: The State government has ordered the public deposit (PD) administrators to withdraw the funds that were released as matching share to Central government grants in Centrally-assisted State Plan (CASP) schemes, and deposit the same in PD accounts.
The government found that Rs.19,610.76 crore is lying idle in 70,924 accounts in 12 banks across the State. This is roughly equal to the borrowings of the government to meet its requirements. The government has been paying an interest of over 7 per cent on its borrowings.
The G.O. 196 issued on Friday said that with a view to correcting this anomaly, it was decided to withdraw all the balances in the form of the fixed/term deposit or savings bank or current account.
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The government ordered the PD administrators to withdraw the same and keep the same in PD accounts. The government also cautioned that action would be initiated against PD administrators under the AP CCA Rules for non-adherence to the instructions, and would be viewed as misappropriation of funds.
“If any department that cannot do so because of Central Government directions or any other specific reasons, the department would have to take specific written permission of the Finance Department on a case-by-case basis.”
Such account should be maintained in the form of savings/current account with the permission from the State government with the barest minimum balances required for their day-to-day administration. In case of non-existence of PD accounts, permission will be accorded to open PD accounts.
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The government, in a study, found that implementing agencies of various government schemes often deposit the releases of the State and Central governments in bank accounts. These funds are kept idle till they actually utilise them. In some cases, the implementing agencies are not in a position to utilise the entire releases and they get converted as fixed deposits. “This leads to parking of funds.”
Yawning gap
For the government, it is a welcome relief as the gap between flow of funds and requirement has been steadily widening. The gap now stands at Rs.6,403 crore. And, the bills to the tune of Rs.1,000 crore are pending payment. While the revenue generated was Rs.58,912 crore, the expenditure touched Rs. 65,315 crore.
The government has already availed a debt of Rs.13,673 crore though it estimated that it would have to borrow Rs. 20,097 crore this year.
The government estimated that the annual deficit would be Rs.4,868 crore. However, the deficit has already touched Rs.6,641 crore.