Government departments and implementing agencies are reported to be sceptical about the norms laid by the Finance Department for releasing funds from the Electronic Ledger Accounting (ELA) system introduced for streamlining the State’s finances from April 1.
The new accounting system was introduced at the fag end of the last financial year on the premise of enhancing efficacy and continuity in absorption of Plan funds set apart for the departments. It was specified that the budgetary allocation should not be transferred to the treasury account without specific authorisation of the Finance Department.
The new system also granted six months, till September 2015, for expending the unspent Plan allocation for 2014-15.
Though the decision went against the conventional budgeting practice of spending the funds within the same financial year itself, it was also hailed as a bid to do away with the practice of ritualistic spending to register high utilisation rate and also stashing away substantial sums in treasury accounts in the name of different schemes.
Routine expenses
Thus, the government was able to net Rs.1,800 crore to meet its routine expenses and also ward off a financial breakdown that was predicted in October last itself.
The departments and implementing agencies, which diligently routed their unspent funds to the new system, sensed trouble only on finding that some of the norms set for releasing the funds were too rigid.
Even a minor change in the original scheme could be sighted as a reason for delaying the release of funds, especially when the government was hard-pressed for resources to meet its committed expenditure, including salary and pensions.
System introduced for streamlining State’s finances
Aim is to enhance efficacy in absorption of funds
