Journalism of Courage
The coal ministry,which is under the CBI scanner after the CAG report on coal block allocations,has resisted a similar audit of coal supply linkages given to power companies over fear that the Comptroller and Auditor General has pre-decided that benefits were passed on to the private firms.
At the audit entry meeting in August,its officials opposed the CAG teams assertion that there was a general perception that the benefit of cheaper coal has not been passed on to consumers by the IPPs (independent power producers).
The officials told the CAG team that an audit should not base on perception and should not presume that benefits have been given the way it is contended (by the CAG).
Determination of any benefit should evolve from the analysis of sequence of events. Not that events are analysed to establish such benefits, they told the audit party. The preliminary meeting was held on August 26 to discuss the audit objectives,scope and methodology with power and coal ministry officials before starting a field audit of coal linkages provided to projects selected on Case-1 bidding method.
Case-1 projects are those where a developer has to arrange land,fuel and secure all approvals unlike Case-2 where the government provides fuel linkage with coal block allocation and arranges for land and approvals. Under Case-1,firms bid for a project at a pre-fixed tariff considering they would source their own fuel from the open market.
The Principal Director of Audit,Economic & Service Ministries,wants a thematic audit to evaluate the power purchase agreements of Case-1 projects where coal linkages were subsequently provided to companies.
The coal ministry is also apprehensive that this thematic audit which CAG says is merely to assess the quality and practice related to a specific issue across institutions and programmes may turn into a witch-hunt as in the case of coal block allocation.
The CAG report had only suggested that coal blocks could have been allocated more efficiently,resulting in more revenue to the government. Later,the CAGs estimates of revenue loss to the exchequer snowballed into a corruption case with the CBI attributing administrative lapses by the officials.
