With an idea of minimizing float in the system, the government has anticipated to save as much as Rs 10,000 crore on interest payments through a new mechanism. This will be equal to the amount required to fund Ayushman Bharat, or Modicare.
The government said ‘just-in-time release’ of funds through a finance management platform has cut the amount of money floating in the system, which has resulted in interest savings. It added that the whole idea is to minimise float in the system and funds are now released only when implementing agencies need them. Moreover, out of about 20 lakh government agencies, 1 lakh have come on to the platform.
Besides, the Mahatma Gandhi National Rural Employment Guarantee Scheme would have a float of Rs 50,000 crore - Rs 60,000 crore. That’s now been brought to zero after it was brought on to the Public Financial Management System (PFMS) platform. The PFMS, administered by the Department of Expenditure and implemented by the Controller General of Accounts, is an end-to-end solution for processing payments, tracking, monitoring, accounting, reconciliation and reporting. It provides a unified platform for tracking releases and monitoring their last-mile utilisation.
