Kohima: In a first, the Nagaland budget for the financial year 2023-24 presented by Chief Minister Neiphiu Rio on Monday highlighted the state matching share for all Centrally Sponsored Schemes (CSS) under various departments.
Addressing a press conference after presenting the budget, CM Rio confirmed that for the first time in the history of the state, the state matching share for all centrally sponsored schemes was presented in the budget.
For instance, in budget 2023-24, the industries and commerce sector was allotted Rs 913 lakh for activities like incentives under startup policy, ease of doing business, upgradation of international trade centres, and various activities of the state Public Sector undertakings (PSUs). This amount included the state matching share of Rs 80 lakh for CSS.
Likewise, the sericulture department was allotted Rs 430 lakh including state matching share of Rs 30 lakh for CSS. Several budget allocations made for the next fiscal year included the state matching share for CSS.
Looking back as to why the state’s matching share on CSS was necessitated to be highlighted, Rio narrated that the financial year 2022-23 started on an uncertain note since the State was struggling with the aftereffects of the pandemic and the damage it had caused to the state finances.
At a time when the State was recovering, he said that the state faced a second kick when the financial tension reached its peak in July 2022. This was when the Finance Ministry gave an ultimatum to all States to release all CSS in their accounts by July 20, 2022, on the condition that the Centre would take back all the funds in the State’s account pending release if the deadline is not met.
At that point in time, the State Government held a total of Rs 728 crore in CSS funds, an amount so high that forced the State to withdraw funds from the Consolidated Sinking Fund to manage these releases.
He said that a positive outcome of this incident was that the State Government was able to discharge almost all the backlog of CSS, which also helped to reduce the accumulated deficit.
The Central Government has made it mandatory for States to release all pending CSS before the next installments are released.
This new procedure now binds the States to release CSS funds along with State Matching Share within 30 days, failing which a penal interest of 7% per annum is charged. Further, delay in the release of CSS funds will result in the blockage of subsequent installments.
He informed that the State government also paid some penalties in the current financial year following the implementation of the new procedure as some departments underperformed.
Presenting the budget speech earlier, Rio said that the State has also implemented the integration of all CSS with the Public Finance Management System (PFMS) portal where departments implementing CSS programmes are required to manage all receipts and expenditures as well as submission of utilization certificates through the portal.
“Under this new system, both the State as well as Central Government have the facility of viewing all transactions undertaken from the Single Nodal Account linked to PFMS. Now, most of the CSS programs have gone into Direct Benefit Transfer mode. Along with the rest of the country, our State has also migrated to this system that will bring more transparency and efficiency,” he said.
He noted that for a state like Nagaland, CSS programmes are of critical importance as they can substantially impact the State, both socially and economically.
As such, it has become necessary for the implementing departments to ensure that they maximize the impact of the activities undertaken. “For this reason, I intend to have in-depth reviews of the implementation of the CSS programs in the State on a quarterly basis. The review shall examine the physical and financial progress of the projects, and the impact they have made on the target areas or beneficiaries. All the concerned departments may accordingly prepare themselves from the start of the next financial year,” Rio said.
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He observed that there is a growing trend of departments neglecting their core activities over the years as a result of which the delivery of government services for the public benefit in various sectors is being neglected.
Excepting some major CSS programs, most departments are paying less attention to their core activities and focusing more on the construction of offices and residential buildings. “This trend needs to be corrected. We have to ensure that the activities of departments positively impact the lives of the public,” he added.
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