Govt to pay contractors in infra projects via online system

According to state finance dept, process will minimise time used for payment to contractors

The state finance department has decided to allow online transaction of payments and disbursements related to infrastructure spending of works, irrigation and forest departments in select districts on a pilot basis. This facility will be rolled out in the entire state later.

According to a memorandum issued by the finance department, the process will minimise the time consumed for payment to contractors.

“After successful roll out of electronic disbursement of all state government payments drawn through bills in Treasuries, it is now decided to replace the system of drawal and disbursement of funds relating to works expenditure through paper cheques by account payee electronic cheques for direct credit of the proceeds to the payee’s bank account,” said the memorandum issued earlier this week.

As per the proposal, contractors, vendors, suppliers and other stake holders of a project will receive their payments via online system. It has been decided to operationalise this system first for projects of the irrigation and works departments in Bhubaneswar division.

Besides, the forest department has been directed to receive statutory dues such as funds deposited against forest land diversion (NPV) and funds for development of forest area (CAMPA) through online payment mechanism. However, it is not mandatory for payers to make payments of such dues through internet banking.

For the electronic payment and disbursement system, the state government will use the facility provided by Central Electronic Payment Processing Centre using the payment platform of Reserve Bank of India (RBI) via National Electronic Funds Transfer (NEFT) mechanism.