User:Dsharma2/Central Plan Scheme Monitoring System (CPSMS)

Central Plan Scheme Monitoring System (CPSMS) is a public financial management reforms initiative of the Government of India towards establishment of a comprehensive and real time Decision Support System and Management Information System for monitoring of Centrally Sponsored Schemes, Central Sector Schemes, Additional Central Assistance to states and support to State Plan provided by the Government of India.

CPSMS attempts a paradigm shift in the monitoring in the social sector and aims to enhance development effectiveness by providing real time information on implementation of schemes and tracking the funds disbursed. It integrates the generation of information into the scheme implementation process itself as against data entry that has traditionally been required post facto in MIS systems for social sector schemes.

Why CPSMS
There are over 1045 Centrally Sponsored and Central Sector Schemes being implemented in the priority social sector, aimed at millions of beneficiaries across India, through the different ministries of the Government of India. Moreover, the Central Government also releases funds under Additional Central Assistance to states, and support to State Plan. Approximately Rs. 300,000 crores (USD 680 million) is released under these channels each year. Given the diversity in the implementation hierarchy, the number of implementing units and the geographical reach of these schemes, it has been a challenge to have meaningful information on these schemes. Thus, the need for a central monitoring, evaluation and accounting system for the Plan Schemes has been widely acknowledged. This not only effects the monitoring of the Plan Schemes but also has implications for financial management in the public sector.

CPSMS attempts to bring greater transparency and accountability to social sector monitoring the way it has never been experienced in the country. Entire fund flow and utilization can be put in the public domain, and fund transfers to grassroots entities and utilization by them can be accessed by interested individuals and organizations. This would bring give social audits the edge of information that they have lacked in most parts.

Some more realities accentuate the need for such a system. Only about 20% of these funds are routed to states through the Treasury route and 80% of through Special Purpose Vehicles, which are alleged to be inherently weaker in internal control mechanisms available in the Treasury mechanism.

The current program specific MISs operate with time lags and do not give a clear picture of funds remaining unutilized and lying idle in the banking channel. While releases are booked as expenditure in the Central Government accounts, the utilization in the field takes time and while commercial banks enjoy the float, Central Government borrows from market to meet its fiscal deficit. In large parts, this is attributable to absence of a system that could provide consolidated or granular information on utilization, advances, fund transfers or bank balances across schemes, districts, blocks or institutions. Further by the time utilization reports climb up several tiers, reaching State and Central level, the data is already historical, significantly limiting its utility. CPSMS aims to aid in better fiscal deficit management, and to ultimately move to a system of flow of authorization as against the actual flow of funds, whereby banks will first meet the expenses of the implementing agencies and then seek reimbursement from the Central Government.

Further, MISs based on post facto data feeding suffer from drawbacks of inefficiencies, inconsistencies, gaps and perennial reconciliations, as they are not integrated with the process flow. CPSMS attempts to address this, and the associated issues of transparency and accountability related to the SPV mode of implementation, keeping all the advantages of the mode intact.

History
The Economic Survey (2007-08) emphasized the need of output and outcome monitoring and creating knowledge-based expertise for effective financial monitoring of the Plan Schemes. Subsequently the Finance Minister in his Budget Speech (2008-09) announced the setting of the Central Plan Schemes Monitoring System towards establishment of a comprehensive Decision Support System and Management Information System. The intended outcome is to generate and monitor scheme-wise and State-wise releases for the Central Plan and Centrally Sponsored Schemes.

The 11th Plan Document also recognized the deficiencies in the existing accounting system for the Plan Schemes and its inability to support informed planning, budgeting and effective monitoring of these schemes. It also underlined the need for a consolidated financial information system for the Plan Schemes.

The EFC of the Planning Commission has approved the implementation of CPSMS in a phased manner. The Finance Minister has also accorded its approval in principle for the entire scheme. Administrative and financial approval for Part A of the Scheme with an outlay of Rs. 24.25 crores has also been received.

Modus Operandi
The system uses a web-enabled application developed in the office of Controller General of Accounts, the apex accounting authority of the Government of India under Ministry of Finance (India). In first step, every agency at involved at any tier in the implementation of a scheme (and receiving funds) is registered on the system. Registration involves registration of all the bank accounts of the agency and this information is shared with the respective banks’ Core Banking System (CBS) for authentication.

Post registration, CPSMS will enable one to one validation or payment authorization of each release of funds, whether in forms of expenditure, advance, or transfer. This would mean that the corresponding instrument number and amount for any release would need to be entered in the system at the time of generation of official sanction, i.e. before the actual transaction. Through the CPSMS-CBS interface, this information would be shared with Banks’ CBS and an instrument of payment will be honored by banks only when the corresponding entry is received through the CPSMS.

Current Implementation Status
The system is completely functional in all the central ministries and all the state-wise, ministry-wise and scheme-wise reports are available to users in these ministries. Further, the system is currently being rolled out in the four states of Madhya Pradesh, Bihar, Mizoram and Punjab. The CPSMS-CBS interface is now functional and is providing real time information exchange with the banks.

Significant achievements
CPSMS has made significant strides since its initial roll out. The dedicated web portal of CPSMS is operational and has registered 4.62 lakhs hits. All the Plan Schemes of Civil Ministries have been mapped and about 75,000 Sanctions were issued in 2009-10. All releases from Government of India under Plan Schemes are now made through CPSMS, and all agencies receiving these releases are registered on CPSMS Portal. Till now 18,264 agencies have been registered. Hitherto unavailable, Ministry-wise, Scheme-wise, State-wise, District-wise, NGO-wise, Individual-wise data of releases from GOI is now available centrally on CPSMS in real time. Further, the CPSMS data fully reconciled with the accounting data of CGA.

CPSMS has also won the Microsoft Developer Innovation & Excellence Award 2009