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Last modified at 03/04/2016 13:24 by Vanijyasachivalaya

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​​PROCEEDINGS OF THE GOVERNMENT OF KARNATAKA

S​​ubject : Release of Funds – Delegation of Financial Powers during FY16-17

REA​​​D:

1. G.O. NO. FD 11 TFP 2007 dated 27.11.2007
2. G.O. PD 5 IMM 2010 dated 03.04.2010
3. O.M. No. FD 04 BPE 2016 dated 31.3.2016
4. G.O. No. FD 04 ZPA 2013 dated 10.4.2013 read with Addendum No. FD 4 ZPA 2013 dated 1.4.2016

​PREAMBLE:

In Government Orders issued from time to time, financial powers for release of funds have been delegated to Principal Secretaries and Secretaries of Administrative Department.

For the FY16-17, it is felt necessary to continue with the system of delegation of financial powers of release for Administrative Departments while at the same time ensuring that such delegation is exercised by departments in letter and spirit.  Since the purpose of delegation is ultimately to ensure more effective utilisation of funds, some administrative checks are expected to be exercised by departments before making the release of state plan schemes and other centrally sponsored schemes.  Hence the following revised order is being issued.

This order covers release of funds for both revenue expenditure and capital expenditure during the financial year 2016-17.  The delegation in this order should be exercised by Principal Secretaries and Secretaries to Government and should not be delegated further.

​​​GOVERNMENT ORDER No.FD 3 TFP 2016, BANGALORE, DATED 02.04.2016

​​​Part I – Administrative approval:

    1. ​Funds can be released only for those schemes which have been approved as ongoing or new schemes during a financial year.  The norms and procedures for approval of ongoing schemes, including modification or addition of a new component, and for new schemes along with detailed guidelines for monitoring have been prescribed by Planning Department in Government Order at reference 2.  This should be read with any further instructions that Planning Department may issue during FY16-17.
    2. The order for administrative approval should not be construed as an order for release of funds.  There should be specific orders for release of funds as per the delegated powers for various approved schemes.
    3. Administrative approval for estimates of works upto Rs. 10 crores and procurement of goods and services up to Rs. 5 crores can be accorded presuming concurrence of Finance Department (subject to following the provisions of the KTPP Act).

​Part II – Release of funds requiring specific prior concurrence of Finance Department

4.​  Concurrence of Finance Department should necessarily be obtained for release of funds for the schemes/class of schemes listed at Annexure-1A, 1B & 1C of this Government Order, irrespective of the time and amount of release.

5.   Part IV of this G.O. will not apply to all provisions of Rs.10 Crore and above made through supplementary estimates.  Therefore they will require specific concurrence of Finance Department for release of funds.

​​Share Capital and Loans

6. For release of Capital Expenditure in the nature of share capital and Loans, with budget provision of less than Rs. 10 Cr in a Financial Year, funds can be released upto budget provision presuming concurrence of Finance Department subject to Administrative departments following Transaction of Business Rules 1977 and G.O. No. 1 BLA 2013 dated 26.11.2013 issued by Finance Department in this regard.  However, Government equity for Railway Projects may be released upto 75% of the budgetary provision presuming concurrence of FD.

​​​Part III – Release of funds by Administrative Departments presuming concurrence of Finance Department.

7. For the items of expenditure listed in Annexure-2, funds can be released upto the budget provision presuming concurrence of Finance Depatment. Release of funds over and the budgetary provision for these schemes, including those pertaining to social security pensions etc. shall only be with prior concurrence of Finance Department.

​​​State Schemes with budget provision of less than Rs. 10 crore:

8. For the state schemes with budget provision of less than Rs. 10 Crore, the budget provision should be released in at least two tranches.  The first release may be made upto 50% of the budget provision.  The remaining 50% can be released only after utilisation of 75% of earlier releases(s) including any opening balance.

9. All provisions of less than Rs. 10 crore approved through the supplementary estimates can be released by the administrative departments as required, presuming concurrence of Finance Department.

