CAG flags data inaccuracies and financial lapses; Rural Development Department had admitted in 2023 that several eligible beneficiaries were wrongly excluded from permanent waitlist.
December 26, 2025 : The latest report of the Comptroller and Auditor General (CAG) has raised serious questions over the implementation of the Pradhan Mantri Awas Yojana–Gramin (PMAY-G) in Uttar Pradesh. According to the audit findings, hundreds of ineligible beneficiaries received housing assistance under the scheme, while crores of rupees were released in the name of house construction without adequate checks.
The report, tabled in the Legislature on Wednesday, also flagged a cyber fraud incident in which ₹86.20 lakh meant for 159 beneficiaries was diverted to other bank accounts even before the funds could reach the intended recipients. The audit has underlined the urgent need to strengthen eligibility verification, beneficiary validation, and payment security mechanisms across all levels of implementation in the state.
Audit Covers Period from 2016–17 to 2022–23
According to the CAG report, under PMAY-G, families living in kutcha or dilapidated houses are entitled to ₹1.20 lakh in three instalments to construct a permanent house on their own land. Between 2016–17 and 2022–23, a total of 34.71 lakh houses were sanctioned in Uttar Pradesh, of which 34.18 lakh units (98.48%) were officially shown as completed by March 2024.
However, behind this impressive completion rate, the audit has flagged serious discrepancies in beneficiary identification. The report noted that an initial final beneficiary list of 14.47 lakh families was published in May 2016. Subsequently, based on directions from the Centre, a fresh survey was conducted under the Awaas Plus Survey, increasing the number of eligible families to 33.64 lakh by March 2024.
Despite this revised eligibility pool, only 22.29 lakh additional families were actually included in the list, while a large number of eligible households were left out of the permanent waiting list. The CAG has termed this a clear indication of data inaccuracies and systemic flaws. Significantly, the Rural Development Department admitted in October 2023 that many eligible beneficiaries were wrongly excluded due to errors.
Slow Instalment Release Raises Concerns
The audit report stated that the Uttar Pradesh government spent ₹40,231 crore on PMAY-G between 2017 and 2023. Of this, ₹37,984 crore was spent directly on housing construction, while ₹157 crore was shown as administrative expenditure.
However, due to relatively low administrative spending, the state received ₹357 crore less from the Centre, raising concerns about the scheme’s operational efficiency. The audit also highlighted serious delays in the payment process. Nearly 79% of beneficiaries received the first instalment after more than seven working days, contrary to prescribed timelines.
As of August 2024, payments amounting to ₹20.18 crore had not been released to 11,031 beneficiaries, prompting formal objections from the CAG. The report noted that delayed or stalled instalments significantly undermine the objective of providing timely housing support to rural families.
Major Cyber Fraud Case Exposed
One of the most alarming findings in the report relates to cyber fraud in fund transfers. The CAG revealed that assistance worth ₹86.20 lakh meant for 159 beneficiaries was fraudulently transferred to unauthorised bank accounts.
The audit observed that this was not merely a case of financial fraud but a reflection of serious weaknesses in payment systems, banking verification, and data security protocols. The report stressed the need for stricter digital safeguards to ensure that instalments do not “leak” even before beneficiaries begin construction.
Other Departments Also Under CAG Scanner
The CAG report also raised sharp questions about financial discipline across multiple Uttar Pradesh government departments. In the Social Welfare Department, despite savings of ₹342 crore, only ₹40 crore was returned to the Finance Department, while the utilisation of the remaining amount remained unclear. Additionally, ₹115 crore in supplementary grants was found to be unnecessary.
Similar lapses were noted in the Higher Education, Excise, and Vocational Education Departments, where large unspent amounts were neither surrendered nor properly accounted for, even as fresh supplementary grants were sought. The audit also flagged delays of 29 to 49 months in project execution and errors in GST claims and loan management.
CAG Calls for Stronger Oversight
Overall, the CAG report paints a troubling picture of weak monitoring, poor coordination, and flawed financial controls in Uttar Pradesh’s flagship schemes. The audit has called for urgent corrective measures, especially in beneficiary identification, digital payments, and inter-departmental financial accountability, to prevent recurrence of such lapses in future.
