No Takeaways: Finmin to track welfare rupees

NEW DELHI: The notoriously-inefficient way India spends taxpayer���s money on creating rural jobs, projects for healthcare and universal education ��� which benefit middlemen and local politicians ��� is set to change soon.

The finance ministry has launched an ambitious project that combines information technology and banking services to the poor that would electronically track every penny spent on welfare schemes till they reach their intended beneficiary.

This would be made possible by transferring money directly from the central government���s coffers to the beneficiary.

The project, called ���expenditure information network��� ��� much like the income-tax department���s electronic repository of information relating to direct taxes ��� would keep a penetrating gaze over when and how much money meant
for welfare schemes reaches the intended beneficiary.

The government is starting the scheme as a pilot project in two states and would extend it to the whole nation in three years.

At present, there is criticism that money on programmes such as rural employment guarantee scheme is recorded as having spent the moment they are cleared by the local authorities for disbursal. This does not ensure that the money has actually reached the worker.

The proposed network will keep a track of how every rupee is spent from the Rs 2,43,000 crore earmarked by the central government this year for welfare measures.

It would also cover the amount that state governments would spend on welfare schemes from the Rs 2,00,000 crore central support to them, Controller General of Accounts V N Kaila told ET. The office of the CGA under the finance ministry is responsible for the internal audit of all ministries.

���Leveraging our strengths in banking and information technology for better programme delivery would ensure direct electronic payment to the ultimate beneficiary.

Under the scheme, only authorisations to spend money will travel along the central and state level bureaucracy
and not the funds,��� he said.

The move would bring the much-needed transparency in utilising public funds and also help in changing the public perception of the effectiveness of such schemes. The country has the bad reputation that far less than a third of its expenditure on welfare schemes reach the ultimate beneficiary.