Tuesday, October 12, 2010

GoI Report confirms serious mismanagement and corruption charges against CSIR Leadership

The Audit Report of TCGA (- a Public-Private partnership by IGIB under the leadership of S K Brahmachari) by a Government of India agency have now come to a similar conclusion. It has found that:

1. IGIB did not follow proper procedures in selecting the private partner. It did not call for competitive bids; it instead decided on a private partner based on favoritism.

2. The agreement with the private player (i.e. The Chatterjee Group) was not vetted by a legal expert to ensure safeguarding the interest of investing public funds.

3. There were no terms and conditions for sharing of total revenue by the partners in the agreement except that earned through IP rights (i.e. no agremment on revenues from other sources such as services).

4. The list of equipment (along with cost) to be provided by both parties was not clearly defined. The audit report particularly took note of lack of any clause on the contribution of the private partner.

5. The risk involved to both the parties were not identified or shared in a balanced manner. The liabilities of the private partner was restricted to only Rs 3.5 crores and even that clause was amended later in favour of the private partner.

6. There was no provision for preparation of separate accounts of TCGA and getting these certified from an independent Statutory Auditor for enabling IGIB to periodically review the same.

7. There were no penalty clause in case of any failure on the part of the private partner to comply with the provisions of the agreement and no exigencies were taken into consideration.

8. The private partner was given all rights of all matters, finance, legal, and appointment of manpower of TCGA (the newly formed entity under PPP mode).

9. IGIB did not effectively do any planning for the project to ensure its successful implementation.

The result of the above is that TCGA even after 5 years of its existence is making loss, while it was supposed to show sustainable profit since its second year of functioning. Many crores of public fund has been lost due to delays, corruption and mismanagement.

[Note: The veracity of the above findings of the Audit Report can be checked by asking to make that report public and using RTI Act. Also see this.]

No comments: