The Comptroller and Auditor General (CAG) of India has flagged significant deficiencies in the implementation of the Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKKKY), including the functioning of District Mineral Foundation Trusts (DMFTs), in Chhattisgarh. The audit has pointed to shortcomings in fund management, planning, project execution, procurement practices, monitoring and transparency, raising concerns over the effective utilisation of mineral funds meant for the welfare of mining-affected communities. The findings are contained in the Performance Audit Report on the Implementation of Pradhan Mantri Khanij Kshetra Kalyan Yojana including District Mineral Foundation Trust, which was tabled in the Chhattisgarh Legislative Assembly on Tuesday.

Launched by the Government of India in September 2015, the Pradhan Mantri Khanij Kshetra Kalyan Yojana is intended to finance development programmes for areas and people affected by mining operations through the District Mineral Foundation Trusts. The performance audit assessed the adequacy of institutional arrangements, fund collection and management, project planning and execution, and the monitoring and accountability mechanisms under the scheme.

The audit found significant non-compliance with District Mineral Foundation Trust Rules in the sampled districts. Trust funds were utilised without preparing mandatory annual budgets and annual plans. It also found that ₹1.68 crore was transferred to the State-level District Mineral Foundation Cell in violation of Government of India directions issued in July 2021, while ₹10.82 crore remained outstanding with the State-level Cell as of March 2024.

Although the Trusts utilised ₹4,536.58 crore, accounting for 81 per cent of the available funds, the benefits did not adequately reach mining-affected areas. The audit noted that 754 of the 1,734 directly affected villages (44 per cent) in the 11 sampled districts remained uncovered. It further observed that funds were utilised without preparing master plans, vision documents or annual plans required to ensure sustainable livelihoods for people affected by mining activities.

The report also highlighted delays ranging from five to 65 months in identifying mining-affected areas after the constitution of the Trusts. During this period, works worth ₹1,060.70 crore were sanctioned without formally identifying the affected areas. In addition, the list of directly affected villages was issued through office orders of District Collectors instead of being notified in accordance with the prescribed District Mineral Foundation Trust Rules.

According to the audit, inadequate planning, weak monitoring and lack of due diligence resulted in unfruitful expenditure of ₹41.80 crore on incomplete works and unutilised assets, including Art and Culture Centres, biogas-based power generation plants, poultry units and mushroom production centres. These findings indicated deficiencies in the implementation of projects under the Pradhan Mantri Khanij Kshetra Kalyan Yojana.

The report further observed that ₹30.73 crore from the Trust funds was spent on construction, renovation, beautification works and procurement for various Government offices, although these activities did not fall within the priority sectors prescribed under the Pradhan Mantri Khanij Kshetra Kalyan Yojana.

The audit also pointed to deficiencies in procurement procedures. Implementing agencies procured goods and services worth ₹17.49 crore through limited quotations without inviting open tenders, while procurements amounting to ₹38.82 crore were made without specifying technical specifications, contrary to the provisions of the Chhattisgarh Store Purchase Rules, 2002.

Reviewing the monitoring framework, the Comptroller and Auditor General found that the State Level Monitoring Committee and the State Level Review Committee did not meet with the prescribed frequency. Audit of the websites of 12 sampled districts revealed that key information, including the composition of Trusts, lists of mining-affected areas, details of contributions received, status of works, annual plans, budgets and minutes of meetings, had either not been disclosed or had not been updated. The report also highlighted a shortage of skilled manpower, with all sanctioned posts lying vacant in Bemetara and Mahasamund districts and more than 50 per cent of key posts vacant in Balod, Bilaspur, Raigarh and Rajnandgaon districts.

The report concludes with recommendations to strengthen institutional mechanisms, improve planning and financial management, enhance transparency, ensure compliance with procurement norms, and reinforce monitoring and accountability systems to achieve the objectives of the Pradhan Mantri Khanij Kshetra Kalyan Yojana and ensure effective utilisation of District Mineral Foundation Trust funds for the welfare of mining-affected communities.

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RDJ

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