Sushasan and The Economics of Corruption - Part I

July 28th, 2010



Many people believe that Bihar has undergone unprecedented transformation from Lalu’s “Jungle Raj” to Nitish’s “Sushasan” meaning good governance. In support of this belief it is cited that the rule of law has been now established, criminal activities have been restrained, girls education and health support system have received tremendous boost, potholed roads are now a history, and the overall increased economic activity has catapulted Bihar’s growth rate to over 11% (2nd highest in the country) in the backdrop of no mineral deposits, no industries, loss of agricultural output due to successive floods and a history of bad governance. The “Sushasan” has brought several accolades and awards to Nitish Kumar.

However, the recent findings in the report of Comptroller and Auditor General of India (CAG) relating to irregularities in treasury withdrawals are shocking. CAG has pointed out that during the financial years 2002-03 to 2007-08, the expenditure details of only Rs.511.90 crore have been submitted whereas the total treasury withdrawal amounts to Rs.11924.44 crore. This means there is no trace of remaining Rs.11412.54 crore. Another CAG report has pointed out that an additional sum of Rs 2,384.04 crore was withdrawn from Bihar treasuries during financial year 2008-09, but bills worth only Rs 77.27 crore were submitted to the Accountant General-Bihar. This leaves a sum of Rs.2306.77 crore unaccounted. The CAG report has also pointed out several irregularities in the expenditures shown. Sample it: (1) foodgrains meant for flood victims were transported by trucks of given registration numbers - payments were made to the transporters - on enquiry it was found that the registration numbers given were not of trucks but of scooters, motor-cycles and jeeps. (2) 298 women in Bihar have delivered two to five children in a span of 60 days during 2008-09 for which they have been paid Rs.1000 each time under Janani Suraksha Yojana. (3) and so on …

Hearing a PIL, Patna High Court has ordered CBI inquiry for these financial lapses. Opposition parties like RJD, LJP, Congress and Left Parties have called it a big “scam” and have agitated within the assembly and on the streets supporting CBI inquiry and demanding resignation of Nitish Kumar and Sushil Modi. The government, however, have defended it saying that there is no “scam” or “financial irregularity”. It is simply a matter of delay in submission of vouchers for details expenditures made. This is not unique to Bihar and it happens in all the states and the central government. Hearing on government’s plea, the Patna High Court has deferred its order on CBI inquiry till the final judgement is pronounced.

Meanwhile, Bihar government is working on war footing to prepare and submit the detailed bills and vouchers for Rs.11412.54 crore unaccounted treasury withdrawals to Accountant General, Bihar. What is unfortunate is the TV coverage showing how large scale fake bills are being prepared by the Govt Staff in collusion with suppliers, contractors, shopkeepers etc. The comments on this state of affairs by ruling party politicians given to various TV channels are equally shocking. Instead of their commitment to immediately stop the mass scale preparation of fake bills, they simply say — “all the bills and vouchers submitted will be examined by the Accountant General and if anything is found wrong in the bills, government will take action“. Inspite of being shown explicitly by TV channels, the honourable politicians of ruling party have categorily denied anything wrong being done in the preparation of bills and vouchers.

It should be noted that the CAG report on the financial irregularities dates back from 2002 to 2009 spanning both the governing regimes referred to as “Jungle Raj” and “Sushasan”. So, whatever be the quality of governance, the reported financial irregularities should be taken for granted as normal.

Now, look at the published data of unaccounted money drawn from treasuries: 2002-03 (324.20cr), 2003-04 (513.28cr), 2004-05 (864.17cr), 2005-06 (2181.77cr), 2006-07 (3718.28cr) and 2007-08 (3810.84cr). The total for these six financial years comes to Rs.11412.54 crore.

The data clearly shows that year-by-year more-and-more financial irregularities are being committed. Does it not mean that this practice amounts to corruption? If so, then how is the state of Bihar growing economically?

—- to be continued in Part II

Dr P R Prasad, Patna

Nitish Intervenes - Imminent Constitutional Crisis Averted

June 18th, 2010



In recent times, media reports relating to university administration in Bihar have remained in focus for reasons of controversies.

The universities in Bihar function under the Chancellor (Governor of Bihar) under relevant Acts and HRD department of Govt of Bihar funds the universities. Since the funds are provided by the Govt, it has the right to ensure proper functioning of the universities in public interest.

Under the cover of this principle, the HRD department started issuing orders directly to the universities’ functionaries with sheer disregard to Chancellor’s orders. Continuation of HRD department’s this activism to streamline higher education not only created a stand-off between the Governor and HRD department, but also headed towards imminent constitutional crisis.

Thanx to chief minister Nitish Kumar who visualized the gravity of the situation, met the Governor to resolve all the controversial issues, and the constitutional crisis was thus averted. It is reported that the HRD department has now withdrawn all the controversial orders and letters regarding the derecognition of the appointments of vice-chancellors of Magadh University, and Veer Kuer Singh University (VKSU) and also the overruling of the order of the chancellor sacking the pro vice-chancellor of the VKSU. The Govt’s order freezing the VKSU bank account has also been reportedly withdrawn.

It is known that the higher education in the state is not in order, but executive orders just at the vims of bureaucrats should not be used to disrespect the provisions of the law and the relevant Acts and Statutes. Anything that is not in order and not in public interest in the eyes of Govt, should be addressed in accordance with the provisions of the law and the rules of the procedure. It is surprising that even the minister concerned allowed the situation to drift to such an extent that the HRD secretary started over-ruling the orders of constitutional head of the state. This is definitely not the right way to administer and is a reflection of bureaucratic arrogance.

Recent newspaper reports indicate that the HRD department has started the process to demote some 2000 odd university teachers who “managed to get promotions” by “getting their pre-absorption service period included in the calculation of length of the service required for promotions”. It is also reported that the Registrar of VKSU has now been charged with defalcation and diversion of money in 2003. This has been done reportedly at the behest of Pro-VC of VKSU who has been transferred after CM’s meeting with the Governor.

Well, without going into the merit of the newspaper reports and government’s orders, I am inclined to believe that all is not well with the higher education and universities in the state; and the government as well as the vested interests in the academic fraternity, in one way or the other, have remained a party to the chaos in university administration.

Dr P R Prasad, Patna