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₹12k crore in state’s disaster kitty: Punjab govt’s claim deflated by CAG report
The report concluded that the state government had not invested funds of ₹ 9,041.74 crore available under the SDRF, which means that the funds were used for other than intended purpose.
Days after Prime Minister Narendra Modi flagged ₹12,000 crore as already available in the state’s kitty for disaster relief, chief minister Bhagwant Mann on Friday dismissed the claim, stating that his government had received only ₹1,582 crore during its tenure, of which ₹649 crore had been spent.
Mann, addressing his first press conference after being discharged from the hospital, said they (the central government) claim that this is the amount received by the state over the years, but where is it? Chief secretary KAP Sinha, who was present, also said that the figure of ₹12,000 crore existed only as entries in accounts.
A perusal of official records shows that, as per finance accounts, an amount of ₹8,194.07 crore was lying in the SDRF on April 1, 2022, with the state regularly receiving funds from the central government for disaster relief.
By March 31, 2023, this amount increased to ₹9,041.74 crore after a transfer of ₹908.85 crore, which included ₹208 crore as the central share and ₹69.33 crore as the state share and ₹637.57 crore paid by state government as interest for 2022-23, according to the Comptroller and Auditor General’s report on state finances for the fiscal year.
This balance was left after an expenditure of ₹61.18 crore from the fund on relief measures during the year.
Central govt’s norms violated
The CAG, in its report released in September 2024, pointed out that the entire balance of ₹9,041.74 crore was lying in the SDRF uninvested, pulling up the state authorities for violating the central government’s guidelines on investment of funds.
The audit report covered the first year (2022-23) of the AAP’s rule. A government official familiar with the matter, speaking on condition of anonymity, said that the central and state governments contributed to the SDRF in a 75:25 ratio, and the accruals, along with interest, amounting to about ₹12,000 crore as per the finance accounts, were held in the state’s reserve fund and adjusted against borrowings.
According to the guidelines issued by the Union home ministry’s disaster management division, the state governments are required to pay interest to the SDRF at the rate applicable to overdrafts under the Overdraft Regulation Guidelines of the RBI, to be credited on a half-yearly basis. “The accretions to the SDRF, along with the income earned on its investments, are to be invested in central government dated securities, auctioned treasury bills, and other interest-earning deposits with scheduled commercial banks,” said the federal auditor’s report.
The report concluded that the state government had not invested funds of ₹ 9,041.74 crore available under the SDRF, which means that the funds were used for other than intended purpose.
It added that the state government had conveyed in November 2023 that the matter regarding the investment of SDRF funds was under consideration.
The Centre had set up the SDRF to replace the erstwhile Calamity Relief Fund in 2010-11, with contributions from the central and state governments to be transferred under public account to major head-general and other reserve funds. The Finance Commission determines the allocation of the SDRF for all states for each of the financial years for the entire award period. In the event of natural calamities, the state governments provide financial relief to the affected people from the SDRF in accordance with approved norms of the central government. However, in the event of a disaster of severe nature, additional financial assistance is extended from the National Disaster Response Fund (NDRF), maintained by the Government of India, following an assessment based on the visit of an inter-ministerial central team. Chief minister Bhagwant Mann wrote to the Prime Minister on August 31, seeking a revision of norms for providing compensation to flood-affected people in the state from the SDRF and NDRF.
