CAG Report on Assam’s NRC

A recent report by the Comptroller and Auditor-General of India (CAG) has identified serious irregularities in the update exercise of the National Register of Citizens (NRC) in Assam, including haphazard development of software that was prone to data tampering and undue profits worth crores amassed by the system integrator (SI) in violation of the Minimum Wages Act.

The CAG report, which was tabled in the Assam Assembly on December 24, examined the logistical arrangements for the NRC update project in Assam, which was started in December 2014 with a deadline for completion in February 2015 and an initial budget of INR 288.18 crore. However, the project faced numerous delays and cost overruns, with the final draft of the NRC being published in August 2019 and the project cost ultimately reaching INR 1,602.66 crore, with an expenditure of INR 1,579.78 crore reported.

Irregularities in fund utilization

The CAG’s test check of records revealed several irregularities in the utilization of funds, including excess and inadmissible payments to vendors. In particular, the CAG found that the amount of wages paid to outsourced staff was 45.59%-64.27% less than what was approved by the NRC coordination committee. This difference in wages allowed the SI to receive an undue benefit of INR 155.83 crore beyond the 10% “reasonable profit margin,” according to the CAG.

Inadequate software development

Information technology firm Wipro Limited was entrusted with one of the prime software installation companies by the NRC Directorate. The CAG noted that secure and reliable software was required for the SC-directed exercise, but as many as 215 software utilities were added to the core software without following the proper process for software development and vendor selection via tendering. As a result, the CAG stated that the intended objective of preparing a valid and error-free NRC was not met despite incurring excess expenditure.

Recommendations

• The CAG has made several recommendations in response to the identified irregularities and inadequate software development. These recommendations include:
• Penal measures against Wipro Limited for violating the provisions of the Minimum Wages Act and for paying data operators less than minimum wages.
• Action against the State Coordinator of National Registration (SCNR) for “excess, irregular and inadmissible payments.”
• Fixing accountability of the SCNR as the principal employer for “not ensuring compliance with the Minimum Wage Act.”

Overall, the CAG’s report highlights the need for improved oversight and transparency in the NRC update project in Assam to ensure that future updates are conducted efficiently and effectively, with due regard for legal requirements and the rights of workers.