​​Part IV – Schemes with budget provision of Rs. 10 Crore above:

​Monthly releases during first three quarters

10. Notwithstanding norms prescribed for other schemes in this order, release of funds upto one-twelfth of the applicable budget provision for the following schemes may be made by the administrative departments in each month during the first nine months of a financial year presuming concurrence of Finance Department.
a. All schemes of Public Works Department (Plan and Non Plan)
b. All schemes of Major, Medium and Minor Irrigation (Plan and Non-Plan) provided that in respect of major and medium irrigation it would be subject to raising of extra-budgetary resources (EBR) as per the plan approved in consultation with Finance Department.

For (a) and (b) above, SCSP-TSP releases shall also be made monthly at the rate of 1/12th of the SCSP-TSP budget provision including any unspent balances of previous months.

​c. Transport Subsidy to BMTC/KSRTC – subject to the applicable budget provision for working out one-twelfth allocation being limited only to cash subsidy provision available after earmarking the Motor Vehicle Tax dues as provided by Transport Department and as concurred to by Finance Department separately on file.

d.​ Food Subsidy: This would be applicable to HoAs pertaining to Annabhagya for APL beneficiaries towards subsidies for food grains, Annabhagya scheme for BPL beneficiaries towards subsidies for food grains, Annabhagya scheme for BPL beneficiaries towards subsidies for other items and sugar subsidies.

11. Subsidy for IP Sets, Bhagyajyothi and Kutirjyothi (Non-Plan) Monthly ceiling for release of Subsidy for IP Sets, Bhagyajyothi and Kutirjyothi (Non Plan) will be as informed to the Energy Department by FD in file.

​​Quarterly releases during first three quarters:

​12. For all other schemes with budget provision of Rs. 10 Crore and above and not covered under Part II, 75% of the budget provision can be released in three instalments of 25% of each in the first, second and third quarter of the financial year.  These releases can be made presuming concurrence of Finance Department, provided at least 75% of the funds released earlier, including any opening balance with the implementation agency or in the personal deposit account, have been utilised.

13. For releasing of the remaining budget provision including the unspent balances of the first three quarters, proposals should be sent to Finance Department during the fourth quarter of the financial year after ensuring utilisation of 75% of the previous releases made, including opening balance. The proposal should contain details regarding funds released and utilised.  Such proposals may be made for a group of schemes.  The proposal should contain details regarding funds released and utilised.  Such proposals may be made for a group of schemes.

​​Debt Servicing


14. Release of funds for debt servicing as per terms and conditions of the debt may be made presuming concurrence of Finance Department for the full financial year subject to availability of the budget provision.
Release of Funds to PRIs:

​​​​State Schemes


15. The current practice of release of funds for the state schemes to Panchayati Raj Institutions (PRIs) by Finance Department will continue.
Centrally Sponsored Schemes and Central Plan Schemes

16. In case of plan schemes supported by centre /other centrally sponsored / central plan schemes, the procedure as prescribed at Para 23 onwards may be followed. The list of such schemes to be released by concerned Administrative Departments are listed in Annexure 3.

17. In the ZP link document, provisions under some schemes have been made under lumpsum (OH‐300). However lumpsum provisions under the schemes listed in Annexure 1C shall be released only with the prior concurrence of Finance Department. Other lumpsum schemes may be released by the concerned Administrative Departments. This lumpsum provision may be either under non plan/state plan schemes/centrally sponsored schemes. As far as non plan and pure state plan schemes are concerned, the release shall be governed by the procedure described in para 12‐13. As far as Central Assistance to State Plan (CASP) & Centrally Sponsored/Central Plan Schemes are concerned, the procedure will be as described in para 23‐27.
Releases of Funds pertaining to SCSP & TSP

18. For district sector schemes, concerned Administrative Departments should ensure that SCSP and TSP are released in pro‐rata manner for the concerned schemes with each corresponding release.

​Release of Funds to ULBs

​19. Non plan grants to Urban Local Bodies (ULBs) except for the schemes mentioned in Annexure 1A can be released up to 75% of the budget provision in three instalments of 25% each in the first, second & third quarters of the financial year presuming concurrence of Finance Department. As far as debt servicing is concerned Para 14 will apply.

