Revised Scheme for Constitution and Administration of National Calamity Contingency Fund (NCCF)

Title of the Scheme

1.  The Scheme shall be called 'National Calamity Contingency Fund (NCCF) Scheme'.

Period of operation

2. It shall come into force with effect from the financial year 2000-01 and will be operative till the end of the financial year 2004-05.

Calamities covered under the Scheme

3.Natural calamities of cyclone, drought, earthquake, fire, flood and hailstorm, considered to be of severe nature requiring expenditure by the State Government in excess of the balances available in its own Calamity Relief Fund by the National Centre for Calamity Management (NCCM) will qualify for relief assistance under the Scheme.

Constitution of National Calamity Contingency Fund

4. A 'National Calamity Contingency Fund (hereinafter referred to as 'the National Fund') will be constituted by the Govt. of India for the purpose of dealing with the above mentioned calamities of severe nature.  The National Fund would be classified in the Public Account of the Govt. of India under the major head 8235- 'General and other Reserve Funds' in the sub-section 'Reserve Funds not bearing interest'. 

Contribution to the National Fund

5.1 The initial corpus of the National Fund shall be Rs.500 crore to be provided by the Government of India. 

5.2  Transfers to National Fund will be made  under the minor head- 797- Transfer  to the ‘Reserve Funds and Deposit Account’ –Transfer to National Calamity Contingency Fund under the major head '2245- Relief on account of natural calamities-80-General.

5.3   An amount of Rs.500 crore being initial corpus shall be transferred to the National Fund under a new minor head ‘National Calamity Contingency Fund’ under major head 8235-General and other Reserve Funds by per contra debit to major head '2245'.

5.4  The debits to the major head '2245' for transfer of initial corpus  as well as subsequent accretions by levy of surcharge shall be covered by budget provision to be made in the Grant “Transfers to State and UT Governments”(under Non-Plan).

National Centre for Calamity Management

6.1   A National Centre for Calamity Management (NCCM) (hereinafter referred to as 'the National Centre') shall be constituted by the Ministry of Home Affairs. The Centre will monitor the occurrences of natural calamities relating to cyclone, drought, earthquake, fire, flood and hailstorm on a regular basis and assess their impact on area and population.

The Centre will also assess whether the State will be in a position to provide relief in a specific case of calamity of severe nature from the CRF and its own resources.  It shall then make a recommendation to the Central Government (Ministry of Home Affairs in respect of natural calamities of cyclone, earthquake, fire, flood, hailstorm and Ministry of Agriculture in respect of drought.) on its own on the following :

  (i) whether the calamity is of a severe nature and, therefore, eligible for assistance from the Central Government and other State Governments;

 (ii) How much of the expenditure on immediate relief and rehabilitation should be met from the National Fund and how much from the State’s Calamity Relief Fund.

6.2    The Ministry of  Home Affairs  shall oversee that the money drawn from the National Fund is applied by the State Governments for the purpose for which the National Fund has been set up..

6.3  All administrative and miscellaneous expenses of the National Centre shall be borne by the Ministry of Home Affairs under its normal budgetary provisions. 

Release of assistance from the National Fund

 7.1 The recommendations of the NCCM for release of assistance to States shall be considered by High Level Committee on Calamity Relief to be constituted by the Ministry of Home Affairs.  The said Committee shall decide the manner and extent of assistance required to be provided to the States. Pending the constitution of the High Level Committee and NCCM, an interim committee consisting of Deputy Prime Minister/Home Minister, Agriculture Minister, Finance Minister and Deputy Chairman, Planning Commission shall assume the role of the High Level Committee in deciding  the manner and extent of assistance required to be provided to the States. The High Level Committee will be serviced by the Disaster Management Division of Ministry of Home Affairs.   The assistance from NCCF will be only for immediate relief and rehabilitation.  Any reconstruction of assets or restoration of damage should be financed through re-allocation of Plan funds.

 7.2    The releases to the State Governments shall be made as per the decision of the High Level Committee on Calamity Relief .

7.3    Suitable budget provision for release  of assistance to States from National Calamity Contingency Fund shall be made under the  head ‘2245 – Relief on account of Natural Calamities-80- General –Assistance to States from  National Calamity Contingency Fund  ( a new minor head to be opened  for this purpose)’ with an equivalent amount  shown as recovered  from the Fund ,  maintained in the Public Account, below the head ‘2245-Relief on account of Natural Calamities-80-General-Transfer from Reserve Funds and Deposit Accounts- National Calamity Contingency Fund’ thereunder.

7.4  On receipt of assistance  from the National Fund, the State Government shall treat them as receipts along with the receipts of Central/State shares of Calamity Relief Fund under the major head "1601"  - Grants-in- aid from Central Govt. -01 Non-Plan Grants- Grants from National Calamity Contingency Fund (new minor head).  In order to enable transfer of the amount received as assistance from NCCF, the State Government would make suitable budget provision on the expenditure side of their budget under the relevant minor heads under the major head “2245- Relief on Account of Natural Calamities".  The State’s CRF account should distinctly show the receipt of assistance  from NCCF apart from the remaining four sources of receipts into the fund; namely (i) Centre’s share of Calamity Relief Fund (ii) State’s share of Calamity Relief Fund (iii) Return on investments and (iv) redemption of investments. 

 7.5   The Pay and Accounts Office, Ministry of Finance(DEA) on the basis of the sanction orders issued by the Ministry of Finance shall release payments to the State Governments. The detailed account of the Fund shall be maintained by the Controller General of Accounts through the Chief Controller of Accounts, Ministry of Finance.

Functions of the State Level Committee.

8. The State Level Committee constituted by the State Govt. to administer the Calamity Relief Fund shall be responsible to ensure that expenditure incurred out of the funds received under the NCCF is as per the items and norms of expenditure as decided for in respect of  the Calamity Relief Fund.

Special Surcharge on the Central Taxes

9.  Any assistance provided by the Centre to the States from the National Fund shall be financed by levy of a special surcharge on the Central taxes for a limited period.  Collection from such surcharge shall be initially credited to the Consolidated Fund and thereafter transferred to the National Fund. Any drawal from the Fund for providing assistance to States shall be accompanied by imposition of the special surcharge so that it is immediately recouped. 

Monitoring

10. The Ministry of Home Affairs shall monitor the scheme of NCCF.

Unspent balances in the National Fund

11. The unspent balance in the National Fund at the end of the financial year 2004-05 will be available to the Central Government for being used as a resource for the next Plan.

Accounts & Audit

12. The accounts of the National Fund shall be maintained by the Chief Controller of Accounts, Ministry of Finance.  The Controller General of Accounts (CGA) may prescribe detailed accounting procedure for the purpose as required.  The Ministry of Finance will, however, maintain subsidiary accounts in such manner and detail as may be considered necessary by the Central Government (Controller General of Accounts) in consultation with the Comptroller and Auditor General of India .  The accounts of the National Fund shall be audited annually by Comptroller & Auditor General.

Savings

13.  The Central Government may issue instructions relating to the provisions of the scheme as may be considered necessary from time to time to enable smooth functioning of the scheme.  The Central Government may also alter/ modify the scheme if considered necessary subsequently.  In case of any difficulty in the operation of any provision of this scheme, the Central Government, if satisfied, may relax the provisions.