiency and other social deprivation parameters in SECC-2011 data, and verified by the Gram Sabhas All payments to the beneficiary to be made electronically to their Bank/Post office accounts that are linked to Adhaar with consent. 95 % of funds would be released to States /UTs for construction of new houses under PMAY-G. This will also include 4 % allocation towards administrative expenses.
Brief overview of PMAY-G � Social earmarking of targets ◦ At least 60% of the total PMAY-G funds and physical targets should be utilised for construction/ upgradation of dwelling units for SC/ST BPL households. ◦ A maximum 40% for non-SC/ST BPL rural households. ◦ PMAY-G funds and physical targets will be earmarked for BPL minorities in each State as indicated by the Ministry. ◦ Three per cent of the above categories are for physically and mentally challenged persons.
Fund flow
Fund Management � � � The States/UTs shall maintain single savings account in a scheduled commercial Bank at State level and referred as SNA (State Nodal Account) and the account details shall also be registered in Awaassoft and with PFMS The annual central allocation and matching State share shall be deposited in SNA shall operate bank account only electronically through a FTO The State/UT Government shall designate two signatory authorities (a creator/maker as first signatory and approver/checker as second signatory). The FTO will have to be digitally signed by these two authorities. The transfer of assistance to the beneficiaries shall be done to his/her registered bank/PO accounts through digitally signed FTO.
Release of funds � The annual allocation will be released in two instalments. ◦ First instalment shall be equal to 50% of Central share of annual allocation and will be released in the beginning of the financial year ◦ Second instalment shall be equal to the Central share annual allocation minus first instalment on condition of � Utilisation of 60% of total available funds on Awaassoft � Achievement of physical progress as per prescribed criteria and indicators � States/UTs have to submit proposal for second instalment along with required documents in prescribed Performa (for details refer Guidelines 10. 5. 3) before 31 December
Release of funds � � The State Government shall release full State share within a period of 15 days of the Central share The central allocation of funds including administrative funds which have been sent to State Consolidated Fund should be transferred to the State Nodal Account within 15 days from the date of receipt of Fund failing which a penal interest rate of 12%p. a would be applicable.
Identification and Selection of beneficiaries � � � The universe of eligible beneficiaries under PMAY-G will include all the houseless and households living in zero, one or two room houses with kutcha wall and kutcha roof as per SECC data Priority will be assigned on the basis of parameters reflecting housing deprivation in each category viz. , SC/ST/ Minorities and others. System generated category-wise ranked priority list could be downloaded from the programme MIS-Awaassoft.
Grievance Redressal in identification of beneficiary � � � Once the list have been made available by Gram Sabha, the lists should be widely publicised within the Gram Panchayat for a minimum period of seven days. The competent authority is also responsible for the entry of the list in Awaassoft. A window period of 15 days would be provided for the submission of complaints regarding wrongful deletion or change. The competent authority shall enquire into the complaints, prepare a report and submit the same in time-bound manner, the time period for which to be decided by the State/UT, to an Appellate Committee that is to be constituted by the State. The State / UT Government shall constitute a three-member Appellate Committee at the district level which is headed by District Magistrate / Collector.
Release of installments � � The first instalment shall be released to the beneficiary electronically to the registered bank account within seven working days from the date of issue of sanction order. There shall be minimum of three instalments and can have seven stages in house construction �House sanction �Foundation �Plinth �Windowsill �Lintel �Roof cast �Completed
Audit of PMAY-G � � � Accounts at all levels are audited by a Chartered Accountant selected from a panel approved by the C&AG before 31 st August of next year. All the PMAY-G Accounts at all levels shall also be open to audit by the C&AG as well as by the Internal Audit Wing of the Pay and Accounts Office of the Ministry of Rural Development. Social Audit Units (SAU) set up by State/UT Government under MGNREGA, to be roped in to facilitates conduct of Social Audit in PMAY-G. One such audit should be conducted in a year.
Risk Areas in PMAY-G � Refer to CIA – PMAY-G document
Checklist for Internal Audit in PMAY-G � Refer to CIA – PMAY-G document
Risk Matrix SNo Risk High Moderate Low Remarks 1 Blockade of Govt. Money (Financial)(IT) More Than 50% 25 -50% Less than 25% If unutilized balance remains high, it shows in efficiency in estimation of fund requirement thus depriving other district of funds. 2 House not complete even after due period(Operational. Monitoring) Incomplete house shown as complete(Operational) Beyond year Within year high - - 4 Non preparation of BPL/Priority list (Others) High - - 5 House allotted to the beneficiary not as per priority list(Others) High - - 3 one Within six months Houses constructed under PMAY should be completed within stipulated period of 18 months. If it is completed within 6 months or 6 month to 12 months and beyond 12 months of stipulated period. Than risk is involved/ In some cases all the installments are released to the beneficiary without ensuring completion of houses. These houses are shown as complete in the system but actually on verification these are found partially constructed. Gram Panchayat has to prepare priority list annually based on the financial conditions of the beneficiary of BPL category. PMAY benefits are extended to BPL category household by GPs without following priority list. . Now SECC data should be used to prepare priority list and allotment of houses. .
Risk Matrix SNo Risk High Moderate Low 6 Levy of Charges(Financial) Remarks Bank - - Low 7 Opening of multiple Bank Accounts(Others) - Moderate - 8 Non fixing of PMAY Logo/Board(Operational) - Moderate - 9 Non fixing of fuel efficient chullas/ Toilets/Electricity connection. (Operational) - Moderate - Fuel efficient chullaha/ Gas connection under Ujjawal yojana is mandatory for houses constructed under PMAY scheme. . 10 Shortfall in achievement of constructed house as compared to target assigned(Operational) More Than 50% 25 -50% Less than 25% This refers to non meeting the target for construction of houses. i. e. shortfall in construction of houses.
Risk Matrix SNo Risk High Moderate Low 11 Inadmissible administrative expenditure(Financial) High - - 12 Diversion of funds. (Financial) High If recouped in next financial year If recouped in same financial year. 13. Non affording the interest on PMAY balances by banks. (Financial) High. 14 Others 1. Delay in release of state share. (Financial) 2. Non disclosure of PMAY activities proactively in local areas. (Operational) 3. Non recovery of TDS 4. Non observance of purchase procedure. (Financial) As per nature of observations - - Remarks
Thank you
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