Cash-strapped and fund-starved, successive Governments of Telangana State have been eyeing the coffers of the corporate sector, albeit in vain, for fulfilment of their basic responsibilities towards people.
The provision for Corporate Social Responsibility (CSR) under the Companies Act, 2013 has thus manifested as the proverbial goose that lays golden eggs for the rulers, who have been pressuring corporate firms to part with funds.
Meetings are convened by district collectors and top bureaucrats and companies are being called upon to align their CSR activities with the Government projects, industry sources informed.
It has been learnt that, very recently, a meeting was held with pharma company executives, which was addressed by a high level functionary from the Health department.
Representatives of about 20 top pharma companies attended the meeting.
“In the meeting, we were told that our CSR money was Government’s money, and that we would be assigned Government hospitals the maintenance of which we must fund,” a delegate who attended the meeting told, under the condition of anonymity.
“We’re already supporting Government hospitals and schools with equipment donations under CSR initiative, and tried to explain the same. But we were told in unambiguous terms that the Government would determine how funds are spent,” another source revealed.
Field-level officials of the Telangana Pollution Control Board (TGPCB) in certain districts with high concentration of industries too reportedly received instructions from the respective district collectors to seek details such as the net profit for the past five years, fund allocation for CSR, and the sector and location they spent the same in. A format was circulated to all the industries for the same.
A letter was also addressed from the TGIIC around a year ago, to the companies in the Industrial Park, Pashamylaram, seeking funds to the tune of ₹15 crore for development of an approach road from the Outer Ring Road (ORR).
The ₹95 crore road was to be laid by the Roads & Buildings department and funded by TGIIC, but due to COVID and other issues, there had been a cost escalation, the letter said.
Companies Act, 2013 provides that at least 2% of the average net profit in the preceding three financial years should be spent on CSR activities, with priority accorded to local area.
“Our outlay for CSR and activities we take up under it are determined at the beginning of the financial year, and cannot be altered midway through. Besides, the Act does not consider monetary funding to the government as CSR activity,” a company representative said, adding that enforcement of the Act is the Centre’s responsibility.