BHUBANESWAR: The Odisha government has decided to implement the just-in-time funding system (JiTFS) in selected departments for drawal of funds for state schemes to ensure timely spending as per allocation and realtime monitoring of expenditure and fund balance.
Developed a year back, the JiTFS was first implemented for 13 state PSUs and societies this fiscal in the first phase to avoid parking of funds in bank accounts. After the success, the Finance department has now decided to implement it for several state schemes under 31 departments on a pilot basis.
Although Odisha boasts of one of the most advanced treasury management systems in the country, the state continues to face challenges of manual processing of bills and idle parking of funds that often lead to sub-optimal utilisation of funds.
Sources said the JiTFS, a part of integrated fund management system (IFMS), will allow the Finance department to reduce idle cash outside the treasury and optimise borrowing costs. With realtime monitoring of cash balances and expenditure, the administrative burden associated with utilisation and expenditure reporting is expected to be reduced.
The decision, sources said, was taken after the government noticed that the average spending by the departments stood at 38 per cent after the first half of the fiscal despite strict timelines for departments to spend 40 per cent of their budget allocations, besides parking of funds meant for schemes.
JiTFS will be piloted during the remaining part of the current financial year in the organisations and agencies under the departments like Higher Education, School and Mass Education, Water Resources, Panchayati Raj and Drinking Water, Health and Family Welfare, Women and Child Development, Housing and Urban Development, Forest, SSEPD and Mission Shakti, etc.
An official of the department said with the JiTFS in place, the facility to draw the funds directly from the state’s treasury will eliminate the need for the implementing agencies to park funds in the commercial bank accounts and simultaneously allow the agencies to make payments to their payees in real-time.
“The directorate of treasuries and inspection (DTI) will conduct a feasibility study in consultation with respective administrative departments during the pilot phase. From next financial year, funds to these organisations/schemes shall be transferred preferably through JiTFS,” he said.