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Odisha to get expenditure-based NREGA fund release facility

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OST Bureau
Bhubaneswar, Dec 2:

To ensure that the funds flows are streamlined in such a way that every state is assured of adequate funds for implementation of Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) at all times, the Ministry of Rural Development (MoRD) has instituted an Expenditure-based Fund Release System (EFRS) under electronic Fund Management System (eFMS) for release of funds from the Centre to the states.

Jairam Ramesh, Union minister for Rural Development
Jairam Ramesh, Union minister for Rural Development

In a letter to chief minister Naveen Patnaik on Saturday, Union Rural Development Minister Jairam Ramesh said the benefits of EFRS that ensures availability of funds at State Employment Guarantee Fund (SEGF) as per an agreed formulation, would be initially operationalised in six states including Odisha from December 2.

Under the EFRS, the sanction order will be given on April 1 and November 1 each year. The Centre would ensure that that a Minimum Funds Assured (MFA), which is a 14-day average expenditure based on historical (including seasonal) considerations, would be maintained by the state at all times.

“As and when the MFA is breached, further release would be made electronically and within 24 hours to replenish the SEGF so that the MFA is reached”, the Union minister said, adding that that his ministry would use EFRS for funds release for other rural development programmes.

“I hope you would appreciate the new system that would drastically reduce endless paper work and protracted correspondence between the Ministry and the state”, Ramesh said in his letter.

It may be mentioned that the MoRD has already institutionalised eFMS to ensure smooth and prompt funds flow to the field level to meet the requirements of the rural poor under the MGNREGA scheme.

The system has made the entire monetary system transparent and hassle-free besides being free from administrative delays.

This apart, the eFMS has also ensured that allocation of resources from gram panchayats is done based on performance, thereby eliminating parking of funds.