Assembly passes amendments to Infrastructure Investment Fund Act

Finance Minister Thomas Isaac piloting Investment Fund Bill on Nov. 2Thiruvananthapuram: The Assembly unanimously passed the Kerala Infrastructure Investment Fund (Amendment) Bill on Wednesday.

The Bill seeks to enable the Fund Board to employ new fund mobilisation methods to finance infrastructure development measures announced in the revised Budget for the current year.  Funds are proposed to be mobilised through general obligation bonds and revenue bonds to meet medium term requirements and other financial structures such as alternative investments funds and debt funds to meet long term requirements. The Budget had proposed an anti-recession package of Rs. 20000 crore.

Replying to the debate on the Bill, Finance Minister T. M. Thomas Isaac said that the legislation had specific provisions for oversight by Assembly on mobilisation and use of the funds. Mobilisation of funds outside the Budget was being proposed as the Budget did not have the wherewithal to fund proposed infrastructure development projects.

Denying Opposition criticism that government departments would lose control of projects, the Minister said that that the departments would be able to oversee projects. The administrative sanction is to be given by departments concerned. They are also to examine and provide project completion certificates for release of money by the Kerala Infrastructure Investment Fund Board. While departmental projects outside the budget go for financial sanction from the Finance Department, financial aspects of projects funded by KIIB are cleared by its Director Board.

He said that the interest on the debt to be availed by the Board would be lower than that being paid by government for open borrowings. The provision for toll in the Bill was only an enabling provision. Toll would not be collected for ongoing projects as announced in the Budget.

Mr. Thiruvanchoor Radhakrishnan (Congress) said that the executive committee of the Board would become a super Cabinet that handles more money than that in the State Budget. It would not have accountability towards the House.

Mr. V. D. Satheesan (Congress) demanded that there should be a set up to scrutinise the expenditure by the Board.

Expressing similar sentiments, Opposition Leader Ramesh Chennithala said that the Board would be a super department. Many of the projects proposed were unproductive and their liabilities would ultimately fall on the tax payer.

The Subject Committee had reported the Bill with dissent notes from Mr. Radhakrishnan, Satheesan and N. Jayaraj. Mr. Jayaraj disagreed with proposals to collect toll and user fees in the Amendment.