CAG audit found that India’s flagship skilling programme prioritised certificates over jobs, exposing deep flaws.
For nearly a decade, Indian youth were informed that if they upskilled and obtained certified, they would obtain a job. Under the countest’s flagship skilling programme, the Pradhan Mantri Kaushal Vikas Yojana (PMKVY), the government promised to turn aspirations into employment for a generation of young Indians. Roughly ₹14,450 crore was earmarked between 2015 and 2022. Over 1.1 crore certificates were “issued,” and the dashboard seeed all green.
But behind the numbers lay a hard truth. According to a recent audit report by the Comptroller and Auditor General of India (CAG), the scheme had numerous governance failures, including unreliable verification systems, ghost beneficiaries and duplicate bank accounts, fabricated placement records, siphoning of public money, and inflated success metrics.
The audit also flagged weak IT controls, misaligned training with labour market demand, and financial lapses, raising serious doubts about whether public funds translated into real skills or sustainable jobs.
Training without labour market alignment
The PMKVY was launched in 2015 as a flagship skill development programme under the Skill India Mission, with an aim to build youth job-ready. Over four phases, the scheme planned to offer diverse training options, including short-term training for school and college dropouts or the unemployed, recognition of prior learning (RPL) for individuals with existing skills, and special projects that provide tarobtained training based on specific regional or demographic requireds.
Of the ₹14,449 crore budobtained between 2015 and 2022, ₹10,194 crore was released and ₹9,261 crore utilised. Under the programme, 1.1 crore candidates were certified, with 56.14 lakh receiving short-term training or training under special projects, of whom only about 41% secured placements.
The CAG noted that this sharp gap between certification and employment raises serious concerns about whether the scheme meaningfully enhanced employability or merely expanded paperwork-driven outcomes.
The audit found that PMKVY trainings were not anchored in job-role-specific or district-level skill-gap data, despite such analysis being envisioned under the National Policy for Skill Development and Entrepreneurship.
Instead, training was heavily concentrated in a narrow set of low- to mid-skill roles such as retail sales associates, tailors, sewing machine operators, domestic data entest operators, and general duty assistants. Over 40% of short-term training certifications were concentrated in just 10 job roles, even though more than 700 job roles were approved on paper.
“Unless you have a clear vision of why you are introducing a skilling programme, who the tarobtain group is, and what happens after the training, this gap is bound to happen,” Niranjan Aradhya, programme head of universalisation of education at the National Law School of India, Bengaluru, informed AIM.
The audit also highlighted the absence of a long-term National Skill Development Plan. The scheme was implemented in short phases with modifying guidelines, resulting in inconsistent execution and limited continuity, CAG observed.
Professor Rajeev Gowda, ex-MP and spokesperson for the opposition Indian National Congress, informed AIM that the government lost an opportunity to roll out an effective apprenticeship model.
“The government has failed to crack this alignment problem between industest requireds and the youth’s skillsets, despite years of policy focus. The current situation reflects incompetence, design failures, and a lack of empathy for youth, rather than isolated policy errors,” he stated.
Implementation failures and unreliable outcomes
Serious implementation and verification failures further undermined the scheme. The CAG found that candidates were enrolled without proper verification of age, educational qualifications, or eligibility criteria prescribed under the guidelines.
According to the report, there was no effective mechanism to confirm whether beneficiaries were genuinely unemployed or school or college dropouts—the programme’s primary tarobtain groups. These gaps weakened the integrity of beneficiary selection and skewed outcome reporting.
Placement data, a key indicator of success, was also found to be unreliable. In some states, training partners submitted incorrect or unverifiable placement records.
Using Kerala as a key example, the CAG audit exposed serious convergence and placement failures under PMKVY. The scheme links 20% of payments to training providers/partners (TPs)—including private training centres, industest training institutes, colleges, and other empanelled organisations—to successful placements, but audit verification found widespread falsification.
For one company in Kerala, while the TP claimed 14 placements, the firm employed only five. In two other cases, the companies haven’t employed any of the 35 placements claimed by the TP. Appointment letters, salary slips, and seals submitted by TPs were found to be fabricated. This led to the recovery of ₹22.33 lakh and the blacklisting of agencies in Kerala.
The RPL component, particularly the Best-in-Class Employer (RPL-BICE) model, which allows large employers to assess and certify their workforce’s skills, emerged as a particularly problematic area. The audit identified irregularities in agency selection, weak scrutiny of proposals, unreliable documentation, and inadequate monitoring.
