Sat Jan 18 17:04:40 UTC 2025: **Karnataka High Court Orders CAG Audit of Construction Workers’ Welfare Fund Amidst Mismanagement Allegations**
Bengaluru, January 18, 2025 – The Karnataka High Court has ordered a comprehensive audit of the Karnataka Building and Other Construction Workers Welfare (KBOCWW) Fund by the Comptroller and Auditor General of India (CAG) following allegations of mismanagement and misuse of funds. The court’s directive comes in response to a petition filed by two students, daughters of registered construction workers, who challenged the reduction in educational assistance provided to the children of workers.
The petitioners argued that the government’s October 2023 notification, which slashed annual educational assistance from ₹30,000-₹35,000 to ₹10,000, was unjustified, especially considering the fund holds approximately ₹6,700 crore in deposits earning significant interest. The court agreed, deeming the government’s claim of insufficient funds as “absolute gibberish.”
Justice M. Nagaprasanna’s order also noted concerns over approximately ₹1,100 crore spent on “inadmissible and wasteful expenditures,” including funds allocated to Indira canteens. Previous CAG reports (2013-2019) also highlighted significant mismanagement of the fund. The court criticized the state government for treating the fund, intended for the welfare of construction workers and their children, as the board’s property, using it for wasteful expenditure.
The court quashed the government’s notification reducing educational assistance, emphasizing that such assistance should increase, not decrease, for needy children. While allowing the government to adjust assistance levels to ensure financial sustainability, the court mandated the immediate disbursement of pending educational assistance applications and ordered the CAG to submit its audit report within three months. The lack of accounting for the interest earned on the substantial deposits was also a key point of contention for the court.
First Piper 