Finance Minister Arun Jaitley today said the mandatory use of Public Finance Management System (PFMS) will help monitor the flow of funds to beneficiaries of different government welfare schemes.
He was speaking at a function to launch the mandatory use of PFMS for all Central Sector Schemes (CSS), which have a budgetary outlay of Rs 6,66,644 crore.
With the capability of providing real time information, the Web-based software app PFMS has tremendous potential to improve programme/financial management, reduce the float in the financial systems by enabling "just in time" releases and also the government borrowings with direct impact on interest cost, he said.
"PFMS...would help in tracking and monitoring the flow of funds to the implementing agencies," Jaitley said, adding that due to the monitoring of funds, "one can know the actual status of utilisation of funds by the multiple implementing agencies of the central and state governments".
The ultimate purpose of implementing any scheme is to ensure that the benefits much reach to the last mile, he added.
In his address to senior officers of the finance and other ministries, Jaitley also talked about implementation of various schemes through Direct Benefit Transfer (DBT) mechanism.
He expressed the hope that soon PFMS will progress towards a government wide Integrated Financial Management System as a comprehensive Payment, Receipt and Accounting System.
Finance Secretary Ashok Lavasa said 13 Central Sector Schemes are under PFMS had picked-up great momentum in the last two years and all the states "are now on board with the central government as far as acceptance of PFMS is concerned".
Over 300 central and state government schemes, he said, are now riding on PFMS and payment of more than Rs 2.91 lakh crore relating to various schemes under DBT has been made through PFMS since 2013.
He said that PFMS has enabled the government in taking forward the DBT initiative with collateral benefits of plugging leakages and eliminating ghost beneficiaries.
Payments to 34.19 crore beneficiaries have been made through PFMS and there are 21.72 lakh programme implementing agencies registered on PFMS.
This has been achieved on the strength of PFMS having an interface with 170 banks including the Reserve Bank of India, the secretary said.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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