According to the details of the report, the International Fund for Agriculture Development (IFAD) in partnership with the World Food Programme (WFP) had designed a ‘jeevika’ project for the victims of the January 26, 2001 earthquake.

The objective was to provide long-term livelihood security to the economically vulnerable households in the districts of Patan, Kutch and Surendranagar. Out of an estimated project cost of Rs 112.80 crore, Rs 70.50 crore was to be taken as loan from IFAD , while the remaining Rs 42.30 crore was to be received from others agencies.

SEWA was identified as the implementing agency for the scheme and the target group were the women drawn from the poorest and the most vulnerable groups in the community.

To implement the project, the Union Government had entered into a project loan agreement in February 2002 with IFAD.

As per the agreement, the state government was responsible for monitoring and reviewing the project, and had signed an agreement with SEWA for implementing the same.

According to the report, SEWA incurred an expenditure of Rs 12.78 crore from the beginning of the project till December 2005. It received a sum of Rs 9.67 crore between December 2002 and September 2005.

An inspection of the records of the Commissioner of Rural Development by the CAG in November 2006, however, revealed that its implementation was slow. CAG also found that the state government had received adverse reports against SEWA, but had failed to take action to monitor and review the project, a duty assigned to it by the Centre.

Meanwhile, the IFAD team reviewed the progress of the project in January 2005, and expressed concern over the high administrative expenditure of 40 per cent against the permissible limit of 12 per cent.

Out of Rs 9.67 crore reimbursed to SEWA, Rs 2.90 crore pertained to administrative expenditure, against a limit of Rs 1.16 crore. This resulted in overpayment in the form of an excess reimbursement of Rs 1.74 crore.

Subsequently, an independent auditor appointed in April 2005 pointed out several financial irregularities aggregating to Rs 33.24 lakh. When the state government adjusted the amount from SEWA’s grant, the latter withdrew from the project in October 2005.

With SEWA withdrawing from the project, the state government, in March 2006, also decided to pull out and informed the Centre about it. It was accepted by IFAD as well, resulting in premature termination of the project and without any benefits to the targeted group.

Though the Commissioner of Rural Development informed the CAG that the issue of recovery of excess reimbursement of administrative expenditure would be taken up at the higher level, CAG termed the reply as untenable, as according to it, effective control was not exercised on SEWA despite the state government receiving adverse reports.