House Committee cites CAG report, pulls up govt. over skilling programme

1. At a Glance

• Parliament's Public Accounts Committee (PAC), chaired by K.C. Venugopal, examined the CAG's Performance Audit of Skill Development under PMKVY and flagged a severe skills-demand mismatch. [3]
• Tests both static scheme knowledge (PMKVY architecture, ministry, phases) and dynamic parliamentary-oversight mechanics (CAG–PAC audit-accountability loop) — a recurring UPSC theme (Art. 148, 151; DPC Act 1971). [1]
• Core finding: skilling capacity was directed at low-demand trades (retail, apparel, electronics — 40% of trainees) while high-demand sectors like food processing (0.48%) and tourism (3.8%) were neglected. [4]
• Only 41% of certified trainees were placed in jobs, despite the scheme running since 2015. [1][2]

2. Why in the News

• June 4, 2026: PAC held oral evidence with the Ministry of Skill Development and Entrepreneurship (MSDE), examining CAG Report No. 20 of 2025 ("Performance Audit of Skill Development under PMKVY"). [3]
• Reported by The Hindu on June 5, 2026, noting cross-party (Congress and BJP) MPs criticised the government's lack of planning despite the scheme's decade-long existence, and cited recurring fraudulent training certificates. [4]

3. Background & Evolution

• PMKVY launched July 2015 by MSDE as the flagship short-term skilling scheme, to certify youth in industry-relevant skills and link training to employability, aligned with the National Skill Development Policy. [4]
• Implemented in three phases (2015–2022) with a cumulative outlay of approximately ₹14,450 crore. [2]
• Executing agency on the ground: National Skill Development Corporation (NSDC), with State Skill Development Missions as implementation partners. [2]
• CAG conducted audit across MSDE, NSDC, and 8 states: Assam, Bihar, Jharkhand, Kerala, Maharashtra, Odisha, Rajasthan, Uttar Pradesh. [2]
• CAG's Report No. 20 of 2025 tabled in Parliament (December 18, 2025); PRS India published a summary in January 2026. [1]

4. Core Static Facts

Item	Detail
Scheme	Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
Launch	July 2015
Nodal Ministry	Ministry of Skill Development and Entrepreneurship (MSDE)
Implementing Agency	National Skill Development Corporation (NSDC)
Phases audited	Phase I–III (2015–2022)
Total outlay (3 phases)	~₹14,450 crore [2]
Candidates certified (STT/SP)	56 lakh [1]
Candidates placed	23 lakh (41%) [1][4]
Fund utilisation gap	~20% of state funds unutilised (2016–24, as of March 2024) [1]
Aadhaar-attendance compliance	Only 13% of batches (since 2018) compliant [1]
Auditing body	Comptroller and Auditor General of India (CAG) — Art. 148, 149, 151, DPC Act 1971
Oversight Committee	Public Accounts Committee (PAC), Chair: K.C. Venugopal (Congress) [3]

5. Multi-Dimensional Analysis

Economic

• Skewed training toward saturated/low-value trades (retail, apparel) wastes public expenditure without generating matching employment absorption. [4]
• Nearly one-fifth of allocated state funds lay unutilised — indicating both planning and disbursement bottlenecks. [1]

Social

• Only 41% placement means a majority of certified (often first-generation, economically weaker) trainees gained no tangible employment outcome — undermines the "demographic dividend" narrative. [1][4]
• Delayed/unpaid stipends (₹500 payout pending for ~36% of candidates due to bank-account data gaps) disproportionately hurts low-income beneficiaries. [1]

Ethical/Governance

• Recurrent fraudulent placement/appointment letters point to weak verification and monitoring by training partners. [4]
• Low Aadhaar-based attendance compliance (13%) signals systemic monitoring failure enabling ghost enrolments. [1]

Administrative

• Absence of skill-gap analysis before selecting job roles across all three phases — a decade-old design flaw never corrected. [1][4]
• Weak Centre-State convergence despite federal delivery structure (NSDC–State Skill Missions). [1]

Legal/Constitutional

• Demonstrates the CAG–PAC accountability chain: CAG audits under Art. 148/149 (DPC Act, 1971) → report laid under Art. 151 → examined by PAC (Art. 118, Rule of Procedure) for executive accountability to Parliament.

