CAG Audit of HRDD’s implementation of ICT in Schools Scheme reveals how irregularities and disinterested execution held back a Rs. 8 crore project from delivering on its potential
The Information & Communication Technology in Schools Scheme, when it was introduced in Sikkim in the year 2008, was an initiative which had the policy commitment in the right place, but unfortunately, like with several other path-breaking policy interventions here, when it came to delivery, the executive arm of the government came up short. The scheme was launched with the idea to provide secondary school students with opportunities to build their capacity in ICT skills, enhance their education through computer-aided learning and create a level playing field for students irrespective of whether they came from rural or urban schools. Between 2008-09 to 2014-14, the period through which the implementation of this scheme was audited by the office of the office of the Comptroller and Auditor General of India, Rs. 7.95 crore was spent on the project, but, as per the latest CAG Report, “the intended objective was not fully achieved”.The thumbs down is hardly surprising given that the Human Resource Development Department’s implementation of this significant scheme was “characterized by various irregularities such as lack of survey and planning, delay in tendering the project, unjustified re-tendering, appointment of under qualified computer instructors, supply of sub-standard equipment” etc.
The CAG Report tabled in the Legislative Assemby by the Chief Minister recently on 17 March includes a 12-page report on the implementation of the ICT in Schools scheme in Sikkim and enumerates the irregularities and indifference which made a mockery of the scheme with as many as 80 percent of the “beneficiary” schools commenting to CAG auditors that the implementation was not satisfactory.
To start at the beginning – The ICT in Schools Scheme was launched as a centrally sponsored scheme on 90:10 fund sharing basis between the Centre and the State in December 2004. In August 2005, the Computer Education Plan prepared by the HRDD to implement ICT in 103 schools was approved by the Project Monitoring and Evaluation Group of the Government of India and two more schools were included in 2007. Thus, in Phase-I, 105 schools were to be covered. This was in 2008, for Phase-II, a computer education plan for implementation in ICT scheme in 46 more schools was approved.
Implementation of Phase-I was awarded to Computel Systems and Services, New Delhi at a tendered value of Rs. 939.53 lakh for a period of 40 months [from Sept 2008 to Dec 2011]. The contracted company was required to introduce computer education in 105 schools [13 Senior Secondary and 92 Secondary schools] by providing computers and accessories including licensed software. It was also required to continue computer education in 29 senior secondary schools where the scheme was already running and also repair and maintain computers there through the 40 month duration of their contract.
The company was also to appoint computer instructors and arrange for internet connectivity to all schools being serviced by it.
The CAG audit of the scheme was taken up from July 2013 to 31 October 2014 and 34 of the 134 schools where the scheme was implemented were taken up for Stratified Random Sampling for physical verification. Updation of audit findings and test check of records at HRDD office in Gangtoj and schools in districts was taken up in August 2014. Performance was judged against the criteria stipulated in the Notice Inviting Tender, bid agreement documents, ICT guidelines and Sikkim Finance Rules.
Even though the GoI had approved the scheme for 105 schools, the Department went ahead and added 29 more schools to the list without obtaining approval and the scheme began with 134 schools across the State in 2008-09.
The CAG report details that one of the main objectives of the scheme was to provide infrastructure to enable the schools to have an environment for widespread use of ICT. As per the project papers, two of the more anticipated outcomes of the scheme were “widespread” use of ICT in schools “leading to enrichment of existing pedagogy and enabling the students to acquire necessary skill needed for both, higher education and for gainful employment”.
Needless to add, with such high expectations, planning should have been done with full involvement of school authorities concerned, keeping in view the objectives and anticipated outcomes. The Department should have conducted at least a preliminary survey of schools to ensure availability of suitable rooms, possibility of landline phone connection for internet, proper electrical connection and fittings etc.
Further, heads of schools should have been properly briefed about the implementation and objectives of the scheme and what the contracted company was required to provide.
However, no such communication or preliminary survey was done, the CAG Report informs.
