Questions PM CARES is unable or unwilling to reply: suspense over price of ventilators grows
Dealing with public funds requires transparency and accountability but the PMO continues to deny information on queries under RTI though there is growing evidence that GOI controls the funds
On 13th May, the Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund’ (PM CARES Fund) issued a press release stating that the 1st tranche of 3100 Crores worth of assistance was now being disbursed.
The release said that Rs 2,000 Crore would be used for purchase of ventilators, Rs 1,000 Crores for assistance to migrant labourers and Rs 100 Crores to support vaccine development.
The statement also said that Rs 2,000 crores would be used to purchase 50,000 ventilators. Back of the envelope calculations showed that this amounted to the purchase price of one ventilator to Rs four lakhs.
Almost a month later, on 15th June, assorted BJP spokespersons and party proxies started posting a picture of a ventilator on social media which had a sticker of “PM CARES” on it. This was followed by claims that 50,000 such ventilators had been purchased and were being distributed to hospitals.
This is where it got more murky.
Curious case of the missing 750 crores
The pictures of the ventilator with the PM CARES sticker circulated was that of a Philips CV200 model. The ventilator has a logo of a Mysore-based company called Skanray.
Skanray’s corporate blog shows that it’s a local company that manufactures ventilators under license from Philips and other companies. The company’s brochure for the CV200 ventilator states that these are being specially manufactured for the Govt of India’s epidemic control program.
I decided to check the listing for the Philips CV200 ventilator on indiamart. com which is India’s largest B2B selling platform.
On Indiamart, the list price for a Skanray Philips CV200 ventilator is mentioned as Rs 2.5 lakhs. Now it is important to note here that this is the listed market rate sans any discount.
The big question here is: why has PM CARES allocated Rupees four lakhs per ventilator when the market value of the same ventilator is Rs 2.5 lakhs?
At the rate of 2.5 lakhs per ventilator, 50,000 CV200 ventilators would have cost Rs 1250 crores. But PM CARES apparently claims to have spent Rs 2000 Crores in procuring them.
What about the missing Rs 750 Crores?
Conflict of interest in auditing
Such seemingly bizarre discrepancies leads one to suspect the accounts of PM CARES. From the start, the Prime Minister’s Office (PMO) has been arguing that PM CARES is a public charitable trust that runs on contributions, and hence, will not be audited by the Comptroller & Auditor General of India (CAG).
On 11th June, the PM CARES website was updated to show that a company called SARC & Associates had been appointed as auditors for the fund on 23rd April. The fact that it took PM CARES over 11 weeks to disclose this is no less shocking.
The auditing company SARC & Associates is headed by a man named Sunil Kumar Gupta.
On Mr. Gupta’s website, you can see that he’s a regular fixture on the govt owned Doordarshan and other news channels where he claims to “educate the youth” about the various policies of the Modi government such as Make in India, Mudra Yojana, MSME policy etc.
Mr. Gupta’s affinity to the Modi govt. is not limited to his TV advocacy. On his Twitter account, Mr. Gupta is seen in photographs with Prime Minister Narendra Modi himself. He also has pictures of him hobnobbing with BJP leaders and Union Ministers such as Piyush Goyal, Anurag Thakur, Kiren Rijuju, Manoj Tiwari, Rajiv Pratap Rudy, and others.
Mr. Gupta has also authored books on the Modi government’s Make in India policy and his Twitter account shows him constantly cheering on and promoting the various policies of the ruling party.
Now, there’s another very strange angle to this.
When PM CARES was set up, a lot of people questioned the need for setting up a separate fund when the Prime Minister’s National Relief Fund (PMNRF) already existed for this purpose. In its defence, the Modi government claimed that PM CARES was set up purely to deal with the Covid-19 pandemic and its objectives are different from those of PMNRF. This defence however fails to wash because the objectives of PMNRF have a wide scope which includes releasing money for natural calamities.
The oldest audited statement available for the PMNRF is from the year 2009-10 onwards. Until the year 2017-18, PMNRF was audited by a firm called Thakur, Vaidyanath, Aiyar, & Co. Even after the Modi government took over in 2014, they continued with the same auditor firm until it was abruptly replaced in 2018-19.
