Political dithering delays launch of e-treasury

The system would increase the efficacy of the government treasury and do away with the hitches in efficient banking operations.

August 21, 2014 11:49 am | Updated 11:49 am IST - THIRUVANANTHAPURAM:

Political indecision is allegedly delaying the launch of the e-treasury system, deemed as a major milestone in modernising and augmenting the treasury banking system in the State.

Finance Department sources told The Hindu that almost all preparations for switching over to the new payment mode had been completed and a political decision was awaited.

The system would increase the efficacy of the government treasury and do away with the hitches in efficient banking operations.

The attempt to delay the launch is being perceived as yet another move to ease the flow of government funds from the treasury to nationalised banks and reduce the treasury as a redundant mechanism that could be scrapped without much ado.

Earlier, the Finance Department had directed the heads of public sector undertakings (PSUs) and other departments to channelise their funds parked in the treasury to the nationalised banks. Contractors of various government works were also given the option to deposit the earnest money deposit in the banks, instead of the treasury, which led to depletion of funds at the treasury.

Once the financial crisis became grim, the government directed the heads of departments and PSUs to retrieve the funds from the banks and park it in the treasury.

Meanwhile, informal parleys are reported to be progressing to facilitate a better interface between the nationalised banks and the treasury. After insisting that the salary of gazetted officers should be routed only through the treasury savings bank, the Chief Minister issued an order three months back that the same system should be emulated in disbursing the salary of non-gazetted officers too. No further steps had been taken on the Chief Minister’s order so far.

The delay in implementing the Chief Minister’s order is also being construed as a move to slowly open the channel between the banks and the treasury. Depriving treasury customers of the latest banking facilities would force them to opt for banks, which would in due course make the treasury insignificant too, the sources said.

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