In the wake of the raging controversy over the Personal Deposit (PD) Accounts, Special Chief Secretary (Finance) M. Ravichandra has clarified that there is “no mismanagement of finances” in the State.
“The PD Account is a mere nomenclature. They are not opened in the name of any individual. They are maintained for administrative convenience,” he asserted.
Addressing a press conference at the Secretariat on Friday, Mr. Ravichandra said the PDA were opened and maintained in the name of the institution (not in the name of an officer) as per the guidelines issued by the government through GO 43 in 2000.
Also, the PDAs and bank accounts were being used as synonyms, which was not correct. The development works would be impacted if every bill had to be paid through the treasury alone. A relaxation to the norm of payments through treasury was required to avoid possible delay in clearing the bills, he explained.
On CAG’s observation
Referring to Comptroller and Auditor General (CAG) observations on the PDAs, Mr. Ravichandra said, “The CAG misunderstood the concept. The CAG findings are not logical. The government did not deviate from any procedure.” The Public Accounts Committee (PAC) was also apprised of the matter, he said.
Transparency
Also, parking all the funds in the bank accounts was not advisable. It would reflect poor cash management. The government would have to borrow loans at higher rate of interest, while the money deposited by it in the banks would earn meagre interest, or no interest in the case of current accounts. The bank accounts fetch only 3% and 0% on current accounts. The interest charges on loans would not be less than 8%, he explained. Mr. Ravichandra said that all transactions in the PD Accounts were also routed through the treasury and tracked like any other transaction after introduction of CFMS in the current financial year. This resulted in greater transparency, he said. The official said there were 72,652 PDAs in combined A.P. Post-bifurcation, A.P. got 43,374 accounts and Telangana 29,236. Another 13,199 accounts were opened to distinguish the 13th Finance and 14th Finance Commission funds. As the 13th Finance Commission’s period concluded, 13,443 PDAs had been closed. At present, 44,012 accounts were operational. Special Secretary (B&IF) KVV Satyanarayana was present.
