CAG finds 69% of Assam local bodies' funds from central schemes, own revenue at 3%

It covers findings from 207 PRIs and 21 ULBs audited between 2021 and 2024.

Who it concerns: Government of Assam, specifically Panchayati Raj Institutions (PRIs) and Urban Local Bodies (ULBs), including Municipal Corporations and the Social Audit Unit.

What the auditor found

• ₹98 lakh in funds blocked due to unfinished or defunct projects (multi-purpose hall in Morigaon, paver block factory in Hapjan).
• ₹32.56 lakh spent by two Tinsukia Gaon Panchayats on assets built on private land.
• ₹18 lakh spent on a defunct RO-based packaged drinking water plant in Hapjan that has been non-functional for five years.
• ₹10.36 lakh paid for suspicious interior decoration work in Tinsukia.
• Social Audit Unit (SAU) has a 43% overall vacancy rate and a less than 4% recovery rate of misappropriated funds.
• Revenue gap funds intended for asset creation were improperly used for salary payments.
• 51-63% shortfall in audit backlogs for the Director of Audit, Local Fund (DALF).
• Recommendations include ensuring regular SAU Governing Body meetings, finalizing manpower policies, and issuing formal notifications for statutory devolution of functions, funds, and functionaries to ULBs.

Also in the document

• CAG found that 69% of local body resources come from centrally sponsored schemes, while own-source revenue is only 3%, creating high dependency on government grants.
• CAG noted that despite constitutional provisions, there has been no meaningful devolution of functions and functionaries in Assam, limiting local bodies' ability to function as self-governing institutions.
• CAG reported that the Social Audit Unit's registration has expired due to infrequent Governing Body meetings, which also hinder budget approvals and annual account certifications.
• CAG identified that the Government of Assam has not made most recommendations of the 5th State Finance Commission statutorily binding, leading to a lack of meaningful devolution for Urban Local Bodies.