In several cases, there was no clear employer-employee relationship between candidates and certifying entities, undermining the credibility of certifications issued through this route, the CAG report emphasised.
Aradhya stated that simply reacting with “knee-jerk measures”, such as creating training programmes, inevitably leads to a gap becautilize the objectives are not clear. There is often a significant difference between what we invest and the actual outcomes we achieve, he stated.
Governance Gaps and Accountability
The CAG report also highlighted failures in financial management and IT governance. The audit flagged weak controls over Aadhaar-linked identities and bank account details, resulting in delayed or non-payment of incentives to eligible candidates. In some cases, payments were not created directly to stakeholders as required.
The absence of a data retention policy for critical records such as attfinishance, training evidence, and bank details increased the risk of misdirected or duplicate payments. Additionally, NSDC was found to have overcharged administrative expenses and retained interest on scheme funds, both of which were corrected only after audit scrutiny.
The CAG data also revealed serious deficiencies in bank account details, with details of almost 94.53% of candidates left blank. Additionally, out of the remaining 5,24,537 candidates, 12,122 unique bank account numbers were utilized by 52,381 participants, indicating that multiple beneficiaries shared the same accounts.
“Even in cases of utilize of a single account for one candidate (472156 unique accounts for each candidate),” numerous instances of apparently invalid account numbers were found. This included entries such as “11111111111”, “123456”, single-digit numbers, plain text, names, addresses, or special characters. The CAG report stated that there was not enough evidence to prove the identities of the participants.
Meanwhile, the Ministest of Skill Development and Entrepreneurship claimed that payments were created through direct benefit transfer on the basis of Aadhar-linked accounts. However, under PMVY 2.0 and 3.0, payments were successful for only 17.69 lakh, or 18.44%, of candidates.
Financial probity is a cornerstone of democratic governance; without it, public programmes invite suspicion, political analyst Harish Ramaswamy informed AIM. There has also been a lack of effective guidance on how young people should transition from education to skills and then to employment, he stated.
During the audit, the CAG conducted an online survey of 4,330 PMKVY beneficiaries certified between 2019 and 2021, however, 36.51% of emails failed to deliver, and among those successfully delivered, only 3.95% of candidates responded. Of these responses, over three-fourths came from a single email ID or from training provider-linked addresses.
Additionally, IT control gaps persisted even under PMKVY 4.0. Among 9.45 lakh certified candidates, auditors found 175 invalid mobile numbers, 2,263 duplicate mobile entries, over 2.72 lakh null email addresses, and more than 3.08 lakh duplicate email IDs.
Structural Policy Issues Persist
The CAG’s findings suggest that PMKVY prioritised scale over substance. Weak planning, poor convergence, unreliable data, and inadequate accountability mechanisms limited the scheme’s ability to translate public spfinishing into sustainable employment outcomes.
Ramaswamy also blamed bureaucratic complexities and excessive procedural barriers that hinder any meaningful action, and rather erode trust in government schemes.
Former skill development ministers during the period under review—Rajiv Pratap Rudy, Dharmfinishra Pradhan, and Mahfinishra Nath Pandey from the ruling Bhartiya Janata Party—did not respond to AIM’s request for comments at the time of publishing.
On the opposition’s role in raising the issue, Congress’ Gowda stated, “Opposition also does its bit to expose failures across government programmes but often has to rely on CAG and other reports and whistleblowers.”
Meanwhile, the government is now shifting focus from vocational training to AI readiness.
In July this year, it launched the Skilling for AI Readiness initiative, which integrates foundational AI modules for school students and educators, backed by a ₹500 crore allocation to set up Centres of Excellence in AI education. In April, it teamed up with Microsoft to launch AI Careers for Women to empower women to pursue careers in AI.
However, Ramaswamy believes the government should focus on structural reforms to create sustainable job opportunities for the youth than merely launching new initiatives.
Aradhya, meanwhile, has strong reservations about introducing vocational education at an early stage. “We are not even allowing them to have a minimum education of 10 years or 12 years, which is really very important for any individual to achieve.”
India continues to struggle with the skills gap, with a Mercer Mettl report released earlier this year revealing that employability among Indian graduates dropped to 42.6% in 2024. When it comes to vocational training—essential for manufacturing growth—only 4.1% of Indians received formal technical training, according to the Periodic Labour Force Survey (2023-24).
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