6. Recent Developments (last 12–18 months)

• December 18, 2025: CAG tabled Report No. 20 of 2025 on PMKVY performance audit. [1][2]
• January 2, 2026: PRS Legislative Research published a summary of the CAG report. [1]
• June 4, 2026: PAC (headed by K.C. Venugopal) held oral evidence session with MSDE officials on the report. [3]
• June 5, 2026: Media (The Hindu) reported PAC's criticism of skill-demand mismatch and poor placement outcomes. [4]

7. Prelims Hooks

• PMKVY launched in July 2015 by the Ministry of Skill Development and Entrepreneurship.
• Nodal implementing agency: National Skill Development Corporation (NSDC).
• CAG audit report on PMKVY: Report No. 20 of 2025, tabled December 18, 2025.
• CAG audit covered PMKVY Phases I–III (2015–2022), outlay ~₹14,450 crore.
• Only 41% of the 56 lakh certified trainees were placed under STT/SP components.
• Apparel, electronics, and retail together accounted for 40% of trainees trained.
• Food processing sector: only 0.48% of trainees trained despite high demand.
• Tourism sector: only 3.8% of trainees skilled.
• ~20% of funds allocated to states (2016–24) remained unutilised as of March 2024.
• Only 13% of STT/SP batches (since 2018) complied with Aadhaar-based attendance requirement.
• The Public Accounts Committee (PAC) is chaired by K.C. Venugopal; it is a Parliamentary Financial Committee examining CAG reports.
• CAG's constitutional basis: Articles 148–151; statutory basis: CAG (DPC) Act, 1971.
• PAC comprises members from both Lok Sabha and Rajya Sabha; conventionally chaired by an Opposition MP.

8. Mains Relevance

• GS-II: Parliament and State Legislatures — structure, functioning, Parliamentary Committees (PAC); Government policies and interventions for skill development.
• GS-III: Human Resource Development, employment generation, inclusive growth.
• Sample question stems: 1. "Examine the role of the Public Accounts Committee in ensuring executive accountability, with reference to its recent scrutiny of the PMKVY scheme." (GS-II, 15 marks) 2. "Despite a decade of implementation, India's flagship skilling programme continues to face a demand-supply mismatch. Discuss the structural reasons and suggest reforms." (GS-III, 15 marks) 3. "Discuss the constitutional and statutory basis of CAG audits and their significance in strengthening parliamentary oversight of public expenditure." (GS-II, 10 marks)

9. Related Topics to Study Next

• Skill India Mission / National Policy for Skill Development — the umbrella framework PMKVY operates under.
• CAG of India (Art. 148–151, DPC Act 1971) — audit mandate, types of audits (performance, compliance).
• Parliamentary Financial Committees (PAC, Estimates Committee, Committee on Public Undertakings) — composition and powers.
• Skill Gap Analysis / Labour Bureau Reports — methodology for demand-based training planning.
• Demographic Dividend debate — links employment/skilling outcomes to India's working-age population advantage.
• Aadhaar-based governance systems — biometric attendance in welfare delivery, DBT linkage.
• NSDC and State Skill Development Missions — federal implementation architecture.

10. Common Errors / Trap Areas

• Confusing PMKVY with Skill India Mission (broader umbrella) or Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY), which is under the Ministry of Rural Development, not MSDE.
• Wrongly attributing PMKVY to Ministry of Labour & Employment instead of MSDE.
• Mixing up PAC (examines CAG reports on expenditure) with the Estimates Committee (examines budgetary estimates/economy) — distinct mandates.
• Assuming CAG report findings are the same as PAC's report — the PAC's own report (with recommendations) is distinct from and follows the CAG's audit report.
• Misremembering the placement figure — it is 41% placement of certified trainees, not of all enrolled/registered candidates.