Bhubaneswar: Several private agencies now seem to have made Odisha one of their favourite destinations for making hay while the sun shines at the tax payers’ expense, thanks to the officials of the Odisha State Medical Corporation Ltd (OSMCL) who connived with these firms to make it possible.
The indulgence of the erring officials of OSMCL came to the fore recently in the light of audit reports of the Comptroller and Auditor General of India (CAG) relating to the procurement of sanitary pads by private agencies under the KHUSHI scheme. The scheme was launched by Odisha government in 2018 to supply sanitary napkins to adolescent girls in schools.
Interestingly, the supplier of these napkins who sold the same item at lower rates to other states got far better prices from OSMCL of the Odisha government. The important arm of the state Health department in its final tender process in 2018 selected one M/s Shree Radhe Hygiene Products Pvt Ltd, Pune to procure the pads at a rate of `2.30 per piece.
This firm had given the product at `1.57 per piece to Tamil Nadu in 2017-18 and at `1.78 per piece to the same state in 2018-19. The firm however received a very attractive rate from Odisha government which procured it at `2.30 per piece in 2018-19, leading to an additional payment of `19.39 crore in total by the Odisha government. In January 2018, the government had decided to distribute 17.26 lakh pads to adolescent girls under the scheme.
The CAG audit claimed that the failure of the price negotiation mechanism by the OSMCL officials, acceptance of the quoted price of this firm led to loss of government money. As reported, in similar scheme named Rastriya Kishor Swasthya Karyakram (RKSK), the supplier had given the pads at lower prices.
“The selected firm had agreed to supply the same sanitary napkins at `1.74 per piece under the RKSK in May 2018 and quoted (November 2018) `2.30 for same napkin in a re-tender for KHUSHI scheme. Therefore the committee should have called for price justification and carried out price negotiation accordingly,” the CAG report said.
The CAG audit report said that the OSMCL ignored the prices offered by these firms in other states, giving extra profit to the private agency hired by them. The CAG in its report said that the estimated price submitted by the Expenditure Finance Committee to the Odisha government for budget provision stood at `2.08 per price. The audit report said this was also ignored by the OSMCL officials while awarding the contract to the Pune-based firm.
“The financial cost for supply of sanitary napkins cost under KHUSHI is estimated to be `85.789 crore (approx) per year. This would involve an extra expenditure of `15.29 crore annually compared to the price under RKSK. This aspect was not taken into cognizance while evaluating the price bids,” the CAG report said.
The report claimed that interventions by OSMCL officials to get the best rates (lowest) for government were not used and it offered higher prices compared to other states. “Extra expenditure incurred on this account is a loss to the state exchequer and an undue favour to the supplier,” said the CAG report.
The Health department in its reply to the CAG justified their decision citing inadmissible input tax credit, additional transport cost and extra packaging cost.
The CAG however dismissed the argument and said that it procured the item at unreasonably high rate and did not go for negotiation to reduce the offered price to save taxpayer’s money. The OSMCL also continued to place more orders from the firm, despite the issues raised during the audit.
This clearly demonstrates a well orchestrated plan to siphon off funds from the state exchequer by involved officials. Interestingly, even after the CAG’s report, the government has not thought fit to take action against any official involved in the process yet.
Manish Kumar, OP