Self-employment Schemes

Poverty levels among Scheduled Caste (SC) and Scheduled Tribe (ST) groups remain high at 31.5% and 45.3% respectively, as compared to average poverty levels of 25.7% in rural India. Despite the rapid growth of the economy at the rate of 7%–8% per annum, vulnerable and poorer sections of society do not benefit. Given that formal sector employment opportunities—both in the public and private sectors—are shrinking in rural areas, there is a need to focus on self-employment business opportunities as a means to address poverty among these vulnerable populations. The bank-linked self-employment scheme of the Telangana State Minorities Finance Corporation is one such endeavour. However, the recent Comptroller and Auditor General (CAG) report on the performance of the scheme highlights some of the problems that have led to its underperformance.

A flagship programme for vulnerable groups, the scheme assists beneficiaries in setting up business units. Under this scheme, the Telangana State Scheduled Castes Co-operative Development Corporation has to prepare annual action plans (AAPs) through a bottom-to-top approach. However, the actual practice is that the corporation prepares AAPs without obtaining inputs from the districts. The AAPs were approved by the governments with significant delays ranging from four to 11 months from the commencement of the financial year. The actual release of the budget is further delayed by four to five months. There is a huge gap between the amount approved in the budget and that released every year (many times, to the tune of 50%). The actual expenditure incurred was only 85% of the released amount. Many times, even though the implementing agency did not spend the entire amount, they submitted utilisation certificates, which as per the CAG report, is a misrepresentation of facts. This way, every year, the corporation can show that the targets are achieved in terms of utilisation, but in reality there is no much progress.