The Department also hobbled the scheme with poor fund management. For instance, while the total state share requirement for the scheme [for its duration of three years] was Rs. 97.65 lakh, the Department, after adding 29 old schools to the approved list of 104 schools, worked up the State share to Rs. 3.41 crore in September 2005, and in April 2006, further scaled it up to Rs. 5 crore. The auditors are now reporting that the entire project was delayed due to non-availability of State share brought upon by “unauthorized inclusion” of additional 29 schools. What is more, against the projected State share of Rs. 5 crore, the actual state share released was only Rs. 2 crore! As the Report puts on record: “This indicated unrealistic financial planning which did not commensurate with the requirement”.
The Department sought to dodge this comment on “unrealistic planning” by arguing that the Rs. 5 crore projection was because the funding pattern was in the 75:25 scale at the time as Sikkim was not considered a part of the NEC for project funding at the time. The reply has been rejected by the auditors who point out that while the project was sanction in October 2005 and endorsed by the Programme Monitoring and Evaluation Group in July 2007, Sikkim was already included for NEC funding pattern in 2002-03 itself.
Now, even before the ICT in Schools scheme could get off the ground, the Department diverted funds from this scheme to clear dues owed to a company for services rendered under the CLASS [Computer Literacy and Studies in School] scheme, a scheme which predated the ICT in Schools and under which 29 schools were covered. Yes, the same 29 schools which were added without authorization to the list for the new scheme. The same company, Computel Systems and Services, had worked on CLASS and then was contracted to deliver ICT in Schools.
Even this previous due clearance is confounding because while the company was owed a balance of Rs. 26.55 lakh for its services under CLASS, the Department [in March 2007] “unauthorisedly diverted and paid” it Rs. 66.52 lakh. The diversion was already irregular, and further, it was also Rs. 39.27 in excess of what was owed to the company.
Why was this payment made? The query was also submitted by the auditors. This is how the Department replied: “While accepting the fact the Department stated (November 2014) that the justification for payment of Rs. 66.52 lakh could not be located in the records and efforts would be made to verify the details”.
But this was not the only unauthorized diversion made by the Department from the ICT in Schools funds. The Department also diverted Rs. 38.61 lakh from these funds for purchase of 105 computers for distribution to schools. And then, it spent another Rs. 3.63 lakh from the ICT in Schools fund for purchase of computers, projectors, laser printer, laptop etc for use in Department’s IT section.
On this, the auditors comment: “Since there was already a paucity of fund under the scheme, unauthorized use of fund put a further burden on the scheme”. Even on this, the Department is still making efforts to verify the details on why funds earmarked for computers in schools were diverted to the Department’s IT cell.
And all of this before even the first computer lab was opened under the ICT in Schools scheme.
The project was put to tender in December 2007, and in a decision pegged as “unjustified” by the CAG Auditors, the lowest bid was rejected and the project re-tendered without any negotiation with the firm.
The lowest bid had quoted a rate of Rs. 7.28 crore to operate the scheme for forty months. The irm which eventually bagged the contract had quoted an “exorbitant rate” of Rs. 12.35 crore. The CAG Report goes on to comment that the rejection of the lowest tender in the first round “gave full scope” to CSS, the company which eventually won the contract, to reduce its rate by Rs. 2.95 crore. Even then, the Rs. 9.40 crore for which the work was awarded was still Rs. 2.12 crore more than what the lowest bidder had offered. Interestingly, when CAG auditors sought detailed bids of all the firms which participated in the tender, they were not produced to audit.
Now to the reason why the work was re-tendered. The Department claims that the lowest bid was rejected because the salary being offered the company [Rs. 4,800 and Rs. 6,000] was not attractive to get qualified instructors which in turn would jeopardize the objective of providing quality education. While such proactive concern for quality education would have been welcome if the emotion was consistent, that was not to be the case because the company which won the bid was frequently accused of cheating instructors and paying them as low a salary as a consolidated Rs. 5,000 even as it received an average salary of Rs. 7,500 per instructor from the government!
Also, of the 176 instructors appointed by the firm which eventually attempted to deliver ICT to Schools, 154 were under-qualified. “Hence, compromise on qualification of teachers contradicted the very reason for re-tendering. Further, the agreement did not spell out any penalty clause for recruitment of under qualified teachers,” the CAG Report puts on record.
