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LATEST NEWS UPDATES | PAC to finalize report on UPA’s debt waiver scheme today

PAC to finalize report on UPA’s debt waiver scheme today

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published Published on Jan 30, 2014   modified Modified on Jan 30, 2014
-The Times of India


NEW DELHI: The government has accepted before Parliament's Public Accounts Committee that the findings of the Comptroller and Auditor General on UPA's Rs 52,000 crore farm debt waiver scheme were correct. The auditor in its test check had discovered large-scale irregularities where undeserving farmers were given waiver benefit - at least one-third of the total disbursement were found questionable.

On Thursday, the PAC will meet here to give final touches to its report on the debt waiver scheme. The finance ministry has already submitted an action taken report and has accepted CAG's report and irregularities pointed out there.

The department of financial services, under the finance ministry, is coordinating a probe in all such irregularities and have also started recovery of such waiver from undeserving beneficiaries, sources said.

The PAC questioned the government on the schemes shoddy implementation. The secretary, department of financial services has assured the PAC that all cases are being investigated and that the government accepts all issues raised by the CAG.

The CAG had checked almost 1 lakh farm loan waiver accounts in 700 bank branches across the country involving Rs 500 crore disbursements. More than 20% of the total waiver is believed to have been allegedly siphoned off by a nexus of bank managers and micro finance institutions (MFIs).

As per government's records more than 3.20 crore farmers were granted complete waiver of their farm loans till 2008-09. The waiver was intended to help the banks to de-clog their credit disbursement system.

However, since a large number of deserving farmers remained trapped in debt as they were not covered and undeserving farmers cornered the benefits, the banks still had large loans pending, mostly of small and marginal farmers.

The full waiver of loan was meant for farmers possessing less than two hectares of land, but the CAG report revealed the beneficiaries of the scheme constituted many big farmers with large land holdings. Many of the bank branches have been accused of overlooking deserving farmers having accounts in their bank who were denied the benefits of the scheme.

After a directive from the finance ministry, the RBI issued notices to chairmen and CEOs of government banks to register FIRs against bank officials who had tampered with records. The directive also asked them to complete the recovery of such fraudulent disbursements.


The Times of India, 30 January, 2014, http://timesofindia.indiatimes.com/india/PAC-to-finalize-report-on-UPAs-debt-waiver-scheme-today/articleshow/29574465.cms


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