Finance ministry to track fund flow to states

jaitleySimplification of governance, coupled with financial accountability. These are the twin goals of India’s finance ministry’s new initiative to introduce an online mechanism which will track every paisa that the Centre allots to the states for various welfare schemes.

Through this integrated web portal, the central exchequer can track the money throughout the entire process: from the time it is released to when it is received by the beneficiary. This move is expected to stop fund leakages –a major bane for India’s developmental aspirations.

In the current financial year, the Centre is expected to release as much as Rs. 3,00,000 crores (around $50 billion) to state governments.

The change in fund distribution system will also simplify the process of releasing funds. Earlier, the Planning Commission would instruct the concerned ministries to disseminate funds only after state plans were given the final nod in consultation with the state chief ministers.

This move is another step towards abolishing the Planning Commission, as announced by India’s Prime Minister Narendra Modi in his Independence Day Speech on August 15.

While the portal will allow officer of the finance ministry to track funds, no decision to open the portal to the public has been taken as yet.