As per the agreement, the computer instructors, depending on their seniority, were to be paid Rs. 8,500, Rs. 7,500 and Rs. 6,500 per month. Instead, they were actually initially paid monthly salaries of Rs. 6,605, Rs. 5,800 and Rs. 5,020. Within less than a year, from May 2009 onwards, even this was reduced to a fixed amount of Rs. 5,000 irrespective of their qualification or post of appointment. In February 2010, the computer teachers even petitioned the CM with their plea and the issue remained in news for a while. But even though the teachers remained denied, the firm was receiving full amount for their salaries from the Department at an average of Rs. 7,500 per teacher per month; they were just not paying the same to the teachers.
Even if EPF deduction are factored into what the teachers were drawing, CAG auditors have worked out that the firm was retaining with itself an average of Rs. 1.40 lakh per month from salary dues till April 2009 and thereafter Rs. 2.82 lakh per month. Payment of EPF is mandatory for any company hiring more than 20 employees and here, the firm had 176 teachers on its rolls. Audit worked out that senior instructors, instructors and junior instructors, after three years of service, would be entitled to EPF of Rs. 67,964, Rs. 60,545 and Rs. 52,472 respectively. The auditors further found out that the ICT teachers had to send their representatives to Delhi [where the firm was based] to get their money, “and with much bargain”, the firm agreed to transfer funds to their bank accounts. “However, only a meager amount between Rs. 10,300 to Rs. 21,000 was transferred to their respective savings accounts,” the CAG report informs.
On CAG queries, the Department “remained silent” on the re-tendering issue, stated that the question of salaries of computer teachers came up only after the contract period was over and said that the provident fund amount was received by the teachers.
WHAT THE STUDENTS RECEIVED
One might have overlooked the fund mismanagement and even the illtreatment of instructors if the delivery at the school level was exceptional. But that was not to be.
The ICT Scheme was clear in its guidelines for development of proper infrastructure. That is in fact a no brainer because if computers are procured and a commitment made to build an environment conducive for widespread use of ICT in schools, the first requirement will be of space for the computers. The Department, however, had not conducted any survey on availability of rooms for computer labs. As a result, most rooms visited by CAG auditors did not have the requisite ambience and equipment was found in dilapidated condition during physical verification.
The Department tried to argue that a “well furnished” computer lab was not made as it was not part of the scheme during initial implementation and that the tender document was silent on this aspect. CAG auditors find this excuse untenable “as the main objective of the scheme was creation of environment for widespread use of ICT in Schools for which a proper computer lab is vital”.
“Further, the guidelines had provided flexibility in incurring expenditure for items like preparation of labs for computers including civil repairs,” the Report points out.
When the Department remained clueless about the need of proper space for computers, it comes as no surprise that it did not bother to ensure internet connectivity for any of the schools inspected. This, despite the fact that providing internet connectivity was stipulated in the agreement.
So, what did the children learn? As per the agreement with the firm, students of 29 senior secondary schools [who were added later] having already learned the basics of software packages and elementary programming, as per syllabus prescribed for them, were supposed to have been taught front end and back end programming. Interaction with the auditors revealed that they knew neither. The Department explained that such programming was very advanced so the students were taught the basics. But these students had already learned the basics [under CLASS], so repeating the basics was not justified, the auditors have stated.
Learning would have been a challenge for the students not only because of poor infrastructure, but also poor attendance by teachers. The CAG auditors found out that absenteeism among teachers in some cases ranged from four months to 26 months! This, when the entire project was for forty months, of which only 33.5 months were during school months. Average absenteeism among teachers was found to be 29.76 per cent [around 10 months]! Although the agreement allowed for Rs. 500 per day penalty on the company for absence of teachers beyond 15 days, this was never enforced. The students were hence deprived. At Chujachen Senior Secondary School for instance, only theory was taught for the entire duration of the scheme because none of the computers supplied functioned throughout the contract period!
What if the teachers turned up? The equipment would have played spoilsport. Physical verification of 26 schools by CAG auditors revealed that out of 252 computers supplied, 222 [88.09%] were lying non-functional! It was further found out that 41.67 per cent of these computers [105 computers] had remained non functional for periods ranging from nine to 24 months. As per the agreement, the firm was to be penalized Rs 100 per day for each day that the computers remained out of order for periods above five days. Of course, no such penalty was ever imposed.
