Central govt asks for transparency in disbursal from Environmental Relief Fund

New Delhi: The environment ministry has asked for more transparency in the way money from the Environment Relief Fund is disbursed to victims of major environmental disasters.

Draft regulations issued by the ministry on Thursday asks fund managers of the Fund to disburse all pay-ins to Central and state Pollution Control Boards (PCBs). The ministry is inviting comments from stakeholders for 60 days from 25 July.

The ministry proposed these amendments to the Environment Relief Fund Scheme, 2008.

Under the proposed amendments, the fund manager must disburse any money it collects to PCBs once it is ordered to do so by the Central government, and follow up with PCBs about the utilization of the funds.

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The Environment Relief Fund, set up after the 1984 Bhopal gas leak tragedy, is supposed to disburse money to help victims of major industrial accidents. The fund, however, has not disbursed any money since 2019, as per a 2023 Rajya Sabha disclosure.

The total amount in the fund as of FY23 was ₹1,060.95 crore, according to the annual report of United India Insurance Company Ltd, the fund manager.

Draft regulations

As per the draft regulations, the fund will also collect penalties under the Public Liability Insurance Act, as also the interest or returns earned on the investments of the Environmental Relief Fund. These funds will be monitored separately by the fund manager, the proposal said.

The central government has proposed to tweak the procedure to be followed under the Public Liability Insurance Act, which was created to compensate victims of major industrial hazards. 

Now, under the proposed changes, the central government will assess the damage after receiving a complaint under the Act, and order the fund manager to disburse funds to central or state PCBs for compensation.

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The Central or state PCB or fund manager will maintain proper records and documentation of the utilization of funds, the government proposed.

 The fund or the PCBs will also submit annual reports to the Central government detailing the progress of environmental remediation, the proposal said.

The Centre will also monitor the utilization of funds disbursed to the pollution control boards, the proposal said.