CAG Report: Can A Poor Family Use 20 LPG Cylinders In A Day?

The Comptroller and Auditor General of India flagged misuse of Prime Minister’s scheme to provide cooking gas to the poor as it found cases of multiple refills by a single beneficiary in a day.

There have been 3.44 lakh instances when two to 20 liquefied petroleum gas cylinders were issued to one beneficiary in a day under the Pradhan Mantri Ujjwala Yojana, according to CAG’s audit.

The scheme, launched in May 2016, provides free LPG connections to women from families below the poverty line, and is aimed at saving the poor from fumes and smoke generated by burning unclean fuels for cooking. The Modi government called it a success, claiming that it achieved the target of distributing eight crore LPG connections seven months before the March 2020 deadline.

CAG report, however, found 19.8 lakh instances of three-nine LPG refills a month among high-consumption households.

Such high daily consumption is not possible for general consumers, and the auditor suspects domestic LPG connections were diverted for commercial use as the price gap between the two is significant. Commercial LPG refills cost more because of higher taxes.

Indian Oil Corporation Ltd. and Hindustan Petroleum Corporation Ltd. replied to CAG that each family’s structure, eating and cooking habits are different, and every household has its unique LPG consumption. “There were no restrictions to prohibit the booking and delivery of more than one LPG cylinder per day,” the two companies responded. They, however, said they have introduced a control mechanism to regulate more than one booking and refill delivery.

The Ministry of Petroleum and Natural Gas, responsible for the rollout of the welfare scheme, told CAG that oil marketing companies have capped the number of cylinders—of 14.2 kilograms each—at per year, and distributors providing offering refills at a higher frequency have been issued show-cause letters. Bharat Petroleum Corporation Ltd., the third state-run company implementing the scheme, detected three cases of diversion, the ministry said.

The CAG recommended cases of high consumption of refills should be regularly reviewed to curb diversion. Based on the audit findings, the entire LPG database and physical records need to be scrutinised to identify and restrict releasing connections to ineligible beneficiaries, the auditor said.

Sustained Usage A Challenge

According to government data, all India LPG coverage increased to 94.3 percent as on April 1, 2019 from 55.90 percent as on April 1, 2014.

The national auditor, however, pointed out that encouraging sustained usage of LPG remains a “big challenge”. For 1.93 crore consumers who completed more than a year on March 31, 2018, the average consumption stood at 3.66 refills a year.

By Dec. 31, last year, 3.18 crore beneficiaries got 3.21 refills a year. Of these, 56 lakh never made a second refill and 33 percent consumed one to three refills, according to CAG audit.

Chhattisgarh had the lowest yearly average refills of 1.61, followed by Madhya Pradesh and Jharkhand at 2.38 and 2.57 refills, respectively.

Oil companies replied that the objective was to provide clean cooking fuel and the huge improvement in penetration is one of the measures of its success. They are promoting 5-kg refills and have identified 10 districts for the mandatory rollout of smaller cylinders on a pilot basis.

The CAG recommended that the beneficiaries in the low-consumption category need to be encouraged for sustained usage as the target of providing connections has been broadly achieved.