Centre Fails to Transfer ₹3.69 Lakh Crore Cess to Designated Funds: CAG Report

Speedy Summary

• The Comptroller and Auditor General (CAG) has identified a shortfall of ₹3.69 lakh crore in the transfer of cess collections to designated reserve funds by the union government for financial year 2023-24.
• Lapses date back to 1974, covering multiple administrations.
• Major areas noted include investor education and protection, oil industry development, national highway monetisation, health, and education initiatives.
• Largest discrepancy: Oil Industry Cess collected as FY 1974-75 totals ₹2.9 lakh crore; only ₹902 crore (0.3%) transferred to relevant fund up till FY 2023-24.
• Health and Education Cess also saw ₹37,537 crore untransferred from FY 2018-19 to FY 2023-24 across three designated funds despite conflicting claims by the Finance Ministry.
• Other shortfalls identified include:

– Investor Education Fund: ₹2,505.5 crore.
– National Highways Monetisation Fund: ₹5,968.1 crore.

Read more at The Hindu.

Indian Opinion analysis

The findings from the CAG report highlight critical inefficiencies in managing cess collections over decades that span various administrations and ministries. The discrepancy between collected amounts and transfers risks undermining public trust as these cesses were designed for specific developmental objectives such as improving health infrastructure or supporting oil industry growth.

The gaps in accountability-most starkly exemplified in the Oil Industry Development Board case-raise questions about internal governance checks within ministries responsible for fund transfers. while it is indeed encouraging that some measures like an operationalised Oil Industry Development Fund were introduced recently (FY 2024-25), ancient lapses highlight deep systemic issues requiring rigorous reconciliation processes to ensure transparency.

For future implications, addressing these challenges will be crucial not only for promoting efficiency but also maintaining credibility in public finances-a critical factor as India continues ambitious developmental projects with global attention on its governance practices.

Read more at The Hindu.