FROM: firstname.lastname@example.org DATE: Mon, 17 Jul 2006 01:08:18 +0530 SUBJECT: DOCUMENT: CAG's comments on Goa's Cyberage Scheme
DOCUMENT: Comptroller and Auditor General's comments on the Cyberage Student Scheme ----------------------------------------------------------- EDUCATION DEPARTMENT: CYBERAGE STUDENTS SCHEME 3.3.1 INTRODUCTION: The State Government had introduced the "Computer Literacy Programme (CLP)" in all the Government and the Government-aided high schools from the financial year 2000-01 for the students of VIII to X standards with an aim to achieve 100 per cent computer literacy. Under this programme, the State Government had introduced the "Cyberage Students Scheme" from 2002-03 whereby Government supplied one computer to each of the students, consisting of one monitor, multimedia PC along with uninterrupted power supply (UPS) and necessary accessories with requisite software and one modem, for internet use was supplied to the students. The scheme which was initially started for Class XI students of Science stream was extended to the students of other streams of elevanth standard and also to the students of polytechnic, degree courses, including professional courses/post-graduates, etc, from 2003-04. The Departments of Education and Higher Education together had distributed 28,586 computers by the end of March 2005 on which Rs 77.39 crore was spent during the period 2002-05. The scheme was a 100 per cent State Budget Scheme. The configuration of the computers was decided by the Education Department. The equipment had a warranty of one year, and beyond one year the maintenance was to be carried out by the parents or guardians of the students. The Goa Electronics Ltd (GEL), state-owned company, was the agency nominated for the procurement and maintenance of the computer systems. 3.3.2 FINANCIAL/PHYSICAL PERFORMANCE: During the period 2002-05, the State Government made budget provision of Rs 11.12 crore, Rs 27.02 crore and Rs 51 crore against which the expenditure incurred was Rs 6.13 crore, Rs 20.29 crore and Rs 50.97 crore respectively. During the period 2003-05, the Department supplied 28,586 computers to the students as under: YEAR SCHOOLS/COLLEGES TARGET ACHIEVEMENTS* 2002-03 XI Science 2806 2806 2003-04 XI (all streams) 10629 10629 2004-05 Degree and professional 15151 15151 Total (no of students) 28586 28586 3.3.3. SCHEME IMPLEMENTATION 126.96.36.199 SUPPLY OF MORE THAN ONE COMPUTER TO A FAMILY: Guidelines issued by the Government to the educational institutions did not contain any clause to restrict the supply of one computer per family. The Director of Education had supplied 2806 and 10629 computers to students of eleventh standard science/all streams in the year 2002-03 and 2003-04 respectively. Similarly, the Director of Higher Education had supplied 15151 computers to the students of 42 colleges in Goa such as graduates, diploma holders, professionals etc during 2004-05. A test-check in audit revealed 59 families of students in 44 higher secondary schools and 29 families of the students of 19 colleges were supplied with two computers to these families. Thus, the government decision to give computers to all the students without restricting one computers to each family had resulted in avoidable expenditure of Rs 20.09 lakh on 88 computers and further additions of such cases was also not ruled out. The department stated (September 2005) that a clause has now been included in the Guidelines of the Scheme for 2004-05 restricting supply of computers to the family of the students who do not possess computers. 188.8.131.52 NON-PROVISION OF EDUCATIONAL CDs: Though supply of software, CD, Internet connectivity and training on computers was also envisaged in the scheme, the department did not provide educational CDs as per the Goa Board Curriculum, and connecting to the Internet was also not ensured. In the absence of educational CDs, internet connectivity and training, the complete benefit that was envisaged under the scheme was not extended to the students of the scheme objectives of enabling students to become technology savvy was also not fulfilled. Further, modems provided to 25,780 computers at a cost of Rs 1.28 crore remained idle as Internet connectivity was not ensured. The department stated (September 2005) that under this scheme, the Government had provided basic hardware and software, and other requirements like electrical connections and Internet connectivity are to be procured by the students at their own cost. The reply was not tenable as modem was supplied without ensuring capability of the students to incur the expenditure in obtaining the Internet connectivity, resulting in the uncertainity in utilization of modems on which an expenditure of Rs 1.28 crore had been made. 3.3.4 PROCUREMENT OF COMPUTERS 184.108.40.206 UNDUE BENEFIT TO SUPPLIES DUE TO DEFECTIVE AGREEMENT: The Director of Education placed (November 2003) an order on the GEL for the supply of 10,000 computers through the identified suppliers, to the students of XI standard at a rate of Rs 18,900 inclusive of all taxes and delivery charges. An agreement was entered into with GEL in January 2004 for this supply. The supply order and agreement did not provide for a clause for restricting payment of statutory duties and taxes to the actuals paid. Such a clause was important in a scheme of such a nature, as the computer industry is prone to several changes, both as regards to technology and prices. The Government of India announced a reduction of excise duty on parts and components of computers from 16 per cent to 8 per cent and also removed the 4 per cent special additional duty on personal computers, with effect from 8 January 2004. Government of India further reduced the excise duty on the parts of computers from 8 per cent to nin will effect from 15 January 2004. In view of the reduction of excise duty, the Director of Education took up (February 2004) the matter of reduction of prices of computers supplied with GEL. The company only reduced the price of 537 computers to Rs 17508, and the balance 9463 computers were charged at the original rate of Rs 18,900. The failure of the department in providing a suitable clause in the supply order/agreement for the levy of duties and taxes, prevailing at the time of delivery, resulted in the non-availment of benefits of Rs 34.28 lakh due to the reduction of duties and consequent extra expenditure to that extent. The department stated (September 2005) that the clause on the decrease in taxes and duties was not made in the agreement to claim the benefit of reduction in the duties. It was further stated that the GEL had passed on the benefit of a reduction in excise duties to the Government after the announcement of the Union Budget. The reply of the Department was not tenable as GEL had given an excise duty benefit only of Rs 7.47 lakh on 537 computers instead of a benfit of Rs 34.28 lakh that was to be passed on 1463 additional computers. 