NEW DELHI: The government has made it mandatory to use Public Finance Management System (PFMS) for all central sector schemes to track and monitor the flow of funds to the implementing agencies and ensure the benefits reach the beneficiaries.“It will help plug leakages in the system and help the system manage and maintain data that the government could use to develop more scientific approach,” said Aman Agarwal, director and professor, Indian Institute of Finance.
The central sector schemes with a budgetary outlay of Rs 6,66,644 crore covers over 31 per cent of the total central government expenditure during the current financial year, according to the finance ministry.
The PFMS scheme has been rolled out by the Controller General of Accounts at the behest of the finance ministry, Department of Expenditure. On Friday, Finance minister Arun Jaitley asked all senior officers of the finance and other ministries to make PFMS mandatory for all government schemes like direct benefits transfer. Jaitley added that through PFMS, the actual status of utilisation of funds by the multiple implementing agencies of the central and state governments can be monitored and ensured that the benefits reach the last mile.
PFMS has the capability of providing real-time information on resource availability, flows and actual utilisation. It can help improve programme/financial management, reduce the float in the financial systems by enabling ‘just in time’ releases and also the government borrowings with direct impact on interest costs to the government, said Jaitley.
It will also help minimise the cases of delay and pending payments to a large extent. The finance minister hoped that soon PFMS will progress towards a government-wide Integrated Financial Management System - as a comprehensive payment, receipt and accounting system.
According to finance secretary Ashok Lavasa, 13 central sector schemes are now under PFMS and 300 central and state government schemes are now riding on PFMS. Also, payment of Rs 2.91 lakh crore relating to various schemes under DBT has been made through PFMS since 2013. He said that as on date, payments to Rs 34.19 crore beneficiaries have been made through PFMS and there are 21.72 lakh programme implementing agencies registered on PFMS and have interface with 170 banks including the Reserve Bank of India.
