Thiruvananthapuram: Finance minister Dr T M Thomas Isaac said that the government had never intended to create a 'special treasury savings bank' account to host all the money coming into the Chief Minister's Distress Relief Fund.
He said that a new order revising an August 31 order creating the special account was issued because the first order had created 'some misunderstanding.' Here is what the August 31 order said: "It has been decided to open a special treasury savings bank account to exclusively hold the 2018 festival allowance of government employees and also the other funds received for flood relief."
The September 7 order said the clause that other funds received from the public for flood relief too would be held in the special account had the possibility of creating a misunderstanding. Therefore, the latest order stated that only the festival allowance and the money taken from the salary of government and quasi-government employees will be deposited in the special treasury savings account.
The minister said that there were now two kinds of accounts opened for the deposit of funds to the CMDRF. One, the CMDRF accounts opened in 16 nationalised and other scheduled banks. Two, a special account opened in the State Treasury.
The CMDRF has been traditionally deposited outside the treasury, earlier in the SBT's and now in the SBI's savings bank account. Traditionally, the main source of funds in the CMDRF was the funds allotted in the state Budget. In 2015-16, it was Rs 346 crore. In 2016-17, it was Rs 200 crore. After the floods, the CMDRF's main source of funds is the public.
Isaac said that the devastation had also inspired a massive surge of interest from within and outside the state to be part of the state's reconstructions efforts. "So to ensure hassle-free deposit of funds to the CMDRF, apart from the existing account in SBI, we opened new accounts in 15 other banks so as to give people various payment options," he said.
It was the timing of the creation of the special treasury savings bank account that had created the confusion. It was opened at a time when there were widespread calls to hold all the money that was mobilised for flood relief and post-flood reconstruction in a single account to prevent diversion. Now, Isaac maintains that the creation of a special account was necessitated by procedural formalities and nothing else.
"In the context of the floods it was decided to transfer the Onam allowance of government employees to the CMDRF. This has to be done by reducing the amount in the concerned budget head. It was for this that a Treasury savings bank account was opened in the name of the finance principal secretary. And to open this account, a government order was necessary," the minister said. This caused a misunderstanding, the minister said, and a new order had to be issued to clear things up. "The second order is nothing but a clarification," Dr Isaac said.
Under this order it was stated that only the donations from government employees, and from those grant-in-aid institutions and PSUs should be held in the special account. "In other words, we just made it clear that all other donations can be deposited in various bank accounts in the manner done before," the minister added.
The minister also said that the funds to the CMDRF were not included in the Consolidated Fund of the state, which is the fund from which the government takes money for its expenditure. "This means that CMDRF money cannot be taken out the way money is taken out for routine budget needs. For all major expenditure the cabinet has to first give its sanction. Even the chief minister can sanction only up to Rs 3 lakh. Anything above it would require the sanction of the cabinet. This will effectively ensure that CMDRF funds will not be diverted for other purposes," the minister said.
As on August 8, the CMDRF accounts in 16 banks have together received Rs 1187.57 crore. The amount in the special account is Rs 117 crore.
