The Govt. of Bihar has conceived MKUY to improve the socio-economic status of girls and women in the state. However, the current fund transfer process operates on a pull-based mechanism where beneficiaries need to explicitly register for the scheme through an intense data collection mechanism. This adds unnecessary friction to the program, thereby affecting the scheme’s uptake.
MSC proposed a full Direct Benefit Transfer mode push-based mechanism that automatically identifies and on-board beneficiaries needs to be envisaged and implemented. MSC has provided advisory services and proposed a holistic digital solution for scheme management and timely approval of payments. Some solutions include using core public financial management reform principles such as Single Source of Truth to integrate current beneficiary databases for better scheme delivery; to establishing a dedicated cell to oversee the implementation of the envisaged technology architecture of MKUY.
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The Govt. of Odisha has launched the MUKTA scheme for providing employment and weekly wages to the unemployed labor force of the state through SHGS in small-scale community infrastructure projects. However, the scheme faces challenges in implementation mainly resulting from delays in settlement of claims and ineffective project management.
MSC has proposed using digital payment systems as a tool to increase efficiency, enhance transparency and reduce delays in contract management and fund disbursement processes. Based on the field study and diagnostic assessment of the scheme MSC has proposed a holistic digital solution for scheme management and timely approval of payments to wage seekers with features such as transparent and authenticated digitized input of work progress, workflow automation, smart payment engine, and real-time monitoring of data to track expenditure and progress of the scheme.
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The Government of India launched Ayushman Bharat Pradhan Mantri Jan Aarogya Yojana (PMJAY) in September 2018 to address the persistent challenges of affordability and accessibility in the healthcare system in India. Though the scheme has achieved significant milestones in the first year, various learnings and best practices could be used for further course corrections to improve the processes, efficiency, and overall scheme performance. States also have their own implementation experiences, which can be leveraged at the National level.
MSC has proposed digital payment systems as a tool to increase efficiency, enhance transparency and reduce delays in claim adjudication processes.
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The Odisha government has one of the most advanced treasury management systems in India. However, challenges of manual processing of bills, idle parking of funds, and float in the system persist that lead to sub-optimal fund utilization.
MSC is implementing a Just-in-Time funding solution for the finance department of the Government of Odisha. The solution will ensure that the money owed by the state’s implementing agencies (IA) to the end beneficiary or the payee in a public project is paid directly from the state’s treasury in real or near real-time. These could be urban local bodies, autonomous bodies, or NGOs that undertake public or welfare work on behalf of the government. The solution will mark two key departures from the existing fund flow mechanism. Firstly, the ability to draw the funds directly from the state’s treasury will eliminate the need for the IAs to park funds in the commercial bank accounts outside consolidated funds. Secondly, the pull-based funding mechanism allows the IAs to make payments to their payees in real-time.
The benefit of JIT funding is that it will allow the finance department to reduce ‘idle cash’ outside the treasury and optimize borrowing costs. Also, with real-time visibility on cash balances, the administrative burden associated with expenditure reporting and utilization is likely to get reduced.
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Our experience suggests recent digital developments in India around Jan Dhan, Aadhaar, Mobile (JAM), India Stack, direct benefit transfer, payment interoperability, among others, have been relevant to many African and Asian countries. There has been tremendous interest from other countries to learn from India’s achievements, and several countries have replicated some of the lessons from India.
With this backdrop, MSC is keen to explore the challenges in PFM for the African countries and explore if there is a potential to replicate some of the lessons from our projects with Indian governments to other countries. This will help assess the fitment and relevance of the tools and knowledge products produced by our projects for Africa and also enable us to adjust our approach, if feasible, to ensure that the products generated are relevant across several countries beyond India. Through this study, MSC will get some inputs to shape its PFM and state capacity work-related strategy for Africa.
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The Social Security and Empowerment of Persons with Disabilities (SSEPD) Department of Government of Odisha has recommended 50 special schools (which educate differently-abled children) to provide grant-in-aid from the GOI. The grant includes maintenance of residential and non-residential students and remuneration of teaching and non-teaching staff as determined by the GOI.
However, the scheme has faced challenges in terms of payment delays (salaries to the teachers) due to ineffective fund management and ineffective monitoring of the scheme.
MSC conducted a diagnostic assessment of the fund flow system, functioning of the scheme, review of IT systems, etc. Based on these diagnostics, MSC has recommended and is now supporting the government in the implementation of ‘smart payment solutions’ with ‘just in time’ funds, to be integrated with the government’s existing public finance management platforms.
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