20. For release of the plan grants under State Plan schemes, the delegation and norms prescribed at Para 12 to 13 shall apply. In case of plan schemes supported by centre /other centrally sponsored / central plan schemes, the procedure as prescribed at Para 23 onwards may be followed.
Releases of Funds pertaining to SCSP & TSP

21. For release of Funds pertaining to SCSP & TSP, Urban Development Department shall ensure that the allocations as intimated in the link document are included in the release orders while making corresponding releases of funds to ULBs.
Reimbursable Schemes ‐ Externally Aided Projects/ RIDF schemes / AIBP

22. Three quarterly instalments of 25% each of the budget provision can be released presuming concurrence of Finance Department, provided at least 75% of the previous releases, including opening balance, have been utilized and time lag between expenditure and filing of reimbursement claims with Government of India is not more than one month. The delegation of release of funds for the fourth quarter would be available with the Administrative Department only when there is confirmation that reimbursement pertaining to claims made during first two quarters has been received. The Government Order issued for release of such instalments should include details of compliance to the above conditions. The release of fourth quarterly instalment or any release in relaxation of above mentioned conditions will require specific prior concurrence of Finance Department.
State Plan Schemes assisted by Centre and other centrally sponsored schemes:

23. Concurrence of FD should necessarily be obtained for release of funds for the schemes listed in Annexure 1B.

24. In case of such schemes, as such, funds for central and state share of such schemes as per the approved sharing pattern can be released on receipt of the central share as conveyed through credit confirmation slip from Finance Department, subject to availability of budget provision. The Government Order indicating the release should include details of sharing pattern of the scheme, earlier central and state share releases, the central receipts credited to State Government and the corresponding state share that is being proposed for release.

25. For release of funds for central and state shares after release of the central share by Government of India but before credit in the State Government account, proposal should be sent to Under Secretary (FR&CC) in Finance Department. The release order from Government of India and details of available balance budget provision should accompany the proposal.

26. If the available balance budget provision is not sufficient to release central and state shares, the proposal should seek either re‐appropriation of funds as per G.O read at 1 above or supplementary estimate provision.

27. The details of centrally sponsored and central plan schemes would be available in plan document. The list of Central Assistance to State Plan Schemes (CASP) is at Annexure 4.

​​Central Finance Commission Grants:


28. The release of General Basic Grants and General Performance Grants to PRIs and ULBs do not require approval of any action plan, and should be released within 5 days of the receipt of the grant.

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Part V – Vote‐on‐Account limit:


29. The delegation of financial power in this order is subject to the Vote on Account limits prescribed in O.M read at 3 above. The total releases by any administrative department before the full budget for the financial year is passed should be limited to the amount approved for the “Demand” of the department in the Vote on Account.

30. For operational simplicity, the release permitted under any one scheme (vote‐on‐account limit) shall be 1/3rd of the total budget provision in that scheme. If in case, release required for a particular scheme is more than this amount before full budget is passed, the administrative department should send a proposal to Finance Department after identifying an equivalent reduction in vote‐on‐account limit in one or more other schemes of the same nature (revenue or capital). This will ensure that overall vote‐on‐account limit for a demand will not be breached.
Part VI‐ Other Instructions

​​Releases of Funds pertaining to SCSP, TSP and SDP:


31. It should be ensured that funds under SCSP, TSP and SDP are released in pro‐rata manner for the concerned schemes with each corresponding release. For pure SCSP/TSP schemes, release needs to be done following paras 12‐13 of this G.O.

