NEW DELHI (15 March 2016): Corporate Social Responsibility (CSR) activities have turned out to be a successful experiment as over 75 percent of the amount has been spent in 2014-15, said Finance Minister Arun Jaitley. Adding that corporates could also contribute to Prime Minister's Relief Fund for use during natural calamities. "It is a successful experiment which has started because in the first year over 75 percent of the amount under CSR has been spent," Jaitley said during Question Hour in Rajya Sabha.
"During 2014-15, the first year for CSR, the 2 percent profits of 460 companies comes to around Rs 8,347.47 crore, of which 75.92 percent has been spent for CSR activity during the year," he said.
To a question on how corporates were using CSR money for political activities, Jaitley said, "Obviously, no money of CSR can be spent for political activity. Schedule VII of the Act specifies the 11 categories under which the CSR money can be spent. If anybody is spending the amount outside that schedule, then it cannot be a legitimate CSR activity."
On being questioned whether the CSR spending by private companies is more than public sector undertakings, the Minister said, "during the first year, the spending under CSR is 79 percent for private corporates and 71 percent for public sector undertakings and that for the first year is a good beginning."
He also added "There are a total of 460 companies, of which 409 are in private sector and 51 are public sector undertakings."
On being questioned whether any monitoring was carried out on CSR spending by PSUs, he responded that there is an in-built mechanism, besides a committee set up to review progress of implementation of CSR. He said it is monitored by the Corporate Affairs ministry and penal provisions are also in place. But, it is also the responsibility of board of directors of a company to see that CSR money is being spent. Jaitley said that 51 PSUs have spent 71.03 percent of their 2 percent profits during the first year and what has not been spent is carried forward to the next year.