PUDUCHERRY: Puducherry stands at risk of losing funds as penal interest for causing delay in transferring the funds meant for centrally sponsored schemes (CSS) to the single nodal agencies (SNA) account.
As per the Ministry of Finance (MoF), state governments should transfer the central share and commensurate state share to the SNA account within 30 days of receiving a receipt of the CSS fund. In case of delay in the transfer, the ministry will charge an interest (w.e.f April 1 2023) at the rate of 7% per annum.
In March 2023, Puducherry received Rs 90.49 crore for 16 centrally sponsored schemes, out of which only Rs 22.85 crore have been transferred to the SNA (as on April 18). According to a source from the Puducherry finance department, the Directorate of Accounts and Treasuries (DAT) which received the central funds has informed the concerned government departments when the funds were received. But the departments delayed submitting a proposal for expenditure sanction for both centre and state share to get them transferred to the SNA account.
For some schemes, the 30-day window has expired which will attract penal interest payable to the central government. For Samagra Shiksha Scheme, the centre released Rs 7.45 crore on March 14, 2023, out of which Rs 6.02 crore was transferred to the SNA on March 31, and the remaining Rs 1.43 crore is pending. Similarly, for modernisation of the police department, the UT received Rs 56 lakh on March 16, 2023, which has not been transferred even after a month. For some other schemes, the 30-day period will end on April 30.
The finance department, after reviewing the CSS on April 18, directed all the concerned secretaries to take note of the communications from the ministry and cautioned about the penalty in case of delay in fund transfer. The department will be responsible if any penalty is imposed by the centre and no additional funds will be released by them for penalty payment, sources added.
Furthermore, a delay in implementing the CSS will also lead to a delay in receiving the second instalment, usually released after three months. Puducherry, being a UT and highly dependent on central funds, has to speed up its operations as the SNA system introduced by the MoF promptly monitors the fund flow and its utilisation unlike the previous system.
The Public Financial Management System (PFMS) division of the office of the Controller General of Accounts (CGA) will issue guidelines regarding the procedure for depositing penal interest by the concerned state governments for the consolidated fund. This was communicated to the chief secretaries of all states and UTs on February 16 2023 by Prateek Kumar Singh, director of the Department of Expenditure under the MoF.