32. For the schemes in Annexure 1A, where prior concurrence of FD is required for release of funds, SCSP, TSP and SDP releases can be made by the concerned administrative departments following the paras 12‐13 of this G.O.
Submission of Reimbursement Claims and Utilization Certificates

33. For the schemes requiring submission of reimbursement claims or utilization certificates to the Government of India, External Funding Agencies like World Bank, ADB, JICA, etc or to domestic financial institutions like NABARD, for schemes as that mentioned at para 22, Principal Secretaries and Secretaries should monitor that the time gap between actual expenditure and submission of the reimbursement claims or utilization certificates is not more than a month and the claims and release of next installment are followed up actively with the Government of India / concerned funding agency.
Personal Deposit Account / Bank Account:

34. Deposit of funds into bank account should not be done without specific concurrence of Finance Department that may be given for a particular transfer or a scheme in general.

35. Any deposit in Personal Deposit Account or in Bank Account of the implementation agency/officer, even if permitted by Finance Department under a particular scheme, should not be construed as an exception to exercise delegation of financial powers as per this Government Order. Also, expenditure actually incurred from out of such account as well as balance amount available in these should form the basis for further releases while exercising the delegated powers.

36. It is hereby reiterated that, while releasing funds under any scheme – either central or State, being implemented by agencies through PD / Bank accounts, it should be ensured that at least 75% of the funds released earlier, including any opening balance in the bank account with the implementation agency or in the personal deposit account, have been utilized. Release G.O. should confirm the same by invariably depicting the following:

Opening Balance
Releases made till the instant G.O.
Total fund available
Expenditure incurred
Expenditure as a %age of funds available

​Intimation to Finance Department:​

37. Upon issue, copies of release orders issued by administrative departments using delegation of financial powers as per this government order should be invariably sent to the concerned Expenditure Section of Finance Department.

​​​Role of Department of Treasury


38. Department of Treasury shall not accept bills and process releases presented by the administrative departments unless it has been ascertained that the accompanying government order has been issued in line with the details prescribed above.
By Order and in the Name of the
Governor of Karnataka,
(Arvind Shrivastava)
Secretary to Government (B & R)
Finance Department
To,
The Compiler, Karnataka Gazette for publication in the next issue of Gazette.
Copy to:

1. The Principal Accountant General (A&E)/Principal Accountant General (C&CA) and Accountant General (Audit‐II), Bangalore.
2. The Chief Secretary to Government, Vidhana Soudha, Bangalore.
3. The Additional Chief Secretary to Government, Vidhana Soudha, Bangalore.
4. The Additional Chief Secretary & Development Commissioner, Vidhana Soudha, Bangalore.
5. The Principal Secretaries/Secretaries to Government
6. The Heads of Departments.
7. The Deputy Commissioners of Districts
8. The Chief Executive Officers of Zilla Panchayats.
9. The Director of Treasuries, Bangalore.
10. The Deputy Director, Treasury Network Management Centre, Khanija Bhavan, Race Course road, Bangalore.
11. The District Treasury Officers.
12. All Additional/Joint Secretaries to Government.
13. All Internal Financial Advisors.
14. All Deputy Secretaries/Under Secretaries to Government.
15. All Sections in Finance Department.
16. Weekly Gazette/Monthly Volume/Annual Compendium/S.G.F./Spare copies.

 
(FY 2016‐17)
Annexure – 2

List of items of expenditure for which funds can be released up to budget provision presuming concurrence of Finance Department.
1. Salary and Allowances
2. Travelling Allowance
3. Diet Charges
4. Building Expenses
5. Pension and Retirement Benefits
6. Scholarship & Stipends
7. Transport Expenses
8. Old Age Pensions and Sandhya Suraksha pension
9. Pension for Destitute Widows
10. Swatantra Sainik Samman Pension Scheme
11. Pension for Physically Challenged Persons
12. Purchase of medicines for hospitals, and veterinary institutions
13. Honorarium to guest lecturers in Higher Education Department
14. Remuneration to daily wagers as provided under object head 015 –subsidiary expenses
15. Payment to contractual or outsourced staff as provided under object head‐059‐other expenses

ANNEXURE-1, ANNEXURE ‐ 3, ANNEXURE-4 DOES NOT APPLY FOR ANY SCHEMES UNDER DEMAND NO. 18 IN RESPECT OF COMMERCE AND INDUSTRIES
 

 

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