220.127.116.11 NON-INVITATION OF TENDERS: The State Government extended the Cyberage Students Scheme to students of the aided colleges, polytechnics, engineering colleges, etc, in February 2004 and, accordingly, the Director of High Education Department has placed a supply order for 15,000 computers to M/s Goa Electronic Ltd i.e. 4500 Pentium IV and 10,500 AMD Athlon on the same terms and conditions as negotiated by the Director of Education for purchases made by them in the year 2003-04. Goa Electronics Ltd, the procuring agency, placed the supply order for 15,000 computers on the same nine suppliers (proportionately) who had supplied to the Education Department in 2003-04 at the old rates agreed as per contracts for 2003-04 supplies. Since there was a fall in the prices of the computers due to reduction in Excise duty, the Government should have advised the GEL to invite fresh tenders for the year 2004-05 to get better quality computers at a much lesser cost or should have renogiated the prices. This resulted in depriving the Government in obtaining better rates or better configuration within the same funds that were expended. 18.104.22.168 FUNDS DRAWN TO AVOID LAPSE OF BUDGET PROVISION: Though the GEL had invited tenders in ks December 2004 for the year 2004-05 for the supply of computers to the Class XI students, the Government delayed finalisation of the bids and in March 2005 ordered fresh invitation of tenders to take advantage of the reduction in duties. To avoid a lapse of the budget provisions, the Directorate of Education sanctioned Rs 23.43 crore for the procurement of 11,000 computers and Rs 15.09 crore were withdrawn from the Treasury on contingent bills. Till July 2005, payemnts had not been made to GEL as the Government had not finalized the tenders. The Department stated (September 2005) that, based on the preliminary estimates, the Government decided to draw 70 per cent of the estimated expenditure on the basis of advance bills from GEL in view of paucity of time for implementing the scheme. The reply is not acceptable since funds were drawn even before the finalization of the contract for the supply of computers. 3.3.5 POOR MAINTENANCE OF COMPUTERS 22.214.171.124 NON-ATTENANDANCE OF COMPLAINTS: The Department had awarded the maintenance contract of the computers under the scheme to GEL since 2003-04. Scrutiny of the records of the GEL revealed that GEL had not attended the complaints relating to computers lodged by students, promptly. It was seen that 1127 complaints registered by 97 higher secondary schools (HSS) between April 2004 to August 2004 were attended to after a delay ranging from seven days to more than two months. These complaints were of the nature of keyboard not functioning, CPU/monitor/mouse/speakers not working, computers not booting, UPS not functioning and application software not working. Though the Monitoring Cell of the Directorate of Education had attended about 7100 complaints registered in teh cell and about 6000 in GEL, it was noticed that no returns were prescribed by the Director of Education for GEL and its supplies, to monitor the efficiency and problems in handling of complaints. The Department stated (September 2005) that complaints were later rectified in a period ranging from seven days to two months from the date of lodging of complaint. Further, the monitoring cell which was constituted in January 2004 in the Department of Education with one officer-in-charge and eight engineers/technicians on contract basis, became non-functional as the services of eight engineers/technicians were terminated between May 2005 to June 2005. 126.96.36.199 PREVENTIVE MAINTENANCE OF COMPUTERS: As per clause 34 (g) of the agreement made in November 2003, by the GEL with the Government, the GEL had to carry out preventive maintenance of the computers once in a quarter and submit the report for each computer in the prescribed format to the Director of Education/Higher education. No such reports were rendered by the GEL to the Department. It was also noticed that the GEL and their suppliers had not carried out preventive maintenance of 13,433 computers and 15,151 computers supplied by the Director of Education/Directorate of Higher Education, during 2003-05. The Department has also not initiated any action for such lapses against the GEL. The Department stated (September 2005) that the preventive maintenance from 2004-05 was carried out by GEL. The reply is not tenable as GEL had admitted (September 2005) that they have not carried out preventive maintenance as they have found the process cumbersome due to non-availability of the students at the location and on account of the large number of installations. 3.3.6 EVALUATION: The evaluation of the scheme was not carried out by the Government at any stage to assess the performance of the programme. The scheme was extended to college students also without getting any feedback from existing beneficiaries. The Department stated (September 2005) that the Government was working upon the modalities to give the task of evaluation to either Goa Unviersity or Goa Institute of Management and the proposals received from them were under scrutiny and the feedback received after evaluation would be made applicable to the sceme from the next academic year. 3.3.7 CONCLUSION: The STate Government had introduced the scheme of supplying computers to students of higher secondary schools and colleges in 2002-05, with the objective of making the students computer literate. Despite issue of computers to 28,586 students, the impact of the scheme was not measurable as the Government had not obtained any feedback or carried out an evaluation, even after three years of its commencement. Deficiencies in the contract resulted in the Department being deprived of competitive and better rates and the benefit of reduction in Excise duty. The system of preventive maintenance and attendance of complaints was deficient. 3.3.8 RECOMMENDATIONS: * The State Government should carry out an evaluation of the scheme and fine-tune it based on the results of the evaluation and feedback obtained. * Agreement with suppliers should be redrafted to ensure the department avails of the benefit due to decrease in duties and taxes. * A complete review of the system of maintenace of computers should be carried out with a view to ensure sustained availability of the assets to beneficiaries on a long-term basis. [SOURCE: Report of the Comprtoller and Auditor General of India. For the year ended 31 March 2005. Government of Goa.