Public Finance Management System Has Empowered India To Be Accountable, Responsive and Transparent, Says Nirmala Sitharaman

The Government has revolutionized the technology driven Public Finance Management System (PFMS) that has silently empowered India to be accountable , responsive and transparent. Sitharaman said this while addressing inaugural session at the 44^th Civil Accounts Day function here today. Smt Sitharaman said that PFMS has saved Rs 1 lakh crore for the country. The Finance Minister highlighted that the Public Financial Management System (PFMS) has now come to be recognized as a distinct brand in the field of public finance management at various multilateral and global fora. She stressed that these achievements are not merely symbolic but has had a real and lasting impact on public service delivery system.

Commending the role of Controller General of Accounts , Sitharaman said that not only that it is making nation more efficient and transparent but also more effective in using its public finance. The Finance Minister further said that the job of CGA is unenviable as it is a constant challenge to keep up with technology while being efficient and progressive in outlook.

Speaking on the occasion, Dr. T V Somanathan, Secretary (Expenditure), emphasized that the Indian Civil Accounts Service Organization has proved its IT prowess by enabling PM-KISAN payments to over 8.46 crore beneficiaries directly into their bank accounts through Direct Benefit Transfer (DBT) payments. He commended the service for the efficiency and accuracy with which it places expenditure and accounts data in the public domain for consumption of all stakeholders, at par with global standards.

Smt. Soma Roy Burman, Controller General of Accounts, stated that PFMS has evolved into a useful financial management tool for the government. She assured that the service would constantly strive to achieve new heights in the field of payments, receipts, accounting and internal audit by effective use of digital technologies, and improve fiscal reporting protocol as part of Government Integrated Financial Management System (GIFMIS) for more effective fiscal management.

On the occasion, the Finance Minister also presented the Civil Lekha Samman Awards to the Best Performing Pr. Accounts Offices and Best performing PAO/ZAO (CBDT) Unit . The function was attended by the Dr Ashok Lahiri , Member ,15^th Finance Commission and Retired Controller General of Accounts and Indian Civil Service Accounts officers

About Indian Civil Accounts Service (ICAS)  :

The Union Government initiated a major reform in Public Financial Management in 1976. The Audit and Accounts functions were separated by relieving the Comptroller and Auditor General of his responsibility of preparation of Union Government accounts. The accounting function was brought directly under the control of the Executive. Consequently, the Indian Civil Accounts Service (ICAS) was established. The ICAS was carved out from the Indian Audit & Accounts Service (IA & AS), initially through the promulgation of an Ordinance amending the C & AG’s (Duties, Powers and Conditions of Service) Amendment Act, 1976. Later on, the Departmentalization of Union Accounts (Transfer of Personnel) Act, 1976 was enacted by Parliament and assented to by Hon’ble President of India on 8^th April, 1976. The Act was deemed to have come into force with effect from 1^st March, 1976. Accordingly, the ICAS is celebrating March 1 every year as the “Civil Accounts Day”.

Since its inception the Indian Civil Accounts Organization has steadily grown in stature and now plays an important role in strengthening of governance through excellence in the management of public finances of the Union Government. The mission of the organization is to administer an effective, credible and responsive system for budgeting, payment, accounting and pension disbursements. The aim has been to provide a world class and robust Government –wide integrated financial information system.  Besides, the organization has strived to develop a new paradigm of Internal Audit for improved transparency and accountability. The organization has accorded top priority to the promotion of professional integrity and competence through a dedicated and motivated work force.

The Indian Civil Accounts Organization has been committed to the leveraging of IT for enhancing the efficiency of the payment, accounting, internal auditing and financial reporting systems of the Government of India. The Public Financial Management System (PFMS), launched in 2009, is the flagship project of the organization show casing this aspect.

The Government has positioned the PFMS as a key decision support system not only for tracking of flow of funds to the last beneficiary or implementation level but also to ensure just –in –time release of funds through an effective management of fund float. The Government is looking at PFMS for facilitating effective monitoring and control of unspent balances or parking of funds to check blockade of Government money. In fact, PFMS is now being used as the core IT platform for regular activities of CGA, such as payments, receipts, accounting, expenditure control, management of provident fund and pensions etc.

The achievement of PFMS as the platform for digitization for payments, receipts accounting, tracking of scheme funds are as below:

• Number of Banks integrated: 362
• PAOs on –boarded: 556/563
• CDDOs on –boarded: 1392/1417
• All Central Ministries (except Railway and Defence) integrated for payment and Accounting; over 1800 CS/CSS Scheme on–boarded
• All 31 State Treasuries integrated
• 53 external domain systems integrated
• Over 27 lakh Programme Implementation Agencies registered
• FY 2019-20: 64 crore transactions, amounting to Rs. 19.64 lakh crores effected through PFMS
• DBT amounting to Rs. 1.53 lakh crore paid during FY 2019-20 so far

The feather in the cap for PFMS is the implementation of Central Sector Scheme, PM –KISAN Yojana which was announced in the Interim Budget presented in Parliament in February 2019. Till date the total amount of benefit paid is Rs. 49,250.77 crore through 24.63 crore transactions covering a total number of 8.12 crore farmers. On 2^nd January, 2020 at Tumakuru, the Hon’ble Prime Minister has announced the release of an additional tranche of Rs. 12,000.00 crore to cover 6 crore farmers’ families.

As part of its core function the office of the Controller General of Accounts is responsible for Monthly Consolidation of the Union Government Accounts. A detailed analysis of the monthly trends of receipts, payments, deficit and its sources of financing is presented to the Union Finance Minister every month.

Further, the Office of CGA is leveraging technology to provide flash figures of receipts, payments, and deficit to Ministry of Finance as a tool for quick management decision making. Daily flash figures are provided in the month of March, to enable monitoring of various financial parameters and targets. In tune with the development in best practices, CGA’s office also prepares Provisional Accounts of the Government of India within two months of completion of the financial year. This year has witnessed 25^th anniversary of publication of provisional Accounts.