Govt fails to pay interest of Rs 11.38 cr under SDRF

Syllad | The Rising MeghalayaOctober 5, 2022

The state government has failed to pay interest amounting to Rs 11.38 crore under State Disaster Response Fund (SDRF).

According to the Comptroller and Auditor General of India (CAG), at the beginning of 2020-21, the SDRF had an opening balance of Rs 47.70 crore.

In addition to Rs 104.00 crore being investment amount pertaining to the period 2015-16 to 2018-19, Rs 53.18 crore (Rs 49.52 crore central share and Rs 3.66 crore state share) was transferred to the Fund.

The report said that the SDRF had an utilized balance of Rs 122.70 crore as on March 31, 2021.

During the year an amount of Rs 82.18 crore was disbursed from the funds under the MH-8121-122, however, no entry was made against the Major Head – 2245-05-911.

“This act of the state government was in contravention of the SDRF guidelines as no expenditure was to be made directly from public account,” the CAG said.

“As the SDRF is an interest bearing Reserve Fund, the liability of interest payment rests with the state government. Non-payment of interest amounting to Rs 1.91 crore resulted in understatement of revenue deficit to that extent,” it stated.

In terms of the guidelines on the constitution and administration of the SDRF and National Disaster Response Fund (NDRF), which was notified in September 2010, the Centre and States are required to contribute to the Fund in a certain proportion.

The contributions are to be transferred to the Public Account to Major Head – 8121. No direct expenditure is to be made from the Public Account.

As per the guidelines, the state government shall pay interest to the SDRF at the rate applicable to overdrafts under overdraft regulation guidelines of the RBI.

The interest will be credited on a half-yearly basis. Further, as per the guidelines, the accretions to the SDRF together with the income earned on the investment of SDRF shall be invested in central government dated securities, auctioned treasury bills and other interest earning deposits with Scheduled Commercial Banks.

In terms of the guidelines, the Centre and the North Eastern and Himalayan States are required to contribute to the Fund in the ratio of 90:10.