Here’s where it gets murky: In 2018-19, Thakur, Vaidyanath, Aiyar & Co. were replaced with SACR & Associates - the same firm which is now auditing PM CARES.
What’s also shocking is that SARC & Associates were appointed as the new auditors of PM CARES without any competitive bidding process or issuing of a tender document.
The same appears to be the case while appointing SARC & Associates as the auditors for PM CARES - that no competitive bidding process ever took place.
The fact, therefore, is that PMNRF and PM CARES are now audited by the same firm headed by a man with close links to the ruling party BJP.
This is in clear violation of the independence guidelines of the Institute of Chartered Accountants of India (ICAI) which clearly state that “Independence of the auditor has not only to exist in fact, but also so appear to exist to all reasonable persons.”
Private fund or public authority?
I had filed a Right to Information (RTI) application on 29th March with the PMO asking for copies of documents related to PM CARES including the trust deed, the details of the trustees, and other bylaws governing the trust.
In response, the PMO stated that the information cannot be provided as PM CARES does not constitute a “public authority” under the definition of the RTI Act. This is incredibly strange and inaccurate for several reasons. First of all, the RTI Act states that any entity that enjoys substantial funding from the government must constitute a “public authority” under the Act.
Just after the creation of PM CARES, numerous public sector utilities (PSUs) and government entities such as the Indian Railways, ONGC, Ministry of Steel, SBI, Indian Oil, and several others had contributed crores of rupees to PM CARES. Several Members of Parliament also contributed money from their MPLAD funds to PM CARES.
This clearly establishes the fact that PM CARES has enjoyed substantial funding in the form of contributions coming from the government and government-owned entities thus making it a public authority under the RTI Act.
The RTI Act also states that any body controlled by the Central or State government constitutes a “public authority”.
PM CARES is headed by the Prime Minister of India as its ex-officio chairman. Moreover, the Ministers of Home, Finance, and Defense, are its ex-officio trustees. In early-June, the PM CARES website was amended to state that the Joint Secretary (Admin) and Under Secretary (Funds) - both IAS officers - have been appointed as honorary administrators of the PM CARES fund.
It is, therefore, a case of sheer lies on part of the PMO to deny that the PM CARES fund is not controlled by the Central government.
Moreover, the PM CARES fund uses the national emblem of India in its logo and on its website. Section 3 of the State Emblem of India (Prohibition of Improper Use) Act, 2005 states:
3. Prohibition of improper use of emblem.— Notwithstanding anything contained in any other law for the time being in force, no person shall use the emblem or any colourable imitation thereof in any manner which tends to create an impression that it relates to the Government or that it is an official document of the Central Government, or as the case may be, the State Government, without the previous permission of the Central Government or of such officer of that Government as may be authorised by it in this behalf.
The use of the national emblem by the PM CARES fund creates an impression that it relates to the government according to the provisions of this Act.
I’ve sent a notice to the Prime Minister’s Office to clarify their stand on this because the use of the national emblem means that PM CARES is a government entity. And if it isn’t, then both the PMO as well as PM CARES Fund are committing a serious offence under the above-mentioned Act by the unauthorised use of the national emblem.
Why the blatant opacity?
While several activists including me continue to jump through hoops to get information on the PM CARES fund, the biggest question remains: what is the Prime Minister’s Office hiding by stonewalling information on this fund?
The office of the Prime Minister, who is the head of the government, should ideally be setting new standards in transparency and accountability.
This becomes even more important in the middle of an unprecedented pandemic like Covid-19 where the country is adopting austerity measures and every penny needs to be accounted for.
Is a pandemic being used as an opportunity to create a new means of corruption through PM CARES? What exactly is the purpose of a fund that maintains extreme secrecy and blocks every attempt towards transparency?
Does PM Modi actually care or is this another example of an “organised loot and legalised plunder” in the words of former PM Dr. Manmohan Singh when he referred to demonetisation?
Only time will tell.