Cash crunch, technical 'glitch' affect bill payments in Andhra Pradesh

A cash crunch on one hand and a software glitch on the other has resulted in freezing of bill payments running into thousands of crores of rupees in Andhra Pradesh, for over a month now, official sources said.

In fact, the salary and pension was paid only on April 7, a week behind schedule, because of the "software problem".

There are a total of 7.9 lakh employees and pensioners on government rolls in the state.

The non-release of funds by the Centre is being cited as one reason for the cash crunch.

"We have to get about Rs 3,000 crore for the multipurpose Polavaram project and another Rs 350 crore under the backward districts development grant. This has been causing a strain on our payments position," a senior official of the Finance Department pointed out.

In all, payments worth Rs 8,000 crore have been stalled "for various reasons," the official said.

This apart, another Rs 1,500 crore worth bills have been pending with the Treasury due to non-clearance by the state government.

Of Rs 8,000 crore, half relate to payments for capital works and the balance to various government schemes.

The state government recently introduced the Comprehensive Financial Management System, which is an integrated payment network.

However, inadequate training of staff and also the glitches in transition from the old software to the new CFMS software have resulted in freezing of payments.

In Krishna district, for example, payments worth Rs 800 crore have been stalled and the Pay and Accounts Office (PAO) has been asked not to make any releases.

"Just for a day on March 27, we were asked to release 20 per cent of the dues and immediately thereafter further payments were kept on hold," a PAO official said.

In January, cultural shows were organised in all the 175 Assembly constituencies in the state as part of the state government's 10-day mass outreach programme 'Janmabhoomi,' but the artists have not been paid their remuneration yet.

"We could not pay even Rs 1,000 to an artist, which is really painful. We have adequate budget, but the government stalled all payments," rued an official of the Department of Culture.

The Department of Culture, in all, owes over Rs 3 crore to artists for various programmes.

"Without salary, majority of the Kuchipudi teachers are reluctant to work and we can't force them. This may adversely affect the government's ambitious programme to promote Kuchipudi, the native dance form of the state," the Culture Department official said.

Meanwhile, State Finance Secretary Muddada Ravichandra told PTI that the 'software problem' caused by the transition to CFMS has indeed affected the payments.

"All data has to be totally re-entered into CFMS from the old system. Staff are also not totally familiarised with the new system despite one round of training."

"We are now giving them hands-on training for two days on April 17 and 18 so that we can overcome the problems," the secretary said.

There was no financial crisis as such but non-release of funds by the Centre has resulted in some problem, he added.