THIRUVANANTHAPURAM: The Kerala Government has relaxed the terms for treasury transactions up to Rs1 crore (Rs10 million) with immediate effect by the lifting ‘Ways and Means’ clearance requirement on most transactions, according to a circular issued by the Department of Finance.
The new guidelines issued with a view to streamlining liquidity management of the state said, “The expenditure from the Consolidated Fund of the State by various Government Departments up to Rs1crore for payments to end beneficiaries, i.e, contractors, suppliers & individual beneficiaries would be made without Ways and Means Clearance.”
The government that had been under pressure on the financial front, last month raised Rs4500 crore through long-term state development bonds (SDLs) along with other state governments.
The Kerala Government, which has been hailed for the display of financial discipline in its recently presented annual budget, is set to take forward several large projects outside the confines of budget – through Kerala Infrastructure Investment Fund Board (KIIFB).
The circular said that though the payments above 1 crore would require Ways and Means Clearance, the ceiling will not apply to a long list of regular payments that include salary, wages, honorarium, allowances, pension & other retirement benefits and so on.
It also said that there would be no restriction for transferring Non Plan grant released with the approval of Government to the Special Treasury Savings Bank (STSB) account and from there to bank account of the Grant-in-aid Institutions.
“There would be no restriction on crediting plan fund from the Consolidated Fund of the State to Plan Scheme Treasury Savings Bank (PSTSB) account opened exclusively for Plan schemes,” the guidelines said.
With the new directives coming into force, withdrawal by lottery department from their STSB account for remitting Goods and Service Tax (GST) is also exempted from all treasury restrictions. Also, there would be no restriction for transfer of credit to PWD deposit head of account from Consolidated Fund of the State.
All the bills against Letter of Credit (LOC) would be cleared without any upper limit and Ways & Means clearance and there would be no restrictions on withdrawal of funds by individuals in TSB Accounts and fixed deposits.
The new guidelines have exempted the transfer of credit from Consolidated Fund of the State to treasury account and withdrawal there from by the Local Self Government Institutions, from all treasury restrictions subject to submission of proceedings to bear out the transaction.