THIRUVANANTHAPURAM: The enthusiasm shown by the state government in devising innovative measures like ‘salary challenge’ to mobilise money to the Chief Minister’s Distress Relief Fund (CMDRF), however, has failed to reflect in the management of the collected sum.The fund is incurring losses, revealed an RTI response, apparently due to mismanagement of its deposits with the State Treasuries Department.
The CMDRF had opened 14 fixed deposit accounts in the Thiruvananthapuram District Treasury since June 2019, according to the reply TNIE received for a query under the Right to Information (RTI) Act. Four accounts that matured this year did not get the eligible interest, causing a loss of `79.75 lakh to the fund. One was a deposit worth `250 crore — a portion of the flood relief collection invested on July 3, 2019, for six months at seven per cent interest rate (Account No: 799011600000413).
As per the reply, the interest credited to the flood relief account was only `8.40 crore (as against the entitled amount of `8.82 crore). Though the date of maturity was January 2, 2020, the account was closed on January 13, 2020. But the deposit was denied the eligible SB interest rate for the period — `27.39 lakh. The three other FD deposits, including another tranche of `258 crore from the flood relief collection, were closed beyond the maturity date. The eligible SB interest was denied in all these cases.
The non-renewal of FDs in time is also a cause for worry. An FD worth `250 crore was closed 31 days after the maturity date. If it was renewed in time, the fund would have got an additional interest of `1.48 crore as against the `74.31 lakh it actually received. Treasuries Director Jafar A M told TNIE that he would respond after examining the matter.
It’s a fallout of mismanagement of treasuries: V D Satheesan
“We follow the banking rules and give four per cent SB interest for the excess period of non-renewed fixed deposits. The CMDRF accounts are operated as per the directions of the finance department. I need to examine these particular cases to respond more,” said Treasuries Director Jafar A M.
He said the Treasuries follow the norms of commercial banks on the minimum period required for a deposit to get SB interest. However, as the minimum period prescribed by leading commercial banks is seven days, the director’s claim did not match with the denial of interests for CMDRF deposits. Two of such accounts were closed 10 and 31 days after the maturity date. Congress leader V D Satheesan, MLA, said the mismanagement of CMDRF funds is, in fact, a fallout of the mismanagement of treasuries.
“This is the hard earned money of the people donated for public good. It is a serious lapse that the fund and its interest receipts are handled in a shoddy manner,” said Satheesan.The denial of benefits to CMDRF deposits is quite contrary to the Treasuries Department’s practice of allowing certain welfare fund boards to enjoy the same interest rate for the excess period in their fixed deposits.
E79.75-lakh loss
The CMDRF has opened 14 FDs in the Thiruvananthapuram District Treasury since June 2019. However, four accounts that matured this year did not get the eligible interest, causing a loss of J79.75 lakh to the fund