Question

Q. With reference to the Public Financial Management System (PFMS), consider the following statements:

Which of the above given statements is /are correct?

• A.
  1 and 2 only
• B.
  1 and 3 only
• C.
  2 only
• D.
  2 and 3 only

Answer 1

The correct option is C

2 only
Explanation:

Statement 1 is incorrect: The Public Financial Management System (PFMS), earlier known as Central Plan Schemes Monitoring System (CPSMS), is a web-based online software application developed and implemented by the Office of Controller General of Accounts (CGA), Ministry of Finance.

Statement 2 is correct: Under the DBT, subsidies are transferred to the people directly through their bank accounts. The primary objective of PFMS is to facilitate a sound Public Financial Management System for Government of India (GoI) by establishing an efficient fund flow tracking and monitoring system as well as a payment cum accounting network,under which it monitors and tracks all the funds or subsidies dispersed By the Government to the intended beneficiary. PFMS provides various stakeholders with a real time, reliable and meaningful management information system and an effective decision support system.

Statement 3 is incorrect: The Public Financial Management System covers all the subsidies disbursed by the Government under Centrally sponsored or central sector schemes including LPG SUBSIDY, that are directly transferred to the bank accounts of individual beneficiaries. The Direct Benefit Transfer ensures cash benefit is provided directly into the account of the beneficiary with the help of the Public Financial Management System (PFMS). Such a mechanism helps in removing duplicate/ fake beneficiaries, plugging of leakages, and cutting wastage, thus ensuring the effective use of resources for schemes such as the LPG subsidy or wages under the rural employment guarantee programme.