Bhubaneswar, April 27: Fate of three World Bank-assisted projects hangs in balance because of the government’s failure in submitting the audit report of the Orissa Health System Development Project, which is mired in controversy and corruption allegations.

According to official sources, the World Bank had sanctioned Rs 315 crore of “targeted rural initiatives” for poverty termination and infrastructure scheme focusing on development and livelihood. The government provided funds in the current fiscal’s budget towards its matching share.

However, the fate of the scheme hangs in balance as the World Bank has reportedly stopped funds temporarily because the Orissa government failed to file an audit report on the implementation of the Orissa Health System Development Project. Also, reports of misuse of funds and endemic corruption came to the fore recently through a “detailed implementation review”, undertaken by the World Bank’s department of institutional integrity. The World Bank report also stated that the project’s civil works and equipment components exhibited significant indicators of fraud, including construction deficiencies in buildings that supervisors had certified as “complete”.

The report also mentioned about a the former health minister accepting a bribe of Rs 5 lakh from an order supplier firm for showing favours under the World Bank-assisted scheme. The government has referred the “scam” to the vigilance department and has ordered an audit.

Proposals under two more World Bank assisted schemes (Rs 1,200-crore Orissa Road Development Project and another project for creation of water bodies involving a cost of Rs 1,500 crore) are pending because of the delay in the submission of the audit.

Chief secretary Ajit Tripathy has asked senior departmental officials to pursue the matter with the World Bank authorities.

Launched in 1998, the project was supposed to be completed in five years, however, it overran its schedule.

The delay was caused by the government’s failure to spend the fund amount leading to pruning down of the project cost by Rs 110 crore (actual project cost was Rs 415 crore).