…AND STILL MORE IRREGULARITES
He scheme was tendered for implementation from 01 September 2008 to 31 December 2011. The general conditions of contract required the firm to ensure that all equipment and teachers were in place in all the schools by 01 Sept 2008. The rate quoted by the firm was on per month, per school basis for 40 months. Scrutiny of records by CAG auditors revealed that all the equipment and teachers were in place only from February 2009. The firm hence, worked on the project for 35 months, but was paid for the full 40 months by the Department.
The Department meanwhile sought to explain this situation by claiming that computer equipment and teachers were in place in all schools by 01 Sept 2008, however their actual use was made only from Feb 2009. Payment hence was made from date of appointment of teachers and installation of equipment, since that is what was stipulated in the tender and not actual use. This excuse however is proven false by documents since challan-cum-receipt on the supply reveals that equipment was received at schools only from Feb 2009 onwards which is also from when teachers were put in place.
It is not as if the Department was not aware of such irregularities. The CAG Report reveals that six months into the scheme, the Department noticed the firm’s irregularities like delay in implementation, recruitment of under qualified teachers, supply of substandard equipment etc and “asked” the firm to rectify the same. However, 18 months into the implementation, none of these irregularities were corrected and some more detected. The Department did impose a penalty of Rs. 84.54 lakh, but shortly after, paid Rs. 40.35 lakh for software, bringing the net penalty imposed to Rs. 44.19 lakh, which, the CAG Report states, was “soft and ineffective”. This was ineffective because the penalty works out to barely Rs. 1,500 per substandard computer [943 computers supplied]. Audit analysis states that this penalty should have been Rs. 85.82 lakh instead.
While the guidelines for the scheme required for monitoring of the scheme through independent agencies like IIT, NIT etc, scrutiny of records by CAG auditors revealed that despite being stressed by the GoI time and again, it was only in December 2010, two years down the line, that the Department entrusted the National Institute of Technology, Ravangla, to evaluate the scheme. Interestingly, although CAG auditors called for the evaluation report submitted by NIT-Ravangla, the Department did not produce it for audit.
Earlier, the Department inspected implementation in seven schools and detected several irregularities [mentioned earlier]. In Feb and March 2010, an inspection committee comprising of officials from HRDD, Finance, IT Department, NIC etc visited a further 26 schools and reported that the firm had “deceived” the Department by supplying inferior hardware [resulting in the Rs. 44.19 lakh penalty]. The CAG report states that these irregularities were detected after 18 months of implementation of a 40 month project. Had a monitoring system been in place as prescribed from the start, these irregularities would have been avoided, the report states. In fact, the GoI had included an amount of Rs. 24,000 per school for monitoring which totaled to Rs. 25.20 lakh for 105 schools. The Department dodged this by stating it was not aware of monitoring funds.
The absence of such monitoring resulted in a situation where evaluation of the scheme’s impact was never undertaken in earnest. The inspection committees were limited in their task to finding discrepancies in infrastructure procurement only, neglecting its impact on beneficiaries. The teachers have a point when they share with CAG auditors that the implementation of the scheme could have been better if school authorities were fully involved and made aware of the details of the scheme.
In its recommendations, the CAG Report suggests that at least a preliminary survey be carried out to ensure availability of rooms for computer labs and possibility of internet connectivity. It has also recommended involvement of school authorities and proper structuring of school syllabus and implementation to entail procurement of quality equipment, proper maintenance and qualified teachers. The final recommendation reiterates need for proper monitoring and evaluation through an independent agency with prompt corrective action and earnest impact assessment.
The Department has accepted the points raised in the CAG audit and informs that proposals have been made for providing regular computer teachers in every school. Efforts, the Department further claims, are also underway to make the computers functional by way of AMC or system upgradation. It has also assured that ICT in Schools scheme will be implemented in remaining schools. What is more, for Phase-II, the Department has included provision for computer hall with proper site preparation, adequate survey before site selection and supply of quality furniture and the best of computers. Now to see how Phase-II of the scheme pans out.