A report by the Comptroller and Auditor General (CAG) of India reveals financial irregularities amounting to Rs 1,548 crore in public sector undertakings (PSUs) functioning within the department of telecommunications for the fiscal ended March 2008.

In the absence of these financial irregularities, the six PSUs would have enhanced their cumulative profits by a third of what they made in 2007-08, which was around Rs 4,730.33 crore.

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This resulted in extra expenditure of Rs 1,089 crore as the deferential interest on the unretired government loan.

BSNL also enhanced the maximum permissible limit of productivity-linked incentive of its employees from Rs 12,500 to Rs 25,000 which resulted in an excess payment of Rs 20 crore for 2005-06.

“The point to be noted is that these decisions were not simple miscalculations but deliberate unauthorised decisions which are not within the scope of the board. The possibility of recovery is also very limited,” said KP Sasidharan, director general, commercial, CAG.

Similarly, MTNL has been pulled up for “idling investment” of Rs 16.24 crore owing to a failure to comply with the Mumbai Municipal Corporation for construction of hostel building.

Moreover, a marginal sum was also lost because MTNL failed to avail cheaper Bill Mail Service provided by the Department of Posts and dispatched bills through ordinary posts at higher rates.

Other irregularities included continuation of telephone facilities despite non payment of dues, extra payment of productive-linked incentive, idle investment on construction and avoidable payment of spectrum charges.

The CAG report has been tabled in Parliament and further action will be recommended by the Committee on Public Sector Undertakings (COPU) for detailed examination.

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