PMS Scholarship: 50% Tamil Nadu schools skipped, thousands of payments delayed, duplicated, finds CAG audit

Nearly half of the schools covered in a Comptroller and Auditor General (CAG) audit of Tamil Nadu did not utilise key scholarship schemes meant for students from the historically-marginalised Scheduled Castes (SC) and Scheduled Tribes (ST), while thousands of payments were delayed, duplicated or made to ineligible beneficiaries leaving a large number of eligible beneficiaries outside the system.

The audit found that more than 36,000 scholarship payments worth Rs. 7.28 crore were delayed, Rs. 1.61 crore meant for over 3,000 students remained unpaid and applications lacking mandatory documents were approved. Over Rs. 3 crore was also wrongly disbursed from central funds to ineligible beneficiaries

The audit, covering the period from 2017-18 to 2022-23, examined scholarship schemes implemented by Tamil Nadu’s Adi Dravidar and Tribal Welfare Department with funding from both the Centre and the state government. These include the Pre-Matric Scholarship and the Post-Matric Scholarship, awarded to students before and after Class 10 (matriculation).

Apart from studying a sample over over 9,000 scholarship applications, the CAG also analysed data from the Tamil Nadu’s Unified State Scholarship Portal (SSP), a part of TN’s e-governance agency, the TNeGA.

P-Matric Scholarship: Near 50% schools didn’t use

Between 2019 and 2022, an average of 46% of schools across the eight districts selected for CAG audit did not utilise the Prematric Scholarship scheme. For the Post-Matric Scholarship scheme, 39% of schools did not utilise the scheme during the same period.

The audit had also found that a significant share of eligible SC-ST students did not receive scholarships. Between 2019 and 2023, the proportion of eligible SC students who missed out on the Pre-Matric Scholarship ranged from 21% to 52%, while 20% to 29% missed the Post-Matric Scholarship.

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Between 35% and 55% of eligible Adivasi students did not receive the Pre-Matric Scholarship, while 30% to 42% missed the Post-Matric Scholarship.

The CAG report has attributed that the low coverage is partly to inadequate publicity and the failure to identify and reach all eligible students. The audit further found that 2,901 students who had received scholarships between 2017 and 2022 either dropped out or did not receive the scholarship in the following year.

PMS Scholarship: Approvals despite missing documents

The audit scrutinised 9,076 scholarship applications and found that 2,569, or 28%, did not have the required income or community certificates. Despite the missing documents, these applications were approved.

“There was lack of transparency and arbitrariness/discretion in the admission

process by the private institutions in admissions under management quota,” says the CAG report. According to the audit, inadequate checks on such admissions resulted in scholarships being awarded to students who were not eligible.

36,000 SSP scholarships delayed

The audit found delays in scholarship payments in 36,510 cases between 2017 and 2023. The delayed payments amounted to Rs 7.28 crore and took anywhere between one month and more than a year to reach students.

Separately, Rs 1.61 crore intended for 3,530 students remained unpaid after scholarship amounts were returned because the beneficiaries’ bank accounts were blocked, frozen, closed or did not exist.

The CAG also detected instances of duplicate and overlapping payments. In 2022-23, 160 SC students under the Post-Matric Scholarship scheme received the state’s share twice, while course fees were paid twice for 253 ST students. Some beneficiaries were also found to have received multiple scholarships covering the same period.

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Matric Scholarship: Rs. 3.64 crore wrongly paid

The audit identified another major irregularity involving students belonging to the Scheduled Caste Converts to Christianity (SCC) category.

A total of 2,576 SCC students received 60% of their scholarship from central funds, although they were not eligible for the central component of the scheme. The resulting incorrect payment amounted to Rs 3.64 crore.

The CAG also found that Tamil Nadu did not have an effective online system to monitor scholarship applications and payments in real time or to handle beneficiaries’ complaints.

It also flagged the absence of regular monitoring and review mechanisms. The mandatory annual and district-level inspections of private schools were not conducted, limiting oversight of scholarship implementation and admissions.

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CAG recommends tighter checks, faster payments

The CAG made nine recommendations to improve the implementation of the scholarship schemes. These include strengthening publicity and outreach to identify eligible students, making management-quota admissions in private schools transparent, and creating a real-time online system to track applications, payments and grievances.

The audit also recommended identifying students who had dropped out and helping them return to education, strengthening verification of scholarship applications, ensuring timely payments and moving towards Aadhaar-based payments.

To prevent financial irregularities, the CAG recommended introducing safeguards against duplicate and incorrect payments and recovering money wrongly disbursed.

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It also called for action against schools that charge fees above the approved limits and clearer rules to ensure that PhD scholars can receive the prescribed incentive even while availing themselves of the Post-Matric Scholarship.

The Tamil Nadu government told the CAG that corrective action would be taken. The audit report took note of the government’s response.